Like any partnership, trust between the two parties involved is key. The government sector is no different, except, of course, for the nuances that make the government market the complex machine it is. And, of course, GovernmentVAR's first annual GovernmentVAR award winners exemplify what it means to be a good partner and offer up advice on how they got to where they are today. The relationship between vendors and solution providers that sell into the public sector--and the partner programs that define them--involve a unique set of expectations.
"In a commercial organization, you can work with the CIO, develop that relationship and get the deal," says Larry Letow , COO of Bowie, Md.-based Convergence Technology Consulting. "The government is really not like that. You need to find out who the program manager is, the contract officer, the CIO, all the way up. It's tougher for one person to foster that relationship."
Therefore, the government sale requires disclosure on both sides. Letow says one vendor in particular, Citrix Systems, which was awarded GovernmentVAR's 2005 Government Channel Program of the Year award, is doing just that. About three years ago, the vendor realized that the public sector made up one-third of its sales and needed a separate program to foster and grow. Citrix first developed a program for the federal channel, then followed up with dedicated state and local groups. As a result, Citrix says it saw its government-partner business grow by 63 percent in 2004.
That said, developing a government-sector partner program is trickier than demonstrating loyalty to a certain solution provider, or expecting loyalty in return; government customers expect choices.
"The critical element in developing a program is a solution that needs evangelizing to the government customer," says Tom Simmons, director of government systems at Citrix. "We want to reward those that make an investment in our technology, but we also have to meet the requirements that government places on fair and open competition. That's a challenging balance."
To maintain balance, vendor and solution provider alike must weigh in market savvy and technical prowess. If a vendor isn't astute in its compliance with Trade Agreement Act (TAA) regulations, for example, the solution provider can unknowingly sell a product manufactured in China and be left holding the bag--and facing a lengthy and expensive audit. And if the solution provider doesn't know how to navigate a GSA contract, the manufacturer could lose the deal.
Symantec, for example, touts great experience in the public sector, but looks to partners to supplement that experience, as well as to establish relationships.
"We look to our partners to offer a lot of those necessary skills to sell into the market," says Alex Hart, director of public sector channel sales at Symantec and recipient of GovernmentVAR's 2005 Government Channel Executive of the Year award. "It really boils down to making sure that we have partners that have made a commitment not only to Symantec, but also to government--and as a result know the industry's dynamics. In return, we can help the partner understand the sweet spots, depending on what their focuses are in the marketplace. It's about always having an open door--being available. For complaints or suggestions, there's always someone there to listen, whether it's me or someone from my channel team."
But market savvy alone won't necessarily earn a spot in a government partner program. Vendors are selective, and solution providers need to carefully distinguish what they bring to the table. "You have several different profiles of reseller partnerships out there," Simmons says. "You have some whose value is breadth of offering; others, a lower aggregated cost. We can benefit from those things, but our primary partnership objective is to have partners with a technical expertise to properly position Citrix in the sales process, and then manage that sales process all the way from procurement through fulfillment."
Just as vendors require partners to bring market expertise to the table, solution providers should expect resources at hand to put that expertise to good use. And that means more than product.
"We see a lot of manufacturers beat on our doors and want to do lunch," says Adam Robinson, CEO of Irvine, Calif.-based Govplace. "Well, the cost to have 15 of my sales reps sit in front of a product pitch is huge. I'm not interested. If we're going to pull you in, we need to understand how you strategically fit."
Solution providers need hard benefits. One key component of many partner programs, for example, involves deal registration; a solution provider brings a government opportunity to the vendor and gets credit whether it wins that opportunity or not. Symantec's Partner Opportunity Registration Program, for one, provides a cash rebate to partners who identify, develop and close incremental sales opportunities on qualifying products and services.
"If we win the deal we registered, we get an additional seven points above the negotiated margins," Robinson says--points essentially being the scale that determines profit. "If we lose the deal, and someone else wins it, we still get four points. The assumption is that if we did the work on the front end to identify and develop an opportunity, we're still getting paid even if someone else is bottom-feeding deals and offering a lower margin. That protects my investment." Furthermore, Symantec's rebate is based on list price--not discount. That's particularly relevant in the government, where a $100 product can easily sell for $60 after federal discounts.
Of course, in addition to a sweeping knowledge of the space, solution providers also need partner manufacturers available on contract vehicles--required for going after many government opportunities--either through their own or by leveraging someone else's. Citrix actually centralized the GSA Schedules under its operation. In the past, it gave them out to companies, which some felt created an unfair advantage. "We have a schedule, but only from a labor perspective," Letow says. "Then we team with Citrix to do the labor combined with the software or the service support contracts." Recently, the vendor launched its State and Local Government Expert Program, which enables qualified partners to sell its products and services off of existing state contracts, eliminating the need to negotiate additional contract vehicles. It's also deploying a new GSA agent program based on feedback received from government partners.
But beyond touting contract vehicles, manufacturers should take care in who they authorize to sell products. Any solution provider that wants to sell a product to government must get a letter of supply--essentially authorization from the vendor. "We bring that back to government and negotiate prices," Robinson says. "Another company can come in with another letter of supply, and renegotiate down to a lower price." If a manufacturer issues letters of supply haphazardly, the result stands to be a horde of people who don't necessarily know how to work the GSA Schedule and are simply unloading product. "Sure, they'll probably price the products wrong and not adhere to the standards, and they'll eventually get in trouble with GSA," Robinson says. "But in the interim, they lock up the space for everyone else."
Even with a long checklist of components, tailoring a ready-made partner program for perhaps the most fickle and demanding customer is nearly impossible. That combined with ever-changing rules and regulations means solution providers and vendors targeting the government space need to keep an open mind and not be afraid to shake things up every once in a while.
"It's tough for a company to change a program for one partner, but flexibility is the key," Letow says. "You don't want to jam the round peg into a square hole, but you do want to be able to say, 'Hey, in this instance, we do have a square hole for you--what can you do to make it work?'"
Autor: Jill R. Aitoro
Quelle: VARBusiness, 02.09.2005
