Kathy Gibson reports from Oracle PartnerDays in Johannesburg – IT value-added resellers (VARs) are not necessarily sure about where they should be going on their own future journeys.
“For many partners, there is a lot of uncertainty,” says Jean-Marc Gottero, vice-president: cloud go-to-market at Oracle EMEA. “The business is changing; there is a lot of disruption and partners don’t always know where they should be going.”
Gottero believes, however, that partners should be moving fast in order to reap the benefits offered by the cloud.
Industries are changing at an unprecedented rate, he adds. Companies face the challenge of new entrants, new business models, ever-increasing customer expectations, and new workforce expectations.
An IDC CEO study indicates that technology is now the top priority – for the first time in history, technology is highly relevant in the business. “So we need to bring the value of what technology can offer, to help businesses offer their customers and staff expectations.”
On the Fletcher School digital evolution index, South Africa is moving rapidly towards the top right-hand quadrant.
“Cloud is the solution for many of the questions companies are asking,” he says. Cloud offers less capex and lower maintenance costs, so it has economic advantages.
“It also enables innovation,” Gottero says. “For instance, you can access new technologies immediately using the Oracle Cloud.
“Cloud puts all countries on the same level when it comes to adopting technology.”
Gottero points out that, while Oracle has not historically been perceived as the most partner-friendly company in the industry, it is committed to partnering.
“Two things are required to be successful in this market: and platform and a path,” he says.
The platform is the cloud, and the path is the ability for every customer to get to the cloud at their own pace and on their own terms.
“We have invested billions of dollars in developing the most complete cloud,” Gottero says. “We offer a complete, open and secure platform that spans all layers of the cloud and provides choice.”
The success of this investment shows in the almost 3 000 cloud deals that have been won in the last 12 months – 50% of them through business partners.
“We have the broadest platform on the planet,” Gottero says. “Gartner says we lead in most areas of cloud services. The only place we don’t have the leadership position is infrastructure as a service (IaaS), which is a solution we just launched recently.”
Overall, 25 000 Oracle customers have migrated to the cloud, Gottero says – and Oracle is quickly moving to the next phase of technology.
The company recently announced Sparc M8, Sparc T8, Oracle Database Appliance 7, Oracle Exadata X7 and Oracle cloud machines, among others.
“We are also committed to platform innovation,” Gottero says, pointing to recent announcements in the platform: in new middleware platform as a service (PaaS) services and an IoT application cloud.
New announcements in software as a service (SaaS) include intelligent bots, adaptive intelligent apps and Oracle data as a service (DaaS).
“We are innovating: Oracle is not a fast follower anymore,” Gottero says.
The path to cloud is covered by Oracle’s six journeys to cloud, Gottero explains. These cover the different cloud architectures, and how customers can get there.
“With Oracle you can navigate, and you can build a repeatable business,” Gottero says.
“Customers want to squeeze cost and innovate. If you can reduce the cost from maintenance, you can free up money to invest into innovation – that is how customers will go to a digital state, to industry leadership.”
For partners, they can not only help customers achieve their cloud goals, they can retain the customer on a managed services basis as well.
He points out, however, that this is the biggest transition ever for the channel. “We have to recognise it is not easy to go to cloud. How do you do that?”
The first thing is to understand the change in the business model. “For instance you no longer have to talk to IT people, but to business people. Do you have the people in your company who can do that?”
Specialised services are also important. “You need to be an expert in one domain and grow from there,” Gottero advises.
Sales, marketing and resale opportunities are different as well. “There is also money in professional services and managed services. Partners have to build specialist services and start working with other partners.”
Gottero believes that Oracle Cloud offers partners a path to the cloud as well. They can move from where they are today to business consultancy on SaaS; then to implementation services by pillar; then business transformation with integration, business intelligence and managed services; then having their own IP – industry-specific solutions with third-party integration.
Technical systems integrators, independent software vendors and value-added resellers would all have their own journeys that will get them to a leadership position in the digital space.
One challenge for partners is the revenue depression – the trough where one-time revenues have declined but annuity revenues have not yet replaced them.
“We don’t want you to lose your one-time revenues, though,” Gottero says. “You need to form a team that builds the incremental revenue. As this business grows, you can move resources across.
“We can help you to have the right business plan to get through the transition.”
Currently, 80% of business in the cloud environment is in migration, and this is where partners can start making money, he points out.
Moving to cloud can help partners make good money, Gottero adds. These include 50% to 60% growth in revenues. Margin can increase by 40% to 50% on managed services, while 65% to 70% growth can be seen on IT solutions – all of which can result in a doubling in company valuation.
Oracle has introduced new OPN enablement resources including the Cloud Excellence Implementer (CEI) programme that helps customers make a smooth transition to the cloud through Oracle implementation partners.
The programme recognises and rewards those partners who have invested in building their Oracle Cloud expertise and demonstrate a proven track record for delivering high quality cloud implementation projects across Oracle’s customer base.
With the CEI distinction, partners that work with Oracle to implement Oracle Cloud around the globe will be able to further differentiate themselves in the marketplace, and benefit from increased enablement and go-to-market support from Oracle.
At the same time, customers will be able to more easily identify partners with the specific expertise and proven track record they need to successfully navigate their transition to the cloud. The CEI program is available to OPN members now and will initially focus on implementations for Oracle Cloud Applications.