2022 will be the year of automation and innovation for the channel
Written by Peter Olive, CEO, Vortex 6
The uncertainty we all predicted 12 months ago has been a theme of 2021. Just when we thought we were coming out of the pandemic a new variant emerges, with governments around the world imposing more restrictions on travel and applying preventative measures to keep us safe. But are we in a better or worse place than this time a year ago?
We have rolled out the vaccine and have become used to a new way of working, so in my view we are in a far better place.
Many of the issues I highlighted this time last year are still relevant. We have made progress in many areas but there is still a lot more that needs to be done.
How will these market drivers impact the channel in 2022? Here are my top 6 predictions for 2022 and where we need to focus our efforts.
- Automation and innovation driving flexible and agile working
The need to find efficiency gains will never go away and will accelerate during 2022 as digitisation continues to drive change in our lives and business. According to Jay McBain of Forrester Research, this is the largest growth opportunity in 2022.
The challenge for partners will be identifying the best way of helping their customers to achieve these efficiencies. This will become more important than ever as organisations look to reduce costs while not degrading the customer experience. We are likely to see further rapid growth in this area. Much of this will come from new niche vendors addressing specific technology and business process challenges.
- Significant changes to vendor partner programmes
Many vendors’ partner programmes are likely to change in 2022, driven by the need to be more relevant to IoT, AI, software and security. The traditional tiered model that vendors have worked with for many years does not address the need for their channel partners to be at the forefront of these new technologies and methodologies.
The channel will need to be ready to adapt their strategy and workforce as the changes come into effect over the next 18 months.
- The ongoing impact of the skills shortage
The good news is that the IT industry is doing well, but there are challenges around skills.
Demand for skilled employees in new technologies is growing rapidly and three quarters of technology companies are experiencing issues in hiring appropriately skilled staff.
This is driving increases in salaries as new start-ups, new vendors and digitisation are driving demand. In my business we are seeing technology suppliers increasing their charges for 2022 by as much as 16%. The dilemma we will all face next year is passing these costs on to customers who are naturally reluctant to accept increases.
- New niche and focussed vendors
As we all look to innovate there are more niche vendors entering the market to address some of the gaps that the big vendors have in their portfolio.
According to CRN, there are 126 start-up companies founded since 2015 with annual sales of less than $1 billion who are engaged with channel partners in North America. This is almost certain to be an emerging factor for the UK channel. Partners will have to understand which of these solutions they are going to work with and then how to upskill your workforce to take advantage of the opportunity.
Increasingly, partners will need to understand what skills their employees have, many of which they may not know about. But more importantly they need to determine how increasing the skill set of their employees can help drive the adoption of new solutions to offer clients.
It will also involve looking at ways to get employees to develop their skills through self-guided learning – without incurring significant costs to the organisation. This will likely involve new remuneration plans that incentivise employees for increasing their knowledge on technologies that are important to their employer.
- Supply chain disruptions causing chip shortages
The chip shortage is affecting many aspects of technology from new cars to TVs to IT. The time needed to bring production back up to the levels required may take us to the second half of 2022.
The causes of the shortage included the increased demand driven by home working during the pandemic, the semiconductor factory fire in Japan, increased logistics costs and stockpiling by organisations.
Revenues are likely to be suppressed and the channel will need to work closer with suppliers and vendors to minimise the disruption. One way to lessen the impact that hardware shortage has on income is to accelerate the move to services and software.
- Expect sustainability to be a requirement
The UN COP26 Summit held in the UK during the first two weeks of November has certainly brought climate change issues under the spotlight. The increased concern about the environment is refocussing us all on how to reduce the negative impacts our businesses have on the planet. Businesses must be seen to be taking positive action and customers are going to be adding more requirements on suppliers to have sustainability plans and targets.
Any organisation that hasn’t already planned for this may find themselves becoming uncompetitive when bidding.
In the article I wrote last year, I predicted that uncertainty would be the normality in 2021. We have come a long way in 12 months, and we have become adept at transforming our businesses to be able to deal with the changes. Monumental change such as we have seen forces innovation and the need for us to continue to automate and think creatively will become the new way of doing business in 2022 and beyond.
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