Post on 15-Jul-2015
transcript
The Seven Transformations IT Solution Providers Must Confront
Darren Bibby
Program Vice President, Channels and Alliances Research
@darrenbibby
3
Photofinishing Retail
Film Manufacturing
Photofinishing Wholesale
Agx paper and chemicals
Camera retail Camera
Manufacturing Film retail
Memory Manufacturing
D-SLR Manufacturing
Photo Printers Manufacturing
Digital Camera Retail
Photo printers retail
Digital imaging software
Memory retail
Digital compact manufacturing
Rolled & Single use film mfg
Film camera retail
Imaging Industry Profits
http://www.telco2research.com/articles/BR_Silicon-valley-2012-money-moving-are-telcos_Full
1995 - $1.9B
2005 - $3.7B
@darrenbibby
The Kodak Story On Top of the World Market leader for nearly 100 years 1976 – 90% market share in film “Kodak Moment” 1975 - Developed a Digital
Camera
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The Kodak Story Leading the Digital Revolution? Digital camera was quashed by the
powerful Film division 2003 – Fujifilm had 5000 digital
processing labs in USA Kodak had < 100
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The Kodak Story Strategic Responses: Discount Film Catch up in digital cameras Acquire Sterling Drug Create inkjet photo printer business Sue Everyone! Patent Trolling
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The Kodak Story And In the End… Bankruptcy Protection
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0% 10% 20% 30% 40% 50% 60% 70% 80%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
CDSC Owning U.S. Households Smartphone U.S. Households
Imaging Industry – Digital Still Cameras
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Digital Camera Growth
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USA WW
Digital Still -40.7% -30.2%
Interchangeable Lens -23.2% +3.1%
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Digital Camcorder Growth
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USA WW
Traditional Camcorder -22.9% -51.2%
Point of View +34.5% +14.9%
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“There is no such thing as Sustainable Competitive Advantage anymore. Only Transient Competitive Advantage.” Rita Gunther McGrath, “The End of Competitive Advantage”
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@darrenbibby
The Seven Transformations IT Solution Providers Must Confront
Darren Bibby
Program Vice President, Channels and Alliances Research
@darrenbibby
Partner Transformation FROM TO
Technology
Customer
Sales Motion
Time Horizon
Marketing
Activities
Competition @darrenbibby
Partner Transformation: Technology FROM TO
Technology 2nd Platform 3rd Platform
Customer
Sales Motion
Time Horizon
Marketing
Activities
Competition @darrenbibby
Partner Transformation: Technology FROM TO
Technology 2nd Platform 3rd Platform
Customer
Sales Motion
Time Horizon
Marketing
Activities
Competition @darrenbibby
Partner Transformation: Technology FROM TO
Technology 2nd Platform 3rd Platform
Customer
Sales Motion
Time Horizon
Marketing
Activities
Competition
On-Prem to Cloud Software
$127B of Public IT Cloud Services Revenue by 2018
22.8% CAGR 5.5X IT Spending Growth
As of 2014, over 50% of buyer
firms have adopted some form of Cloud.
@darrenbibby
Partner Transformation: Technology FROM TO
Technology 2nd Platform 3rd Platform
Customer
Sales Motion
Time Horizon
Marketing
Activities
Competition
From Servers to Services
IDC predicts that service providers will account for over 43% of total server shipments by 2017
By 2016, over 50% of compute, 70% of storage capacity will be installed in hyperscale data centers
@darrenbibby
Partner Transformation: Technology FROM TO
Technology 2nd Platform 3rd Platform
Customer
Sales Motion
Time Horizon
Marketing
Activities
Competition
Cloud Consumption Model
70% of CIOs will embrace a “cloud first” strategy in 2016
By 2018, it is predicted that nearly 27% of all software revenue will be subscription based.
@darrenbibby
Partner Transformation: Customer FROM TO
Technology 2nd Platform 3rd Platform
Customer IT Business & IT
Sales Motion
Time Horizon
Marketing
Activities
Competition
By 2016, LOB executives will be directly involved in 80% of new IT investments
@darrenbibby
Partner Transformation: Customer FROM TO
Technology 2nd Platform 3rd Platform
Customer IT Business & IT
Sales Motion
Time Horizon
Marketing
Activities
Competition
CIO CMO
Now
Then
@darrenbibby
Partner Transformation: Customer FROM TO
Technology 2nd Platform 3rd Platform
Customer IT Business & IT
Sales Motion
Time Horizon
Marketing
Activities
Competition
FROM IT Complexity
TO Business Outcomes
@darrenbibby
Partner Transformation: Sales Motion FROM TO
Technology 2nd Platform 3rd Platform
Customer IT Business & IT
Sales Motion Deal Relationship
Time Horizon
Marketing
Activities
Competition
Sell Use
Transaction
@darrenbibby
Partner Transformation: Time Horizon FROM TO
Technology 2nd Platform 3rd Platform
Customer IT Business & IT
Sales Motion Deal Relationship
Time Horizon Short Term Long Term
Marketing
Activities
Competition
Typical Project Based Business
Typical Recurring Revenue Business
Partner Transformation: Time Horizon FROM TO
Technology 2nd Platform 3rd Platform
Customer IT Business & IT
Sales Motion Deal Relationship
Time Horizon Short Term Long Term
Marketing
Activities
Competition
Partner Transformation: Time Horizon FROM TO
Technology 2nd Platform 3rd Platform
Customer IT Business & IT
Sales Motion Deal Relationship
Time Horizon Short Term Long Term
Marketing
Activities
Competition @darrenbibby
Partner Transformation: Time Horizon FROM TO
Technology 2nd Platform 3rd Platform
Customer IT Business & IT
Sales Motion Deal Relationship
Time Horizon Short Term Long Term
Marketing
Activities
Competition @darrenbibby
“The stock market values companies with more regular cashflow more highly.”
Tim Worstall Forbes
June 18, 2013
Partner Transformation: Time Horizon FROM TO
Technology 2nd Platform 3rd Platform
Customer IT Business & IT
Sales Motion Deal Relationship
Time Horizon Short Term Long Term
Marketing
Activities
Competition @darrenbibby
“Even if the revenues were the same, the costs the same, the profits the same, moving from a variable revenue stream such as upgrades to a more regular one as in subscriptions should boost the value of Adobe itself.”
Partner Transformation: Time Horizon FROM TO
Technology 2nd Platform 3rd Platform
Customer IT Business & IT
Sales Motion Deal Relationship
Time Horizon Short Term Long Term
Marketing
Activities
Competition @darrenbibby
Partner Transformation: Time Horizon FROM TO
Technology 2nd Platform 3rd Platform
Customer IT Business & IT
Sales Motion Deal Relationship
Time Horizon Short Term Long Term
Marketing
Activities
Competition
Potential Valuation
Traditional Revenue Business
Recurring Revenue Business
Revenue Multiple 0.2 to 1.5 X 2 to 6 X
EBITDA Multiple 2 to 2.5 X 5 to 14 X
Source: IDC Partner Valuation Study 2014
“For the average sub $5 million a year VAR, it’s tough to get past three times EBITDA” Brent Twist, Encore Business Solutions
Partner Transformation: Marketing FROM TO
Technology 2nd Platform 3rd Platform
Customer IT Business & IT
Sales Motion Deal Relationship
Time Horizon Short Term Long Term
Marketing Traditional Digital
Activities
Competition
Internet
@darrenbibby
Partner Transformation: Activities FROM TO
Technology 2nd Platform 3rd Platform
Customer IT Business & IT
Sales Motion Deal Relationship
Time Horizon Short Term Long Term
Marketing Traditional Digital
Activities Resale Pro Services Services
Services Mgd Services Creating IP
Competition
Services to Creating IP
Professional to Managed Services
Resale to Services
@darrenbibby
Partner Transformation: Activities FROM TO
Technology 2nd Platform 3rd Platform
Customer IT Business & IT
Sales Motion Deal Relationship
Time Horizon Short Term Long Term
Marketing Traditional Digital
Activities Resale Pro Services Services
Services Mgd Services Creating IP
Competition
Resale to Services
Services to Creating IP
Professional to Managed Services
Gro
ss M
argi
n
@darrenbibby
Partner Transformation: Competition FROM TO
Technology 2nd Platform 3rd Platform
Customer IT Business & IT
Sales Motion Deal Relationship
Time Horizon Short Term Long Term
Marketing Traditional Digital
Activities Resale Pro Services Services
Services Mgd Services Creating IP
Competition Traditional Non-traditional
Partner Transformation FROM TO
Technology 2nd Platform 3rd Platform
Customer IT Business & IT
Sales Motion Deal Relationship
Time Horizon Short Term Long Term
Marketing Traditional Digital
Activities Resale Pro Services Services
Services Mgd Services Creating IP
Competition Traditional Non-traditional @darrenbibby
@darrenbibby
Partner Transformation FROM TO
Technology 2nd Platform 3rd Platform
Customer IT Business & IT
Sales Motion Deal Relationship
Time Horizon Short Term Long Term
Marketing Traditional Digital
Activities Resale Pro Services Services
Services Mgd Services Creating IP
Competition Traditional Non-traditional
“Culture eats strategy for breakfast.” Peter Drucker
Culture
@darrenbibby
“There is no such thing as Sustainable Competitive Advantage anymore. Only Transient Competitive Advantage.” Rita Gunther McGrath, “The End of Competitive Advantage”
© IDC Visit us at IDC.com and follow us on Twitter: @IDC 46
@darrenbibby
@darrenbibby
“If you don’t like the feeling of change, You are going to like the feeling of irrelevance even less.” Darrin Nelson, Sirius Computer Solutions
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