Over the past 5 years, I've worked with many partners in helping them figure out how to add the cloud to their revenue mix. In my prior role leading Microsoft's cloud partner efforts in the Microsoft Worldwide Partner Group, much of the focus was on the resale of SAAS offerings as a replacement for low margin license reselling, which was a good business for both Microsoft and the partner community.
But this is not where the major revenue and profit drivers for partners will come from. Reselling the cloud is a good business, but building cloud into your services practices takes time, both for the vendors to open their cloud up to value-added work and for the market to mature to accept these. We are now there, so it might be helpful to share some best practices on how you evolve your service offerings as a value partner to embrace the cloud more fully, as well as the economic reasons why you should lead in this area now, versus waiting for the market to evolve more.
Cloud services are evolving now at a rapid rate, creating new opportunities for partners. Office 365 has matured their SharePoint Online offerings to a new level of integration and automation, making the design, integration and management of workflows and application functionality critical. VMware's vCloud offering is another example where a recurrent subscription model (vCloud) meets a high value service model (application migration and management). These advances in the cloud offerings in the market are opening up bigger platforms for customization and integration, making the cloud a stronger offering for the partner community.
But beyond this evolution, the sheer volume of cloud offerings is creating a strong need for a clear cloud integration practice at partners - the early cloud was about migration from on-premise to cloud, the new wave is about integration, management and federation of services. Partners who accelerate their adoption and integration of cloud services as an element of their offerings and drive integration between on-premises and cloud services will find themselves in a leadership position over the next 5 years relative to competition.
How does a partner get started? First, figure out how cloud will fit within their offerings, which is part of our business model transformation workshop we offer partner companies. This workshop takes partners through a two day session where we design the new offerings, figure out their compensation and operation plans and financially model out the impact of these offerings over time. Second, once you understand your offers and practices and the change management model to get to delivery, start talking to customers about their needs and how a cloud-connected solution may accelerate value for them. Lastly, put a stake in the ground on where your value is going to reside and double down on that practice - focus on a clear value statement and repeat the execution and delivery until your practice is clearly differentiated from others.