Run your business news
Joseph F Kovar
“Due to their staffing issues, customers will be more receptive to things like Zero Trust faster than we’re seeing at the company. They will be more open to ramping up staff on the cybersecurity side and engage with XDR faster,” said Phillip Walker, CEO of Customer Advocate at Network Solutions Provider.
A solution provider’s view of the market for medium-sized companies
Midsize companies occupy a unique part of the IT market. During his keynote address at this week’s Midsize Enterprise Summit in Las Vegas, Gartner analyst Mike Cisek said midsize companies typically have an IT budget of less than $20 million and 10 to 30 full-time equivalent IT staff , which serve an average workforce of 1,766 people.
These companies face several serious IT challenges, chief among which is security, Cisek said. Yet they typically lack a dedicated network operations center or security operations center. More than half don’t have a full-time CISO and can rest assured that only 5 to 10 percent of their IT budget is devoted to security tools and services, he said. “Effects of scale don’t apply,” he said.
Midsize businesses need help addressing their problems, the kind of help IT solutions providers can find, said Phillip Walker, CEO of customer attorneys for Manhattan Beach, a California-based network solutions provider.
[Related: 7 Major Cybersecurity Risks For Midsize Organizations: Gartner]
Walker, speaking to CRN during the Midsize Enterprise Summit, said that companies that rely on channel partners for support are more likely to successfully achieve their IT priorities than when they work directly with vendors.
“When I sit down with a client, I don’t have an agenda,” he said. “Instead it’s like, ‘Where are you? What do you need? How can I deliver it?’” When you call a vendor, that vendor says, “Don’t talk to anyone else. Just give us a call.” But if you bought that product and now own that product as a business, how do you grow it into your solution now? How do you get the piece in without a channel?”
IT solution providers are evolving with the business needs of midsize companies, Walker said. For example, his company is working closer than ever to the edge of customers’ IT infrastructures because their own customers are moving there.
“And when we get to the edge, people start to realize, ‘Hey, I need your team and your expertise. And I need more of a strategic plan and roadmap of how to go from siled infrastructure to cloud infrastructure to hyper-converged to zero-trust infrastructure,” he said. “Who will control this? We can do that best.”
Walker gives CRN an up-close look at the importance of the channel to the mid-market business market.
So what do you see when you look at the business customers of medium-sized companies? What do they tell you what their top priorities are?
It’s a very unique market because no matter how big the companies are, they don’t have huge IT teams. So we’ve grown with them in a co-managed environment, be it on the MSP side or on the cybersecurity side, and we find that they are more open to next-gen technologies than the company. So they are more open to innovation and to some of the smaller and more unique partners we work with.
When you say “more open to next-gen technologies,” what type of technology are you referring to?
Because of their staffing issues, customers will be more receptive to things like Zero Trust faster than we’re seeing at the company. They will be more open to ramping up staff on the cybersecurity side and look at XDR [extended detection and response] faster than some others. For us, 60 percent of our customer base is in this market segment. We understand their needs: easy to implement, sensitive to IT budgets, the ability to augment current staff and then give them a unique technology stack that suits them because we understand where they stand. And implementation is difficult. So we have always considered ourselves independent of manufacturers and technologies. So where is the customer? What is his talent stack? Let’s expand that from a features perspective, take care of all the stuff they didn’t have time for, create a baseline, and then fill in the gaps with what they need.
As a solution provider in a medium-sized company, do you have to evangelize the latest technologies and services? Or do the customers come knowing what they want?
There are a lot of evangelism and case studies that show proofs of concept and engage in really good bake-offs. Because it’s hard to take someone where they’ve never been. Currently, the threat landscape for a customer changes every three to six months. How can you keep up with that if you don’t have the tools, since the tools you bought six months ago took four months to deploy and therefore doesn’t necessarily flow into your threat vector. So we have to find the new threat vector in six months. These are the things we are doing as a solution provider that have helped accelerate this. Because we can walk in and say, “Hey, here you are today. I see where you’re going tomorrow.” And we can provide those next steps and provide scalable solutions that can grow with them.
So you think this is something only distributors can do?
An added value that we add is that we can take care of the provider selection. So if there are 15 different solutions, which one fits this company? We can make the product recommendations for the company. So we can work as a partner with the CIO and be part of that hive mind. You can see what’s on the market, you see what’s on the market. You understand it. You know where they are.
When I sit down with a client, I don’t have an agenda. Instead: “Where are you? What do you need? How can I deliver it?’ When you call a provider, that provider says, “Don’t talk to anyone else. Just talk to us.’ But if you bought that product and now own that product as a business, how can you grow it into your solution now? How do you get the piece in without a channel?
Essentially, the channel offers the opportunity for all technology parts. Without the channel, providers could not grow and do what they had to do. Now, if you sell a solution to a mid-size company, who will support it once the sale is complete? who will fix it Who will implement it? Who will manage it? Who will scale it? Most medium-sized companies do not have large IT departments. And when they do, they’re busy doing migrations and doing 900 other things. This new thing is coming and they have to stop what they are doing to embrace it. The channel shortens this time to market. So I’m looking at value, and our greatest value here is in mid-market IT.
There is no added value in the SMB space. We say, ‘You should do that.’ The CEO says, ‘Okay, you’re the experts.’ And we do the work because we are the guys in charge. When we manage a relationship together, we become their supply chain management, their strategic advisors. We’re going to this piece because no one has time to read 19 Gartner reports. Nobody has that time. But if you read four and I read four, then we can settle this matter now.
You will see more and more providers starting to use the channel. Maybe before they could survive without her. But now they are beginning to realize that they need our knowledge. There are so many new programs from HPE GreenLake to Dell Apex to Cisco Plus. They are all great and wonderful. But how can a company roll this out? How many person-hours are needed for the introduction? And IT has to deal with DevOps, cybersecurity infrastructure, work from home, cloud, multi-cloud and Microsoft. It goes on and on and on. Where is the limit? You need a solution provider to come in and help with all of these things. Because otherwise, you could buy a cybersecurity product and it could sit on your shelf for six months because you can’t get it to market.
Are services an important part of your medium-sized company? Or is the focus still more on more traditional products?
It’s a hybrid. It’s more strategic services, sometimes stemming from the COVID experience. Not necessarily the what, but the how and why. I think we’ve looked more into policies, procedures and strategic planning than in the past. Now you are in a situation where every company has written policies. When we help companies do different things, it’s like, “Okay, we can see a clearer picture of where you want to go, where you serve your customers.” That’s why we always give our partners and our customers the best we can to do that they can support their customers. When we support a bank, they support their external users. How do we make this possible? So we start getting closer and closer to the edge because they’re moving there. And when we get to the edge, people start to realize, ‘Hey, I need your team and your expertise. And I need more of a strategic plan and roadmap of how to go from siled infrastructure to cloud infrastructure to hyper-converged to zero-trust infrastructure.” Who will navigate this? That’s what we do best.