Forrester finds channel lukewarm over managed services

Research from analyst house Forrester has indicated that the vast majority of resellers are yet to make any move to adopt a managed services model

Resellers might not be flocking to adopt the managed services model in quite the numbers some in the industry were hoping with the vast majority not showing much interest in changing their approach to the market.

According to research from Forrester currently 12% of channel partners are offering managed services, which on average contributes 15% of their overall revenues, and a further 5% plan to get into the market in the next two years.

But that leaves more than 80% of the channel yet to establish a managed services business, a figure that has raised eyebrows at Forrester, which has surveyed the current state of the market in its Seeding the Cloud Channel report: "Considering the high growth and lucrative returns of the managed services market, channel partners' lack of interest in building a managed services business model is surprising."

The reasons given by resellers for not making the move included just simply not being interested in managed services along with an unwillingness to change their business model and high infrastructure costs.

"But resisting business model change will leave value-added reseller partners in the dust of those that embrace change," stated the Forrester report.

The positive findings from the analyst house were that resellers were investing in the right solutions, with many including cloud products in their portfolios, and there was a call for more help from vendors in getting more partners to go further down the managed services track.

"The next step for vendors is to train their partners on their business model transition; for example, selling services, identifying skills and hiring resources, operations management, legal issues and financial management," stated the analyst house.

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The point here is that whether or not resellers are interested in offering managed services, it’s what their customers think, and expect of them, that really matters. At Xerox, we’re finding an increasing number of our resellers are not only moving into, but taking a lead in, managed services.

Entering managed services needn’t be a huge investment either. Take, for example, our channel managed print service (MPS) offering, Xerox Partner Print Services (XPPS) - a comprehensive set of tools, services and support that enables partners to provide customers with a better way of managing office print costs and infrastructure. XPPS is positioned to help partners adopt a services-led approach, without significant investment, thus limiting the risk.

Through XPPS we’re building on our large direct experience and making it available to our partners, providing access to our global supply chain and delivery centres. Through training and special events we’re helping them leverage this experience and making it easy for them to deliver MPS solutions that meet their customers’ individual requirements.

Offering MPS doesn’t mean that resellers have to become a services delivery organisation. This is an opportunity without that investment. Our scope, skill and critical mass are available - the dealer doesn’t have to invest in resources such as a helpdesk for example - they can utilise our infrastructure and just resell. We also offer multi-brand support for partners to manage multi-vendor fleets; this is the fastest growing area.

If the customer wants a traditional lease plus a break fix contract the partner can always offer this without compromising their premium market offering, MPS, and in some circumstances that is the best approach. The key is that channel partners need to be able to offer the best proposition based on customer requirement and customer expectation and with XPPS from Xerox complemented by a more traditional approach they have a winning formula whatever the circumstances.

Mark Duffelen, director and general manger, Channel Group, Xerox UK
@MDuffelen
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