Last week when one of my esteemed colleagues interviewed Sandeep Menon, director-Linux business, Novell West Asia, she had an obvious question to ask on why did open source community heavily criticized Novell for the partnership with Microsoft. Apt came Menon’s reply: “Passion typically runs high when we approach an Open Source versus Proprietary Software conversation, and the initial reactions were understandable”.
Menon is only doing a good job in defending the deal.
The two vendors have stated in explicit terms that they would collaborate on standards-based solutions that provide scalability and flexibility in managing heterogeneous environments.
Now, whether the deal can show positive results to either of them or only compel the smaller among the two – Novell – play into the hands of the software giant, only time will tell.
But in the midst of these debates, what has come to light is that the future of marketing rests in brand alliances. The co-opetition era has come to stay in the IT business.
Sometime back, two fierce competitors in the motherboard business – Gigabyte Technologies and Asustek Computers also came together to pool each others’ resources and create a “win-win” situation. ASUS has similar tie up with Intel on motherboard though the latter also manufactures the same product.
Many such tie ups have either happened or are on cards. The moral of the story is simple that such alliances are forged only to maximise consumer preference where both companies and brands can see opportunities of reaping mutual benefits. And probably there is also a crucial factor that the threat is not competitive but instead from the consumers.
In today’s fast-changing IT marketplace punctuated with ruthless competitions for the channel, the paradigm of this alliance-building can help enable them to build value across the consumer spectrum. I know of partners who are already doing it. But most of my friends in the channel say such arrangements are either typically informal in nature or are maintained just by word of mouth.
At the same time, most of them realize it well, that partnership among competitors can be worked on well. In cities like Hyderabad and Lucknow a few partners are only working on this line and say the deal need not be aimed at mere survival alone, but is also because they essentially believe that sometimes one plus one is more than just two. A specialist VAR to cater to BFSI segment, Uttam Mazumdar of Locuz points up that while he has basic security infrastructures and business operations, future tie up with networking and security specialists can only help him convince and win over customers.
But as I interacted with a cross section of resellers in cities like Indore, Jalgaon and Surat, sooner it came to light that our country is largely also a land of skeptics where there is a general distrust about anything that we believe can ever help both the parties. “What happens if the other partner closes his shop? This has happened in the past. One fine day my partner announced he wants to go back to textile business and stop dealing in IT,” laments Jalgaon-based R S Wagh of Sri Ganesh Infotech.
Honestly, I have no straight answers to such pointed – and rather socio-analytical questions.
But what needs to be re-emphasized is that if you simply look at the imminent retail blast; co-optetiton will become a necessary business tool. It is this imperative step that will help partners develop the key survival instincts and also to develop them as springboard to the road to profitability.
Take a refreshed look at what Intel has to say on motherboard as the company’s chief market enabler vis- -vis the relationship with ASUS.
“We are clear about certain things. We will continue to do business with processor but also provide motherboard to our partners as the channel struggle for quality and standard motherboards,” says Rajesh Gupta, director – Sales (Channel), Intel Technology India.
The importance of this management concept – share and care – cannot be lost on to our channel partners as well – big or small. The time for sharing business responsibilities and the profit margins among two rivals can be strategic bedrock and sooner the channel can adapt to, it is better.
When vendors like Microsoft and Novell come together, the partners can count on bigger market opportunities because they would no longer be forced to fall into one camp or the other. Don’t you feel your customers would also like to make certain choices on those lines; they buy desktops from one partner and are easily given the choice that your co-partner will provide him networking and security services. The customer goes out making friendship with two of you and in the ultimate both of you win a customer on a very long term perspective.