2017 was another busy year for Microsoft. We rolled out the One Commercial Partner operating model, which strengthened our commitment to help partners around the world build their businesses, take their solutions to market, and close more sales. We also mapped out how Microsoft and partners can work together to help customers innovate and unlock the power of cloud technologies.
The opportunity over the next few years is staggering. According to International Data Corporation (IDC), investment in digital transformation initiatives will reach USD $2.2 trillion by 2019 - nearly a 60 percent increase from 2016. That kind of growth presents incredible opportunities for us to bring digital ambitions to life.
So: Are you set up for success in 2018? Are you ready to build on the growth your company saw last year? I asked Microsoft leaders from across the company to be an extra set of eyes to help you see what's coming next. Below, you'll find each of their unique perspectives, as well as my own, on the partner opportunities in the year ahead.
Corporate Vice President of One Commercial Partner
No. 1: The creation of all-new business models
In 2018, I expect introspection and specialization to be top priorities for partners and customers. Business decision makers will be asking their teams:
- What separates us from the pack?
- Where do we add core value to our customers - business?
Those are two critical starting points for any business preparing for digital transformation. The answers, combined with changes in technology, may completely change a company's business model.
A good example is with systems integration requirements, which are now easier to manage. A customer's environment can be assembled with the core building blocks on the cloud platform, as opposed to being dependent on the customer's unique on-premises hardware environments. That enables SIs to build repeatable offerings and identify what differentiates them.
For instance, let's say a partner's core value is an unparalleled understanding of the market and deep trust of their customers. With fewer complex integration requirements, they can now focus on the data management parts of their solutions. Another partner may decide to cross over into managed services. While it may not have made sense before, they'll no longer have the heavy burden of a capex environment and can more cost-efficiently manage their customers. Those are just two examples in which partners can manage on behalf of their customers in new ways and tap into Microsoft's industry-leading partner ecosystem. Learn more about the Cloud Solution Provider program.
Corporate Vice President of Microsoft Services
No. 2: The advent of micro-revolutions
Every successful company is on a journey to become a digital business. However, leaders are up against the fact that they can't future-proof their businesses. The rapid pace of technological change, coupled with shifting market forces, is leading them into a period of intense, continuous evolution. There's a lot of opportunity, but it's not without risk.
So where do you start? Successful digital transformation starts by helping your customers to identify their desired business outcomes. But the reality of a world where technology is evolving so quickly is that most digital transformations don't start with an organization-wide plan of change, but rather with a series of micro-revolutions. These are small, quick projects that deliver positive business outcomes and build over time to a larger shift in direction. This digital momentum is critical in helping your customers embrace a digital culture and realize their digital dreams.
Corporate Vice President of Industry
No. 3: Cross-industry cloud innovation will drive digital transformation
Our customers are leveraging technology to reshape how we live, work, conduct business, and access services. Digital innovation empowers us to tackle tough societal challenges around the world. As we listen to our customers and partners, we've learned that while organizations transform at different speeds, there are synergies and opportunities that cross industries.
At this time next year, new data-rich technologies and business models will be even more deeply embedded across our industries, helping us to address markets and services that we haven't yet anticipated. The companies that will succeed in the long term are those using machine learning and artificial intelligence to generate new insights and data applications that can exceed customer expectations.
The opportunity for partners now is to start working with their customers to understand their data and learn to use it more efficiently.
Corporate Vice President of Commercial Growth
No. 4: Having a solid GDPR strategy will be essential
In every customer conversation I have, the focus eventually turns to data. How a customer manages data, and the concept of modernizing the "data estate," is increasingly top-of-mind for CEOs and CIOs. Everyone wants to unlock the power of machine learning and AI but, as one of my colleagues likes to say, "If you don't have your data in order, machine learning will simply help you make a wrong decision with a higher degree of confidence."
IDC estimates that General Data Protection Regulation (GDPR) represents a $3.5 billion security products and services opportunity for partners and customers working to comply with GDPR rules. And the May 25, 2018 deadline from the European Union is approaching rapidly. GDPR can be the entry point to a rich conversation to help customers better understand their longer-term data strategy and value-added services a partner can provide.
Corporate Vice President ISV and SI
No. 5: The Internet of Things will redefine what's possible
IoT is no longer a fringe technology - it's now considered an essential part of a truly digital business. Thanks to IoT, businesses in every industry are experiencing the benefits improved efficiencies, increased productivity, and reduced downtime. By the year 2020, manufacturers will invest $70 billion on IoT solutions that connect customers, employees, plant operations, and workplaces. Customers such as Rolls-Royce, Hershey, and Kohler Co. have already invested in Microsoft IoT technologies and solutions to reveal valuable insights.
With the increased amount of information available as systems, assets, people, and processes are connected, customers can also explore converting their data into artificial intelligence (AI). At Microsoft Connect 2017, Scott Guthrie talked extensively about how we're putting (AI) into the hands of every developer.
For partners, understanding how to help customers capitalize on the IoT will open up opportunities for services and solutions around compliance, security, and management. To help you get started, we're delivering online and in-person IoT in Action events that will help you make the most of IoT.
General Manager Channel Sales, One Commercial Partner
No. 6: Heightened focus on the customer experience will drive sales
As companies evaluate how they use technology to enable digital transformation, the way they make their IT purchasing decisions will continue to shift. Cloud computing has democratized not only how business solutions are built and delivered, but also how customers identify, evaluate, and choose solutions. It's no longer just an IT sale. Increasingly, technology buyers are the business decision-makers who want to use technology to support and enhance their businesses.
When talking with customers about the solutions you offer, you should articulate the value proposition for the technology with the customer experience in mind. To prepare, take a look at the resources we offer in the Partner Marketing Center. There you'll find materials such as sales presentations, white papers, market research, sales tools, and digital web content organized by product, solution, and industry for easy reference. You can use that information to help your customer connect to the value your solution offers and establish your role as a trusted advisor.
General Manager Partner Development, One Commercial Partner
No. 7: We'll deepen our customer relationships by helping them and manage their cloud and applications and services
According to Forrester, more than 50 percent of enterprises will have adopted cloud technologies by the end of this year. For managed services providers (MSPs), this means opportunities around managing cloud infrastructure and, perhaps more importantly, aligning to customer business outcomes via application-level cloud lifecycle management capability.
MSPs will have more opportunities to deliver services such as provisioning, management, monitoring, security, governance, and optimization. By investing in automation and cloud tooling and being proficient at cloud infrastructure management, partners offering managed services may be able to increase their margins.
To be successful, partners must invest in capabilities around integrated application-level monitoring and lifecycle management, DevOps as a fundamental approach, and cloud native app development. Many customers will need hybrid cloud deployments - a perfect opportunity for Microsoft Azure Stack.
MSPs that are ready to transform their own businesses and increase profitability should consider how they leverage public cloud infrastructures, and we'll see a growing number of them migrate their customers from their own datacenters to Microsoft Azure to provide differentiated cloud services. Atmosera, Hosting.Com, Synoptek, and Extrinsica are already moving customers from their existing datacenters to Azure.