Comms Dealer

Every business leader's primary duty is to survive. From diehard traditional dealer to modern system integrator, all know they must adapt or die by becoming creatures not of habit, but context.

And in the context of Digital Darwinism organisations need to adapt more quickly than ever before, according to Alex Tempest, Director of Partners at TalkTalk Business.

"Disruptive innovation - mobility and cloud computing - is influencing how business operate," she said in a Comms Vision keynote presentation. "Digital is disrupting businesses and whole industries. Forty per cent of incumbents are likely to be displaced during the next five years if they fail to embrace digital.

"However, technology-driven transformations are only possible with a first class network that can deliver the 'power of now', the power of agility and performance. This needs investment - the agile world is far removed from dumb pipes."

TalkTalk Business is looking beyond 'survival of the fittest' and is deep into an investment-driven phase of bleeding edge evolution. "Innovation is about reacting quickly and long-term planning," added Tempest.

"We are investing in Network Function Virtualisation (NFV) and Software Defined Networks (SDN), both virtual solutions that provide choice. This will be one of the most disruptive forces ever seen in the industry."

The network operator has committed £300 million-plus in a programme of investment that will greatly increase bandwidth, while offering more network control and visibility via useful portals and APIs, all designed to put the power of the network into the hands of channel partners.

"The initial phase looks at legacy voice and data, creating wholesale FTTC and an Ethernet network, underpinned by real-time technology that mirrors the software industry, promoting faster product development and the accelerated roll out of products and services," added Tempest.

"This improves how businesses interact with customers with faster response times, faster access to critical information and improved collaboration. But supporting businesses to become digital and more agile depends on having a first class next generation network."

Dazzled by newness the comms industry has lost the power of scepticism, the result being a disproportionate overselling of the 'new' and neglect of what is really happening on the ground, according to Bob Falconer, CEO at Gamma.

While resellers are not yet wholly duty bound to put their shoulders into holding back the seeming threat of a rampant techno revolution, their chief topic of conversation should nonetheless emphasis the durability of past innovations such as the PBX and what to do about their inevitable decline.

"Every year there is talk of a change in the model," said Falconer in a characteristically lively Comms Vision keynote address to delegates. "We're cynical, it doesn't work like that. Change is there, but it's pernicious and slow."

In the consumer world it is eye watering to witness how quickly this year's techno dazzle can look clunky, but in the business environment research and development do not equate with the viral neophilia that drives immediate market adoption among everyday users. Yet change is most certainly on the creep.

"The balance is shifting with less equipment installation, while the resale of commodity services is tough," said Falconer. "We see fewer tech hobbyists, it's a skilled game in the infrastructure now. "The rise of professional services is making life easier for customers, removing their burdens and solving problems while introducing disruptive options."

Even though technological innovation is always hyped, the truth is that resellers do, for better or worse, have a date with history. This is a question of leadership and how growing threats are managed.

"A big threat is Amazon Web Services offering a server for 20p per hour, £150 per month, £1,300 per year," said Falconer.

"How do we compete with that? Google Apps for Work is available at £3 to £7 per month. We have the rise of Microsoft, and BT buying EE with plans to integrate fixed and mobile. This is all on a huge scale, cheap, deeply converged and coming to a customer near you."

The channel has a long tradition of giving customers a personal service, tailoring to the needs of vertical markets, getting to know every crook an cranny of the market and taking away their customers' headache, making the channel the 'best sales force', believes Falconer.

"This is what the big boys can't do," he said. "They mainly don't have feet on the ground, so resellers can effectively counter these threats. But if they can't add value they're not in the game."

Despite their long heritage of impeccably serving end users, resellers can only expect the glory of business growth if they align their product and services strategy with Falconer's model template for future planning, he suggested.

"Companies want to buy bundles from one supplier, so broaden your portfolio," he told delegates. "It's risky to wrap your business around a single supplier and tie your success to them. Seek three or four suppliers that collectively give you the capability to cover the full spectrum in a manageable way."

Gamma's strategy is to have two or three products in high growth disruptive markets, such as SIP and Horizon, augmented by commodity products, broadband, Ethernet and calls, for example. Then add a wrap around the proposition - training, sales and tech support, useful portals etc.

The business model is to identify future winners, get ideas to market quickly, from 'flash to bang' in 18 months to two years. This game plan keeps Gamma's 120-strong development team busy working on exciting new products for the channel.

The current priority is mobile. The company is set to launch 4G services next spring and by offering deep integration of fixed, mobile and data Gamma is set to be a fast-rising aid to mobility. This is surely the start of a new power play.

This latest product development phase began last year when Gamma completed the acquisition of a core mobile network and has since been working hard on its asset, an effort that will be realised in Q1 2016 with the role out of Gamma Mobile as a full Mobile Virtual Network Operator (MVNO).

"Recognising that mobility is a key component of business communications, and that choice in the market is reducing potentially down to three players, we made a decision to launch Gamma Mobile," stated Falconer.

"We have the core capability of a mobile operator except the radio access, and recognise the importance of mobility in an increasingly converged world."

Gamma CEO Bob Falconer told telecoms and IT business leaders at the 10th annual Comms Vision Convention at Gleneagles on November 5th that he plans to be supplying 4G services to the UK business community from Gamma's own core mobile service by next spring.

"Recognising that mobility is such a key component of business communications, and that choice in the market is reducing, potentially down to three players, we made a decision and it was a big decision for us, to acquire and build the core of a mobile network," he said. 

"We completed that acquisition last year and have been working hard on it since. 

We will shortly become a Full Mobile Virtual Network Operator (MVNO), which means we will have all the core capability of a mobile operator, except the radio access. We recognise the importance of mobility in an increasingly converged world and this is a core component."

Nothing should detract from the task of preparing a business for ongoing positive action, stated Lee Shorten, Independent Consultant and Advisor, especially for comms suppliers, considering that the UK ICT market is estimated to be worth £135 billion.

Shorten's inspirational keynote may prove to be a significant moment for many delegates, who, while outstanding leaders, would benefit from his clear advice on how to become a long-term favourite to win.

"Monetising the assets resellers have already created is a big opportunity," he said in a keynote to Comms Vision delegates. "The potential for growth and building inherent value is significant."

There are good reasons for developing a passion for business fitness and all measures to achieve this happy state are available and within reach with a little vision .

"Business owners often base their companies on what's in front of them, or a company may be built around the personality at the top," said Shorten, who has worked thousands of channel partners in his career. "In such cases there needs to be a better balance.

"How often is there a stopping point in your business to assess where you are. This will help to build a systematic approach to looking at the factors affecting your business, and establish processes that will get your company into the best possible shape."

In terms of value, the EBITDA multiple is less relevant than synergistic value, pointed out Shorten. A business can be measured on performance, sustainability and its go to market strategy, how well it delivers to customers, or its strategy to find talent, develop customer relationships, enhance sales and marketing process (tracking activity and measuring lifetime value) etc. "Is your market proposition really different?" asked Shorten.

It's time for a dose of reality. "Ascertain your exit options, set a timeline and build your business with these options in mind," urged Shorten. "Do you know who your top ten customers are? Sometimes business leaders can't even pick out metrics like this to manage their best prospects.

"Find a balance between the push for profit and maintaining customer relationships. Use scorecards to continually improve your business. Hold regular strategy reviews and involve your staff. Don't do this in a dark room, staff want to be part of the journey. The result is a performance culture and a great place to work."

If resellers are to find true differentiation they should extend their thinking on company culture, argues Darren Rudkin, Managing Director, The Mind at Work.

No business leader is going to find the development of a company culture easy, but Rudkin set about giving Comms Vision delegates some practical advice that will only mean something if leaders behave like leaders.

"Leadership teams in top performing companies spend significantly more time getting aligned than ordinary companies," he said.

"Leaders in these companies see it as their job to create the heart of the company, then create the conditions and culture that both brings this to life and invites others to step forward and bring it to life for themselves.

"They see culture as a key driver of competitive advantage. Role modelling the values and heart of the company by the top team is passionately held which means that the creation of strategic direction is regarded as anything but a purely intellectual exercise."

Culture is an unwritten code often created by leadership to set standards of behaviour and expectations.

"Innovation culture is about expectation," he added. "Trying out new ideas, looking for external stimulus and constantly learning."

According to Rudkin the anatomy of innovative culture is talent, expectation, structure and recognition.

"Don't hire in haste, find the talent that's right for you," he said. "It's your job to define talent and source it. Penetrate interview techniques with creative acts, and design experiences to ascertain a culture fit.

"Let talent recruit talent, people want to work with great people, and give them roles that make a big difference, it's motivational."

In terms of expectation, people expect to do different things to make a positive impact. It is the leadership role to create such an expectation, perhaps based on the following concepts cited by Rudkin: Data beats opinion, doing beats talking, simple beats complex, now beats later, commitment beats committees, and fast failure beats slow perfection.

"What is your attitude to building a structured route to innovation?" asked Rudkin. "You need a bold attitude. Identify your key axis for innovation and invest disproportionately in those areas."

Last but not least, recognition for doing a great job is the most important motivating factor in culture, according to Rudkin.

"Structure expectation and recognise it," he added. "The people at the top should be engaged in that process."

About Darren Rudkin
Darren is a speaker, coach, teacher, facilitator, author and creative business thinker. Before setting up his current business specialising in the art of leadership in 2004, he was a senior leader in Unilever's detergent business, and a co-creator of the award-winning innovation company ?What If!, which specialises in innovative product development and creative leadership practise.

He uses this experience to help organisations to create energised cultures which know how to release the discretionary effort and motivation of their people, based on real experience and not management theory.

He specialises in mindset and behavioural change and the development of conscious leadership that is strongly aligned to strategy and purpose.

The job of sales people is no longer selling, it's forming relationships that stand the test of time, said Pete Tomlinson, Director of Product, Marketing and Sales at Eclipse, in a Comms Vision panel debate.

"This paradigm shift is cultural in nature," he said. "Companies must organise around building long-term relationships with customers. A big focus for us is to drive user adoption and reinforce lifetime value."

There is clearly a case for re-imagining the role of sales people, but it must also be understood that customer relationships can be cemented by less obvious people in the business.

Joe Murray, Channel Director at essensys, said: "Software engages customers in the lifecycle, and 50 per cent of our staff are software engineers. So the long-term development and monetisation of customers comes from a different part of the business."

At its extreme, complexity is the catalyst of decline and squandermania - the sensible strategy is to keep things as simple as possible, according to David Axam, Director, Hosted Communications, BT Wholesale.

In precise form, Axam addressed Comms Vision delegates from a position of authority on how to resolve complex matters for the better. Ironically however, simplicitly is difficult to achieve, he said from experience.

Early in his career Axam helped to build some of the first VoIP products. His challenge was to ship more of them.

"Simplicity was the key that has since shaped my thinking," he said. "Simple product modifications transformed shipments of 100,000 units to literally millions.

"In the UC world there are so many possibilities but the danger of choice and richness is that we forget the simplicity. We must keep the richness but add simplicity."

Axam moved to his new role in April this year and applied his proven strategy to promote simplicity, aiming to repeat his earlier trick with straightforward strategic modifications that make all the difference.

"In April I set my direction," he said. "And introduced clear and simple propositions that add choice."

He noted that the relationship between simplicity and increased effectiveness is undeniable, and he has applied his thinking to 'simple unambiguous' partner relationships, also based on a simple premise, that people buy from people.

"We introduced channel managers and have 46 per cent more orders as a result of the people-factor," he said. "It's about converting hearts and minds by building trust."

Digitalisation is here to stay. Long gone are the days when doing business was about finding a niche, creating a product and shifting as much of it as was humanly possible.

Also slung in the historical dustbin of industry priorities is the evolved services business that emerged during the '90s. Today, customer centricity reigns, and what we do about it is the difference between success and failure, according to Pete Tomlinson, Director of Product, Marketing and Sales, Eclipse.

"The industry must move to a relationship-centric model," he told delegates in his keynote address. "Customers have a new expectation based on outcomes, not ownership. We've moved from selling boxes to partnering with customers on their outcomes."

The outcome of a survey of 150 IT leaders conducted by Eclipse offered new insights into what really matters to them. Despite 84 per cent of respondents understanding technologies such as UC, 68 per cent were clueless about what to do with it.

"They need help with the actual 'how'," added Tomlinson. "This is a massive opportunity for the channel."

This end user knowledge gap could be the grandest unexploited revenue source to date, and resellers with a customer-first approach stand to gain most.

"In our survey, 77 per cent of IT leaders stated that supplier relationships built on trust and confidence are more important than the features and benefits of a solution," said Tomlinson.

Their readiness to sacrifice functionality in favour of trusted partnerships extends further, with 60 per cent ranking product roadmaps as a preference when selecting a supplier. This means that the tech-centric model must become user-centric.

"The starting point needs to be a conversation around customer personas," said Tomlinson. "Not a discussion about which part of the technology stack needs to be replaced. There are different personas within a business, with varying user profiles and different needs that must be addressed."

In this model a single sale will not cut the mustard, but mapping out the customer's lifetime value will be far more lucrative, even at low margin entry points in the relationship with higher margin service provision highly likely further down the line following cross-sales based on consultation and advice.

"Our industry has been good at giving away its most valuable asset - knowledge," added Tomlinson. "We are moving away from products towards higher value in knowledge and consultancy. Successful resellers will have the confidence to monetise their knowhow and create a consistent customer experience built on a culture of innovation."

The comms industry's biggest, most plentiful digital opportunities can only be realised by embracing data, according to Richard Robinson, Managing Director and VP EMEA at Turn.

In a Comms Vision keynote address he said everything is to play for, but old marketing methods must go, and resellers will lose out if they stick to traditional marketing roles.

Robinson pointed out that marketers now rank customer experience optimisation as the most exciting opportunity, and perhaps the most disruptive change to marketing practices in memory.

"Consumer behaviour is transitioning into business behaviour," he said. "Customers are demanding a better experience around personalisation.

"The traditional approach to marketing has limitations, being linear and spread too thinly because people are now self-directed in their buying habits."

He noted that B2B buyers are 57 per cent of the way through the procurement process before approaching a brand. "The challenge is a complex fragmented media landscape which makes being discovered difficult," he added. "It's about how customers find information through multiple paths to purchase."

Given the self-directing nature of today's buying process it is no surprise to learn that 80 per cent of consumers feel brands do not treat them as individuals. They want a customised approach.

"Businesses need to reach customers at moments of most influence, which is difficult to do if you don't know who they are," said Griffin. "But this data can be captured by registering for downloads for example. Data is at the heart of customer engagement strategies."

He segmented data into three categories: Leads generated from websites and CRM systems; data from partners and vendors that enriches customer profiles; and the creation of a data management platform and demand side platform - all designed to uncover a hidden audience via insights that bring the power of personalisation, enabling marketers to target people around their topics of interest while also understanding RoI.

Robinson summed up the implications of these trends for comms resellers: "Put the customer and their journey at the heart of your approach," he commented. "Use data to engage with customers and empower the way you do business with them."

All this is just part of the bigger picture. There has been a 70 per cent increase in the number of people involved in the buying cycle, while 45 per cent of decision makers are millennials (born after 1980). With 90 per cent of millennials using social media and smartphones - the writing is in the wall.

"There is no single person in the the buying cycle," added Robinson. "Different individuals within organisations are influential, all researching technology and how it relates to them and their requirements.

"It is critical therefore that we have a connected, consolidated view of the customer across all touch points."

Digital services company Atos is to acquire Unify from Gores and Siemens.

Atos intends to create an integrated proposition for unified communications and real-time capabilities enhancing social collaboration, digital transformation and business performance.

The transaction is subject to employee representative's bodies' information and consultation and the approvals of the regulatory and antitrust authorities. Closing is expected in the first calendar quarter of 2016.??Thierry Breton, Chairman and CEO of Atos said: "The contemplated acquisition of Unify will increase our offerings for the digital transformation for our customers.

"They are looking for seamless services solutions for their entire digital portfolio and a reliable partner that can service their needs end-to-end. Unify portfolio and customer base is a perfect match that complements existing Atos digital capabilities".??Alec Gores, Chairman and CEO of The Gores Group, stated: "Since the start of our joint venture with Siemens AG, we embarked on a transformation plan focused on operational excellence and meeting the needs of our global customers. Together we invested in innovation, rebranded the company, recruited an impressive management team, and transitioned the business to a channel-driven, software-first company.

"We believe Unify is well positioned to take the business to new levels of success and performance with the support of its new shareholder."??Joe Kaeser, President and CEO of Siemens AG, added: "I am convinced that Atos is the perfect solution for a sustainable future of Unify and its customers. Atos is a proven and a trustful partner and a specialist for successful integration of acquisitions. At the same time, we are diligently executing on our Vision 2020, focusing our business and position Siemens along the value chain of electrification, automation and digitalisation."??Founded in 2008 as Siemens Enterprise Communication and headquartered in Munich (Germany), Unify is a joint venture between The Gores Group (51%) and Siemens (49%), active mainly in Europe and in the Americas.

With 5,600 employees and active in over 60 countries, Unify today generates €1.2 billion revenue.