Some days ago, I attended Directions EMEA in Vienna - the annual gathering of many Microsoft Dynamics NAV and Microsoft Dynamics 365 Business Central partners. It took me a while to digest my impressions, and summarize my key take-aways. Other than many other Directions EMEA reflections that I read and enjoyed, mine is less product-centric, less tech-centric, but more business model-centric.
My key take-away is:
Channel partners all agree that we are experiencing a significant wind of change. One of the most overlooked, but potentially most impactful answer to this challenge is an increased partner-to-partner motion.
With partner-to-partner motion, I refer to both increased and much tighter collaboration between VARs and ISVs, but also between ISVs and ISVs. Of course, my perspective is one of a (non-selling) ISV.
So, let's first look back to where I come from. Second, let's face what we all see as a major challenge, before I, third, shed a light on why (and how!) partner-to-partner can help us all.
Looking back: The hard truth of being a pure "add-in ISV"
When writing from the ISV perspective, let's quickly differentiate two types of ISVs.
- The full vertical solution ISV
- The add-in ISV
The full vertical solution ISV built an entire vertical product based on the Microsoft Dynamics NAV platform and sells this (via partners) as an industry-specific ERP system to end customers. These customers care less for the platform (in that case: NAV), but care more for how that system solves their industry-specific pains. This type of ISV solution typically drives both: service revenue and license sales (both for the vertical solution and the NAV platform). Hence, on average these types of ISV have been on a safe side for quite some while.
Contrary to this, the add-in (or add-on) ISV (like us) provides functional enhancements to the base system. These add-ins tend to drive little service revenue, and also they do not really drive (additional) NAV license sales (in a good case, they help a partner win a deal). However, the risk is that these add-ins typically get taken out of a deal when customers negotiate the price. The other obvious risk was that typically - thanks to the "openness" of the NAV platform - partners couldn't resist the temptation do develop that specific functional enhancement by themselves.
Welcome to my reality for the past years ... - As such, I am somewhat enjoying the current change happening. For an add-in ISV like my company, this change means chance.
Living now: the acceleration of the 'speed of change' challenge
We (from the Dynamics 365 Business Central community) are all in tech, and are all in software. We all are familiar with constant change, and we all have built sufficient strategies and experience to cope with change.
However, most of any conversation I had at Directions EMEA sooner or later tackled the notion that it is not about change anymore. It is about the speed of change, and the acceleration of the speed of change.
I bet that the acceleration of the speed of change is the current no1 "thing that keeps you up at night" for many Dynamics NAV partners.
Here is how this acceleration of the speed of change can be summarized:
- Both the base system, and the architecture, and the technology are changing fast and faster (sometimes being referred to as"brutally" fast)
- The world of SaaS, alongside with the gaining prominence of APIs and events, complemented by new services, new services, and even more new services (Power BI, Power Apps, Flow, AI, Azure Services, etc.) opens up new possibilities.
However, you can only leverage these possibilities if you fully embrace the new. Plus: there is some risk that anybody (even companies that did not act in the Dynamics NAV world in the past) can leverage these possibilities. Plus: maybe they even can do this better as what is new to us is already common to them.
So really, and this is one of the a-ha moments I had at Directions EMEA:
The hard truth of being either a VAR or an ISV in these days is: most likely, you cannot embrace the speed of change on your own - fast enough.
Tough shit. What to do?
A surprisingly boring answer to the 'speed of change' challenge
A prevailing sentiment that I heard at Directions EMEA: given the speed of change, there is so much to do, so much to take care of, so many things to take into account, so much to learn anew, we do not know where to start.
Well, to me the answer to this is obvious, and I like to quote Alexander Graham Bell:
Concentrate all your thoughts upon the work at hand. The sun’s rays do not burn until brought to a focus.
The answer is concentration, the answer is to focus.
The 'speed of change' challenge should force partners to focus on where they are good at, on where they excel, and on where they can bring the biggest value to their clients.
Then, when a lot of companies actually focus, we might come into a situation, where we have not many average, rather broad horizontal solutions, but a lot of world-class, rather narrow vertical solutions.
If these solutions - in a partner-to-partner motion - would get combined, the dream of 1 plus 1 equaling 3 could become true. Focus definitively will help here a lot.
Looking ahead: partner-to-partner a true love-hate?
I am not naive. I know that this sounds like a nice theory. And I also know that many theories fail when they need to do the on-road test.
When I was considering a new partner-to-partner opportunity earlier this year (more of this below; stay tuned!), I recognized that it can be seen as a true love-hate relationship. It brought me into a situation where I had an angel left and the devil right.
Partner-to-partner: what the devil tells you
Of course, when thinking of a partner-to-partner collaboration, the devil speaks loud and clear.
- This is not what you aim for. You aim for being independent.
- You are forced into this situation. The speed of change forces you into it.
- Microsoft forces you into it. Gone are the golden days that partners determine the best solution for customers. Customers will do by just picking from AppSource.
- You are the entrepreneur. You shouldn't do what you are forced to do. You hate being forced. You are an entrepreneur because you love being independent.
Partner-to-partner: what the angel tells you
No night without day, no devil without angels ;-) Here is what they let me consider:
- Partner-to-partner gives you the option to focus. You and your company are good at visual scheduling. Excel in that. Focus on that. Don't get diluted.
- Let others do what they can do best. Don't get in their ways, as they (most likely) won't get in your way. If you excel in what you are good at, they'll acknowledge this.
- If you become world-class in what you, you ultimately solve for the customer. You are an entrepeneur. Entrepreneurship is not about being independent. It is about maximizing the value for the customer. Solve for the customer, dude. (Actually, I was surprised that my angel called me dude!)
Conclusion: I embraced it, and you can do as well
Earlier this year, this angel-devil dialog happened to me. One of our competitors suddenly left the market, and a door went wide open. As stated, we are good at visual scheduling. The open door was beyond where we are originally good at. It was about advanced planning and scheduling, and it was all about advanced manufacturing for Dynamics NAV / Business Central customers.
While I started to think through our options, and if and how we would approach walking through this door (or focusing on our strengths and walking away), James Crowter from TecMan called me. He suggested a partner-to-partner collaboration as follows:
- NETRONIC brings visual scheduling, a network of international partners, and international sales and marketing skills to the table
- TecMan in turn brings NAV / Business Central knowledge, 25+ years of experience with manufacturing clients, plus experience with the market-leaving competitor to the table
NETRONIC focuses on where we excel. TecMan focuses on where they excel. Partner-to-partner. Solve for the customer.
Good-bye Mr. devil.
I embraced it. I manage to overcome the sentiment of "this is not what I want". I actually embraced that partner-to-partner happens also elsewhere in the market place. It is not specific to Microsoft Dynamics 365 Business Central.
It is just a compelling answer to the 'speed of change' challenge. Not more. But also not less.
Role-model: how partner-to-partner can actually work
James and I had the partner-to-partner discussion in Q1 this year (2019). Since then, we and our teams have been working on the Visual Advanced Production Scheduler (VAPS) for Microsoft Dynamics 365 Business Central. Last week, we started shipping this product to the first beta partners, and aim at a GA by the end of November.
That means: I am not at all a partner-to-partner champ with a zillion of years of experience. However, I have been engaged in a true partner-to-partner collaboration (combining strengths for joint product development to solve for the customer) since early this year. So far, this has been working out very well. Actually it is so well, that we are confident enough to ship a product to which both of us contribute.
When I reflect these past few months that now culminate in a product release, I tend to name the following few "things" as cornerstones of a successful partner-to-partner collaboration. I just list them for now but may elaborate on them in a later post (if you are interested, which you can indicate in the comments)
- Sharing is way more important than keeping
- 'Just do it' attitude
Last, but not least, what Nils said in his keynote speech at Directions is also true for a partner-to-partner motion: The fast ones win.
What are your thoughts on partner-to-partner? Which experiences have you been making? Would you like to read more about our experience with this new motion? Please share in the comments below.
Also ... if you are interested in getting to know the VAPS better, please book a meeting with a production scheduling expert for Microsoft Dynamics 365 Business Central: