Trevor The opportunity for resellers is finding the person inside any organisation that actually takes up the mantle and wants to make a difference. A lot of them [in these organisations] are used to doing bill-of-materials – and we’re not a biller material, this is a business sale – and we need to ask if there’s someone else to try to convince inside the organisation about reducing energy spend and making decisions on whether it’s in the cloud, assisting in that decision.
Because that discovery, we call it discovery, but pre-planning, actually understanding what you’ve got and making plans around it – I have not met one customer who knows what they’ve got. When you go in there and paint it out for them, so they can make decisions, then you’re in a different league with that customer and your engagement tends to be a lot longer, and you’re under a less competitive threat.
We do say that the decision, you talk about 50 percent, and we say your decision on your server and the infrastructure you’re running is only a third of the decision you have to make, because that decision will actually drive two thirds extra cost. Whether it be the complexity of managing your environment or the energy it consumes, you’ve got to be aware of all those, and you just can’t make decisions in isolation.
Marcus If you want to create a new business or you wanted to change a business within the data centre space or within the reseller space, I think there’s probably two areas that I would focus on. One would be to create intellectual property around what you do and talking on the subject of power management and analytics, it’s a great respect to the vendor’s slant here which is selling more power management devices.
What you actually want to be able to do is to compare yourself to other people. If you look at how financial reporting is done in public companies, it’s all done the same way, so you can do comparisons. If you want to go and set up a new business, set up business doing analytics around how efficient you are to the number of users, the number of processors etc, and now you’ve actually got a benchmark.
That’s a huge opportunity in itself to be the adviser. To put yourself in that role, you need to collect and create intellectual property and you need to create a benchmark.
Look at SIA Global, look at all the companies which are services based and provide IP around something that’s different, the audit trail, once you’ve got that raw data and those metrics, you can say ‘okay what’s your current state?’ People are going through this journey of ‘do I insource, do I outsource, do I go to cloud, do I do co-location?’ – unless you’ve got the base metrics of your current state, you’re pissing in the wind, because you’re going to make decisions around an uninformed starting point.
If you don’t speak to the CEO and the CFO of the business and say ‘what are you planning for the business, is it steady state, is it merger and acquisition, is it growth?’ and understand where the business is going, the IT leader is going to always be on the backfoot, because six months down the line, they think ‘oh we’re going to buy our competitor, we’re going to double the amount of computer resource and users we’ve got, and yes we’re going to get operation efficiency as we merge the businesses, but that will be three years before we see that benefit’ – suddenly the consumer is going to be kicked in the side of the head.
You can turn it around the other way and use IT as an advantage and say ‘we compared ourselves to our peers, we’re 20 percent more efficient on our power, and 40 percent more efficient on our processors, than the competitor, we can actually drive $100 million of saving when you buy that business’.
The CFO would never even have considered that as part of his metrics of the decision making of buying a competitor or merging. If you look at some of the decisions, especially overseas, there have been a couple of acquisitions which have been completely IT-led, because they’re a pure services and transaction house. They’re a processing organisation. resources.
So capturing the day-to-day is part of the journey, that current state.
Andrew That relies on a certain level of operational maturity within the data centre, and a good majority of the data centres we see are at what I call an immature level of management – they’re doing reactive monitoring, collecting data and they’re producing some reports – but they’re not really driving a maturity growth that’s going to return a much higher level of value back to the business.
So there’s a journey resellers could help clients go on, which is about ‘how do I improve the maturity of what I’m doing about the way I manage the data centre?’ And it’s everything, not just software, tools and technology, it’s about the people, what competencies and skill sets within the data centre, within the organisation, and by extension within the partner organisation that I’m about to transfer my IT computing over to and use their data centre.
CRN How big would you say the skills and education challenge is? Is there sufficient awareness within the end seller community and end user business community?
Andrew All of the above. There’s a gap and I think because you’ve got traditional facilities management skills and capabilities and experience, and you’ve got IT skills happening with that experience and they’re coming together, so you’re going to see a merging of operational roles around the data centre. Also data centre operators and managers need to have much more visibility of what’s happening, around the business side of it, and by extension their customers as well. So you’ve got to look two levels out from your data centre and say ‘what are my customers demanding of my business, my core services?’ and ‘how can I support that business growth?’ So there is a gap.
Marcus We need to create the fuel standard. Instead of X litres per 100kms as a fuel economy benchmark, it should be the cost per transaction. So if you’re in a bank and finance environment and you’re running an EFTPOS network, you should be able to sit there and go ‘my EFTPOS network cost me 0.002 cents and my computers use 0.003. I am 33 percent more efficient in my data centre transactional processes’. To sit there and say ‘I’m doing 1.2 megawatts and he’s doing 1.4’ is useless, because unless you measure it against something else, which is the cost per transaction or the cost per employee, it’s meaningless. You need to be able to have that baseline. As vendor you need to start working with the channel to drive a common set of metrics.
CRN Meaningless in your context?
Greg Yes, we’ve got to create a repeatable, measurable and sustainable way of measuring the efficiency in this context, which is basically providing the infrastructure. Everyone’s got these acronyms, like infrastructure as a service. We’re talking physical infrastructure, network, power, cooling, cabling and the pathways, in a way you can measure against other people, but also bring some value back. We talk about the merger of facilities – I have a different opinion, I think IT is going to become accountable for the power usage and it won’t be facility managers.
The merger of facilities and IT management will be in the outsourcers, the Fujitsus, the HPs, the CDCs, where you have to be a facility manager and an IT manager and it’s operational excellence. In the average business, they’ve either outsourced it, or they’re too small to outsource and they’re saying, ‘I’ve got an operational problem here, it’s in the too-hard basket, I’ll flick it on to Amazon, I’ll flick it on to the cloud’. Again, it’s meaningless. How do you measure that?
You said about 30,000 comms room and servers – there’s probably around 2000 we need to address, and we need to baseline them against each other and start bringing in some intellectual property rather than just being the reseller of a partner. Because that’s what you go on Google for, you can order your APC switch, or your Cisco switch, and you will be beaten by an online person, because they’ve got no overheads and they’ve got no sales costs. So what you need to be able to do is to create something that you can’t buy online –knowledge.
Trevor On the gap between where the market is and the capability of the resellers, there definitely is a gap because no customers are looking for what you’re talking about at the moment.
I don’t think there’s an enormous gap in terms of salesmanship, you just need to deal with a couple of different customers inside organisations that you haven’t dealt with and bridge your gap and build your knowledge so you can articulate a message to a different group of clients. Rely on people like DPSA or APC to support you in a sales endeavour. Just ask the question and then learn from those people.
A lot of resellers don’t actually feel they can ask for help to improve the way they sell and engage, whereas I think the smart resellers who want to build a consulting practice behind what they do ask from those that have the IP and absorb that and rearticulate it into a value proposition that’s unique for them and reinvent themselves definitely.
Even if someone has gone and selectively outsourced and got into a co-location – there’s still an opportunity to sell the monitoring of that environment and reporting back because as soon as it’s in someone else’s hands, it doesn’t absolve you from the responsibility and your governance requirement, to actually make sure they’re doing what they say they will do and monitoring the power that’s being consumed.
The ones that we’ve started looking at, they’re at least being charged 25 or 30 percent more in the power than what they’re actually consuming, once you get down to PDU.
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