85 – Optimize for Success 2021 – Find and Embrace the Ecosystem Delighting Your Customer.

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For this episode of the Series, “Optimize for Success 2021”, it was great to welcome back Jay McBain, Principal Analyst – Channels, Partnerships & Ecosystems at Forrester. In this episode, we discuss the rapid changes in the channel, accelerated by the pandemic and advice for listeners – “Find and Embrace the Ecosystem Delighting Your Customer.”

I hope you enjoy and listen as Jay always has a unique and well-shaped view of the channel based on his engagement with vendors, organizations, and partners and his command of the numbers driving the channel is like no other.

In this episode, we pick up where we left off from our 2020 mid-year discussion and he shares his perspective and observations on trends he has seen in the channel in the last few months, the continued rapid transformation he is seeing, and where organizations need to focus to optimize success in 2021.

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This episode of the podcast is sponsored by Ultimate Partnerships. Ultimate Partnerships helps you get the most results from your partnerships. Get Partnerships Right – Optimize for Success – Deliver Results – Ultimate Partnerships.

Transcription By Otter.AI – Please Pardon Typos Below

Vince Menzione 0:30
Welcome, or Welcome back to The Ultimate Guide to Partnering. I’m Vince Menzione, your host and as we kick off the four year anniversary of this podcast and leap into 2021, I’m thankful to all of the amazing thought and business leaders who’ve come to this podcast to share principles, success strategies, and best practices that help technology organizations thrive during this age of change and transformation. As we kick off this new year, I’m excited to be joined for this special series by some of those industry thought leaders to help each of us better prepare for what we can do to optimize success in 2021. for this episode of the series, it was great to welcome back Jay McBain principal analyst channel’s partnerships and ecosystems at Forrester. Jay was an early guest when I revived this podcast this summer, and he shared his perspective on what he was seeing mid year, and so I found it very appropriate to have him back to help share his perspective on what he is seeing going into 2021 Jay always has a unique view based on his bird’s eye seat working with vendors, organizations and partners. His command of the numbers driving the channel is like no other. In this interview, he shares his perspective and observations and where organizations need to focus to optimize success in 2021. I hope you enjoy this interview as much as I enjoyed my time with Jay McBain. Jay, welcome back to the podcast.

Jay McBain 2:10
Thank you so much for having me.

Vince Menzione 2:12
I am really excited to have you back as a guest on Ultimate Guide to Partnering. You’re one of my very first new guests coming back to the podcast this summer. And I’m excited to have you back to discuss the state of the channel as we kick off this New Year 2021.

Jay McBain 2:28
Well, I guess I didn’t screw up if you’re asking me back up on the right foot. Yeah, I

Vince Menzione 2:32
believe we are we are and you know, we had a really interesting conversation about some of the predictions that you had made at the beginning of 2020. And certainly we were in the in the midst of a year like no other. But I’d like to kind of back up a little bit here. And for our listeners who maybe didn’t listen to that episode this summer. Could you share with us a little bit about yourself your role at Forrester and your background? Yeah,

Jay McBain 2:56
absolutely. I’ve been around the channel for 26 years, I’ve worked for big companies like IBM and Lenovo running channels. I’ve worked in the managed services space. I was a founder, co founder and CEO of a channel software company for seven years. And then for the last three years, I’ve been an industry analyst, you know, counting up things and looking at things and trying to consume as much as I can to make sense of everything that’s going on, you know, and for many you have become the eyes and ears of the channel. And certainly for me when I was sitting at a channel chief role, I look to you to get some perspective on what was happening.

Vince Menzione 3:34
Can you tell our listeners a little bit about your perspective on the last six months since we last spoke?

Jay McBain 3:40
Well, that’s interesting. I mean, we were talking about a lot of things back then, you know, we were talking about ecosystems, you know, which are 10 times larger than your transactional channels. You know, we were talking about this growth of marketplaces. We were talking about this trifurcation channel and how to run programs differently. We started to talk about subscription and consumption models. And, you know, one of the key things that came out of last year is actually Accenture research that said, 76% of CEOs today, in every industry in every geography 76% of them think their current business model will be unrecognizable in five years. And ecosystems are the number one reason why

Vince Menzione 4:19
that’s astounding.

Jay McBain 4:20
So you think about these business model changes. And right from the time we talked in July, about a week later, Chuck Robbins from Cisco came and said, because of COVID, Cisco would become 100% consumption subscription model. And then about two weeks after that, Michael Dell stood up and said the $93 billion Dell Technologies with all seven companies, VMware, EMC, would all become 100% subscription consumption model. Again, accelerate because of COVID. You know, a few weeks after that, IBM jettisoned its services organization, which you know, was built through Lou Gerstner in the 1990s and has 450,000 people in it. And now IBM, after this new coke splits off becomes 100%, subscription consumption based business with red hat and Watson and, and kind of this new, emerging tech future. So if you count up those four companies and HP has been on this journey for a while, came out and said that they’re going to actually be finished a year from now. So going into 2022, HP will be 100% subscription. So if I take those four companies and look backwards in the client server era, that made up about 80% of the client server error. And so this is just a phenomenal change that partners are going through and are going to go through as these changes are

Vince Menzione 5:46
made. You know, this has always been or since the inception of cloud and subscription, this has been a hard pivot for a lot of organizations, essentially, from a financial perspective, right? You had a book of business, predictable, and then moving to subscription was often hard, especially for public companies. Why do you think the pivot is happening so hard? Now? Does it have a lot to do with maybe a better understanding of, we’re living in a crisis time we’re living in a time like no other. And maybe the street is a little bit more accepting of the pivot?

Jay McBain 6:18
Yeah, it’s part of it. But we did a big piece of research late last year at Forrester, which we call the future of buying, and I’ll save you 1000 there, your, your audience 1000 pages of reading, the conclusion was the future of business buyer, the future buyer of technology will look a lot like a consumer, the way you buy a car will be the way you buy, you know, software, hardware and services in the future. So the consumerization of the buying journey, you know, we talked about that digital journey up front, we talked about getting to vendor selection without ever talking to a salesperson, all the things that you do personally, when you buy a car, for example, now become the same psychology behavior and journey you have in your professional life. And so the changes that are being brought, you know, given that and how consumers are going to consume and these 30 day renewals, the this idea of everything in your life becomes this, you know, Netflix model, your Shavers come every month, you know, just as a consumption. And you know, you pay a couple of dollars over to Dollar Shave Club, your groceries, your everything, one third of the US economy is now in this e commerce marketplace world, and soon to be a consumption model. And this is what’s changing everything in b2b, and b2c, and everything collapses together. And I think these big companies are realizing that and pushing the envelope. But for a partner, it’s a completely different financial model, you know, you remember back to the early days of office 365. And instead of, you know, selling a $300, packaged piece of solution with some maintenance and other things, now you’re selling something for $6. And I don’t care if you’re making 20 3040 50% of margin, you’re not going to pay the mortgage on six bucks. So the conversation completely switched back then. And for every company and all the SAS companies, the 175,000, SAS companies we have today and the emerging tech companies, you know, this conversation is a different one. So partners are starting to ask different questions. And this is a big change in the last six months, is what I call the multiplier effect. They’re asking vendors different questions. And it’s not about how much margin on the front end and what the volume rebates in the market development funds and the new customer bonuses and the stuff on the back end. All that doesn’t matter. Because the transaction now is the first 30 days with a customer. What they’re asking for is what is the economic value or the ecosystem value that you generate as a vendor, Salesforce will come and tell you it’s $4.65. You know, a few weeks ago, Google Cloud came out and said, there’s this $5.32 going up to $7.80. If you go to the Google and Google Microsoft space ti, which is a forester product, but you’ll see you know, every one of their divisions, and you’ll see as a partner, how much I can make doing the installation, implementation, integration, security, compliance, business continuity data, all the downstream work, and that becomes the financial equation is how much multiplier Can I make? How much amplification Can I make? If I work with a vendor and they sell $1? How can I go sell $2 for 75% margin? That’s the big change we’ve seen since July.

Vince Menzione 9:30
Yeah, and this is a this is not a new conversation. We started having this conversation at Microsoft with the channel very early on, I would say I remember conversations six or seven years ago, maybe even longer, and it was all about this, you’re going to make money differently. You’re not going to worry about transaction revenue, margins, rebates, you’re going to find ways to be on the front end with the client in terms of consulting services, and then the back end implementation, ongoing support and the like. And that that model is very rich, but organizations really need to pivot hard. Those partners need to pivot hard to their business model to support that.

Jay McBain 10:08
Yeah, absolutely. You know, I worked along with Microsoft for most of my career, you know, selling PCs, for example. And we work together as hard as possible to hide the total cost of ownership, because it was a really bad scenario during client server. And the old managed services industry was born out of the really bad financial equation for customers in client server, you know, topology. So what we did in our best marketing is we tried to avoid the conversation, all the, you know, focus was on the price of the product and the, you know, initial procurement of it, you know, the resale, and we tried to avoid ever having this conversation of, you know, what, what, what does the help desk and the install move at changes? And what are the long term effects of that type of environment? And now, it’s completely turned over with multi cloud hybrid cloud companies are bragging about it? No, why would Google Cloud come out and say it’s $5.32, to a customer, it’s, you know, if I’m looking at spending $100,000, with Google, I better have $532,000 in the bank to get it to work, really productive system. This is the conversation that we’re now having. And I think it’s good to have, and customers are a part of that. Because in many cases, this is another change in the last six months, you know, customers are very much becoming your partners, and your partners are very much becoming your customers, we’re living in an embedded world, a white label, the world where there are no skews anymore, there are no products as distribution with skew them up, we’re living in a layered world of technology, building blocks of where customers are now becoming tech companies themselves, and coming to market themselves, you know, to survive. Part of that 76% that I that I mentioned, going to ecosystem. The net result is every company in every industry is becoming a tech company. And every one of your customers, as a vendor is also becoming one of your partners. And that’s a part of your ecosystem.

Vince Menzione 12:06
And you mentioned the building blocks. And I just recently had Bob Moore on the podcast to talk about cross beam. But we were discussing the fact that Yeah, you’re buying best of breed, you’re stitching together these building blocks, if you will, for a whole solution, it’s pretty arrogant to think from a SAS software provider perspective that the customer is only buying my solution, right?

Jay McBain 12:27
Absolutely. And Bob’s a great example where you know, cross beam is solving a really large problem and ecosystems, this escrow model of sharing data is critical, because even your best partners, you go back a decade, two decades, even your best partners, were a little hesitant from sharing their sales data with a vendor because of the worry of it going director, something happening. And now you go to an ecosystem where the relationships are, you know, not as tight, and it’s more celestial things are moving around. There’s a big problem that, you know, no one’s going to share data, you know, because you’re not contractually and the NDA ‘s aren’t signed, perhaps to the level they need to be. And he presents a really good solution there. I introduced crossbeam, for example, into a new category, the tech stack last year, and I just threw everybody into this bubble I called ecosystem management. Well, one of the big ones is ecosystem management now has six categories. And when I start to look at these companies, because I’m looking at adding 25 more companies into ecosystem management, and there’s attribution companies, there’s account mapping companies like crossbeam, there’s ecosystem management companies almost like look like PRM companies like zift, and zinfi. And, and partner, and Salesforce, there are enablement, collaboration companies, there’s API technology integration companies, and then there’s ecosystem recruitment type companies. So you know, there’s six new categories that didn’t exist even even two months ago. So this is rapidly evolving. And when I do my 2021 tech stack, you know, there’s so much more known about ecosystems now, to align to those 76% of companies who need to deploy this technology to make their own company work. And to survive this second stage of the pendant,

Unknown Speaker 14:13
when you’re going to publish that report,

Jay McBain 14:15
just where it’s actually a ton of work, as you can imagine, you know, getting all the data behind because actually published the size of the industry as well. And last year, companies spent $93 million on ecosystem technology like cross beam, well, you know, this year, the numbers are going to be higher. And I have to look from a grassroots level what every single company in the category is doing, and then roll that up into a target addressable market size, and then roll that up into an opportunity size. So it’s not just putting logos on a page, it’s actually building out what that actual market is. And, you know, for Bob, who went and raised a whole whack of money, I work a lot with Wall Street to kind of figure out where the next decade is going, because they obviously want to get in early and They want to get behind companies like cross being who they think could sell the 76% of companies on the planet who in which will make them a billion dollar unicorn. Yep.

Vince Menzione 15:08
So Let’s peel back a little bit on this to on this consumerization piece like, what is the client journey going to look like now? Or what is it looking like now like buying a car, from a technology perspective, because I want to help our partner ecosystem better understand where they need to pivot?

Jay McBain 15:24
Absolutely. So if you look back, and I use buying a car on purpose, because most of us have done that, and if you could trace back to the last time you did it, it’s a big purchase. So you kind of you remember it, you remember when you set foot on that dealership, and how poor that experience was. But you know, the time you need a car, you know that that moment in time where your old one breaks down, or it doesn’t have that new car smell anymore. I mean, there’s a point in time where you turn psychologically to the point where you have a neat that every moment in time after that I’m obsessed over, you know, you go to a couple of magazines and you read, there’s 365 kinds of cars, one for every day of the year. Not sure if you knew that

Vince Menzione 16:03
I did not

Jay McBain 16:04
you quickly in your head have to start narrowing things down. You know, do I want a Jeep? Do I want an SUV? Do I want a sports car? Do I want electric I mean, you got to start like narrowing things down because you’re not going to go and you know, do a battle card with 365 different brands. Absolutely not, you’re gonna get it down into a zone where there’s a shortlist. And you’re going to be bouncing across YouTube and magazines and social media, you’re going to go ask your neighbor, your friends, you’re going to consume a ton of information. But the one thing that happens is when you step foot on that dealership, and you’ve got it either narrowed down to the one car you want, or you know very, very tight in terms of a shortlist. At that point, you know more about the car, you’ve already configured it, you’ve already priced it, you know more about the engine than that salesperson ever will. But they’re still stuck, you know, from decades ago, and they’ll sit you there for eight hours trying to get you a deal in air quotes from the manager and go back and forth and try to make you hungry. And you know, they do all this old school stuff, and you kind of roll your eyes and go, I already know what I’m paying for this car within $100 I know your invoice price, I know your back end rebates. I know, I kind of know what what’s going on here. And I probably pay $100 more if you just deliver it to my driveway and Kenny the keys kind of like the carvana approach. But for new cars, like just I don’t want to sit for eight hours and go through this mess, because I already know how it’s going to end up. So that’s the new style. So if I switch out cars for a second and switch in technology, buyers are doing the same thing. Each of these moments, they’re consuming information, they’re talking to neighbors and friends, they’re they’re going to peer groups, they’re going to social groups that they’re going to YouTube. I mean, they’re doing all the things digitally. They’re not talking to salespeople in a majority of cases, and they’re not filling out web forms with correct information. So what’s happening now is vendors are losing deals and partners are losing deals without ever knowing there was a deal, there is no lead registration or deal registration, because nobody’s picking it up. The fact of the matter is that customer now there’s about you know, 80% of them that prefer this digital journey. And a digital only journey, I think it’s 68% want a digital only journey. And now we’re over 50% of them that get to vendor selection after a digital only journey. So the days of mq ELLs and SQL and managing your CRM system, it’s going to be hidden from there, because that customer never left a breadcrumb that you’re going to recognize. And now with Apple and other companies, protecting your privacy, you’re tracking on the internet, and you know, being able to do this anonymously. You know, even all those marketing tools you may have had in the past that pick up these little signals are going to work less than they did in the past. So, you know, your job is to figure out this digital journey. And what we now know is that on average, that customer is going to use five different sources or five people or five companies, on average, to get from I have a problem to vendor selection. These influencers, these five virtual chairs around the table, is what vendors need to get obsessed over. And these five chairs are random at best, you know, could be a system integrator, there could be an MSP that earns one of those chairs. It could be an accountant, a digital agency, it could be a consultant, an aggregator a broker, it could be a definitely will be probably an ISV or two. It could be an emerging tech company. I mean, there’s every company in every industry is becoming a tech company. It could be anybody sitting in those five chairs that made the podcasts that did the E book that you know is participating in a peer group. However they’re interacting. They’re the influential ones that are going to get them from a problem to actually getting a set of keys. And that’s what if you get obsessed over that it changes everything. You’ve got to start shifting your program dollars to the left earlier in the journey. You’ve got to start doing attribution, which is a consumer term. You know when you hire Kim Kardashian to do an Instagram ad for a million dollars, you kind of want To know that it was worth the money, well, around these five people wrapped around that potential customer, you want to know who’s earning those five seats. And then you want to know who’s the most influential, early in the journey, because they’re not the ones that are going to actually do the transaction. So there’s no quantitative way of matching who is influential to who’s going to collect the money. So it’s a little bit of science, a little bit of art and science here in terms of connecting dots to all of those early permutations. But this is part of ecosystem technology now is getting better at predicting and participating and influencing the influencer early in that customer journey. Is everything now to winning the deal.

Vince Menzione 20:40
I love the analogy of the car. By the way, I purchased the Jeep about a year ago and had the same experience. I’m a Jeep guy. I’ve also been a BMW guy, but we’ll go there another time. But I do see this like, rather than hire what I’m getting from this conversation, rather than hire that fast talking SAS software salesperson, you need to invest in your channel ecosystems, including your influencer ecosystem. But then how do you then attribute back like I have all these influencers? Maybe the Kim Kardashian of the technology space, if you will? Yeah. How do I how do I, how do they make money? How do I attribute it back? Like are there systems and tools that support that process?

Jay McBain 21:20
Well, there is. So when I talk about that multiplier number, they are participating in that $4.65, or the $5.32, there’s a high likelihood that they’re charging the customer for their value in some way or another, they’re converting that ebook into membership, they’re converting, you know, maybe they do end up with the transaction, but probably not. But downstream, every 30 days forever, they could be they’re delivering services to drive adoption. Number one, they could be doing integration work, making it more sticky for you, which will earn more money, they could be doing upsell and cross sell to enrich that deal or that contract with a broader set of your portfolio, there’s a lot of things they can do inside that $5 multiplier, that may you may not be paying for directly, but they might be charging the customer for. But in the future, you are going to be paying for those behaviors. You know, I want to pay for somebody 123 of those people around the table to get the deal to be mine. And I’ll shift money for my sales and marketing to do that. And then long term every 30 days forever, the customer journey now never ends, the people that I can attribute that are driving better adoption, which means better retention or renewals for my product, better lifetime value, I’m going to ship program channel program dollars to the right and every 30 days, I’m going to be looking to spend money for those people that are doing those three things, adoption integrations and stickiness and then upsell process. That’s where I’m because the resale By the way, the whole transaction in a subscription world is the first 30 days with the customer. Yep. And you know, that’s important, you got to obviously get the transaction done. But it shares important now that’s the trifurcation model, it is equally important to get in early and often it is equally important to get the transaction. And now it’s equally important to get that 30 day retention renewal to get a customer for life. So where I spent $1 on a gold silver bronze program getting the deal, I’m going to now spend 33 cents, I’m going to ship 33 cents over to the left in the customer journey. And now I’m going to shift 33 cents over to the right. And so I’m going to spread my programs like peanut butter. And this was another big change that we saw since July, major companies and I could probably list off a dozen of them like Oracle’s and sa P’s and IBM’s that now have this language around build, sell and service. By the way, that’s much easier to understand than trifurcation Let it be known that that’s their attempt at spreading their program dollars like peanut butter to understand the importance of technology integrations on the build side, the service side and and how they’re going to start shifting money away from volume rebates into renewals. And so as a partner, you’ve got to pick that up quickly. And understand in your own financial model, how you collect these dollars and collect more dollars programmatically than you did in the past. And at the same time, start to get obsessed on that multiplier where I can go make $2 for every $1 my vendor makes, as long as I have the right sales and marketing and messaging, as long as I have the right engineering technical talent skills and resources and, and practices built to go do that. That’s the future of the channel right there.

Vince Menzione 24:39
So it’s building out your capabilities going deeper with your customers is that what I’m hearing,

Jay McBain 24:44
it’s building out your capabilities to the multiplier of the vendors that you work with. And I know that a customer that buys x is going to spend $5 more to get it to work, I need to participate in that $5 and I need to make sure that I have got, you know, very specific in terms of I’m in the right room at the right time delivering the right services and charging the customer the right amount of money to take advantage. So every $100,000 Google Cloud deal in my town, in my city, in my industry, wherever I focus, I should be looking and I should be all over that deal, trying to go win $200,000 of my own at 75% margin. If your company’s not thinking that way, it’s going to be a struggle in a pure subscription consumption, ecosystem type of world where we’re going to in the next three to five years.

Vince Menzione 25:34
Yeah, so that’s really good advice. In fact, we’ve, you know, I’ve had Tony Savoy and the CEO of sada systems on this podcast, I’ve been on his podcast as well. And I think it I’m looking at and going, Okay, that was easy, because when you’re early on with the hyper scalar, or the large partner, the vendor, it’s probably easier to do it. What about the organizations that have an old model? Like, how do you help them hit it hard? In 2021?

Jay McBain 26:01
I think it’s, it might be a pivot light, you know, I never subscribed to the magazine front cover, you know, you’re going out of business, nobody’s going out of business. Well, given COVID, there are, but what three and a half trillion dollars in this marketplace in the global technology industry, and 64% of it delivered through the channel. Nothing changes overnight. And I think it was Bill Gates, who said that, you know, we overestimate what’s going to happen in two years. And we underestimate what’s going to happen in 10. Yep. So in the next two years, you’re not going out of business, you’re, you’re, you know, you’re not going to face significant headwinds. But if you don’t start to make these changes, you’ll look back in 10 years and go, I should have saw this coming. I mean, it’s just so obvious that, you know, this is where we’re going to end up. So I always say that, you know, you’ve got to start layering this in this is not a pivot, this is not a transformation, like a going out of business transformation. But if you’re not thinking about this, and getting obsessed about the right things at the right time, this early customer journey, this cut this vendor multiplier, you know, if you’re not watching these things, right now, I don’t know anyone who would have a strong debate or argument otherwise, that somehow we’re going to flip back into a strong resale model, we’re going to flip back to where we were in the 80s and 90s. I don’t think anybody who knows anybody who is thinking about that right now.

Vince Menzione 27:21
So we’ve talked about this transformation happening fast these last several months, right? We’ve talked about the acceleration Sati is use the term, you know, equivalent of a year in a month type of scenario or analogy. What do you see now? Is the acceleration still continuing at the same pace? Or is it slowing down?

Jay McBain 27:40
No, I think it’s going faster, faster when I started rhyming off all these announcements, you know, not only in our political world and social unrest, and with a pandemic, I mean, we wake up every morning, you know, like Captain Jean Luc Picard. And, you know, we asked her a damage report. And, you know, with early January, you know, in US politics, for example, we wake up in the morning asking for damage report. So in our industry, we do the same thing. You know, there are major announcements, there are major, you know, things that are happening almost on a daily basis, as you’re scanning the 54 magazines out in our industry, that report on this stuff. I’m subscribed to all 54 around the world. So in India and Australia, I get the news faster than I get it in, you know, the US when I wake up. But the fact of the matter is, you know, we are in a constant state of shift here, there is a lot of moving parts. And an ecosystem, it’s celestial, we’re moving out of this linear model that, you know, somewhat predictable supply chain, like, you know, left and right, it’s less to model, everything is moving in its own direction, and you don’t control it, you know, you may be a big sun, like a Microsoft maybe, or an AWS or a Google. But you’re just, you know, in a galaxy part of a larger universe of things happening. So as a company, whether you’re a partner, whether you’re a vendor, you just have to get really good at understanding predicting, when the stars and moons are going to align, and knowing what you’re going to do before they align and when they align in front of that customer. So, you know, you could always talk about change as being constant, you can always talk about things accelerating and things like that. But I go to some core tenants or temples, as, as you mentioned, and knowing some of these key parts of the future, you know, how am I going to participate and succeed in an ecosystem? How am I going to participate and succeed in, you know, subscription consumption model?

Unknown Speaker 29:31
You know,

Jay McBain 29:32
knowing in 2021 17% of the tech industry is going to go through marketplaces, whether as a vendor or a partner, how am I going to go succeed on the 20 top marketplaces in the tech industry, that drive 80% of the volume there, it’s not single digits anymore. That was a change because a COVID, you know, 17% makes it material and meaningful that if I’m not participating there, and that 17 is going to go to 27 and maybe 37 over the next you know, number of years. So you’ve got to figure out wherever you are in this solar system out. So let’s deal how you’re going to participate and win in these new environments. You’re not going to stop this from happening, you’re not going to shift it from happening. But you can definitely get in early and become one of those early winners get on page one of the marketplace, like you tried to get on page one of Google get, you know, inside that marketplace as they start adding partners to it, so that you’re an early winner, you’re an early person picking up good referrals and things like that. So you’re looking ahead at these changes. And, you know, getting on that early adopter early part of the, you know, baseball game,

Vince Menzione 30:39
so it’s going to ask you what some of the best partners are doing what some of the best organizations are doing it, what it sounds like here and I want I want you to validate this is I now have to be super committed to my partner ecosystem, I can’t have one foot in and one foot out. It’s almost as if I my Salesforce, so I must become secondary, because you’re talking about a lot of different That’s right, I’ve got 17 marketplaces, I’ve got partner ecosystems influencer ecosystems, I need to support maybe distribution as well. Like I’m covering a lot of bases, what do you see some of the best partners are best organizations do?

Jay McBain 31:14
Well, the best organizations we see. And I get to see about 10,000 of them. So I get to see it at scale, the good, the bad, the ugly, the best organizations, bar, none are the ones that hold the customer as the basis for everything they do. It’s the North Star of everything they do. And so if you look at your customer, and look at their preferences, you know, it could be a route to market preference, it could be a buying preference, it could be a journey, preference, whatever it is, that’s what guides you, by the way, if your customer in their industry, and their geography and their scenario are not buying through marketplaces, that’s what guides the fact of the matter is we think that they are going to be you know, doing that. So it’s something you need to start considering. But if you imagine for a second up on your wall, look at a heat map. And we know today that you know line of business buyers are more buying more technology today than it buyers. 65% of SAS, for example, is bought by line of business. So the head of marketing the head of sales, operations, finance, HR, there are partners that are dedicated to the buyer, like a digital agency is dedicated to the head of marketing, who in many companies spends more on tech than the CIO. Secondly, we know it’s not industries anymore. It’s sub industries. There’s 297 sub industries, it’s not about healthcare anymore. It’s about a midsize clinic with 50. Doctors, you know, different than a small dentist office different than a small hospital, you know, very specific to that southern district. We know geographically, if that midsize clinic is in upstate New York versus Toronto versus London versus Dubai, it’s very different legislation, regulation compliance. So partners are dug in at a geographic level as well. Number four, they’re dug in at a sector segment and size, you know, I made specific reference to 50 doctors, it changes as that goes up or down. So the size of customer SMB versus mid market versus enterprise brings in a whole different channel. And then products, you know, we used to look at hardware, software and services back in the day. Well, today, we have 26 categories with 200 sub categories. No, you can’t have a security conversation without going into the seven layers of security, and then the 17 layers below that. So when you multiply all five of those vectors together, there’s 35 million parts of your heat map. And even the biggest vendors don’t cover the entire heat map. So you’ve got to understand where you’re going as an organization, and where you’re going to hyper specialize and start to understand the ecosystem, it becomes at that point, the law of a few if you follow Malcolm Gladwell, you know, any one of those points of the heatmap. You know, if I’m going after midsize clinics in upstate New York, I could quickly within probably this afternoon, get you the top 100 people that are sitting on those associations that are in the magazines that are running and keynoting, the events that are recording this podcast, like who’s the Vince of upstate New York midsize clinics, I could get you that list of 100 people. And as an organization, whether I’m a partner or a vendor, I want to check off number one to those people know who I am. Can they pull me out of a police lineup? Number two, did they know enough to be dangerous? in a hotel lobby bar in, you know, part of their podcast? Would there be a place where they can differentiate what I do? And actually, you know, speak at least with a 32nd, elevator pitch, you know, kind of knowledge of what I do. And then most importantly, number three, would they endorse me they’re out there influencing, they’re probably going to earn one of those five spots around the table with every mid sized clinic. And if they don’t earn one of those five spots, they’re going to heavily influence the people that do so I’m going to influence the influencer. And if I can pick up you know, 20 or 30 of those top 100 people out there talking nice about me in front of customers and in front of the industry itself. I’m going to be all things to all people up in upstate New York in front of mid sized clinics. And again, this is a project that we ran over the course of an afternoon to model of what we need to do in all of 2021 against that mission.

Vince Menzione 35:01
So that’s, that’s quite a bit of material to cover their five sets of attributes. If there’s one thing I can do this coming year, this year 2021 differently or better, what should I do?

Jay McBain 35:14
If there’s one thing you know, as a partner, we used to always say, you know, look in the guestbook, you know, when you go and visit a client, you can’t do that anymore with a pandemic. But you can look at their virtual guest book, The fact of the matter is, every single company in every industry is becoming a tech company. So every accountant that signing into your customer, every digital agency, every consultant, everybody that’s coming in, is having probably a technology conversation, there’s over a 50% chance that they’re having a technology conversation, you don’t have to take over that conversation. But you have to recognize the ecosystem built around your customer. And to get access to that multiplier that I talked about, you get to know the people that sit around the table, and influence. That’s the one thing, it’s understanding, again, with your customer as the basis or Northstar of everything you do just understand what the layers of the onion above around your customer are. And make sure that you’re building relationships, that when the right time of that multiplier comes in, and they’re looking for that right implementation or integration scale or technology skill, that you’re going to be the one endorsed at that point, nobody’s going to own all $5. But you can get your fair share by knowing around your customer who that is. And for vendors is just an extension of that your partners that wrap around your customer from all different angles, and your ability to understand who influences the influence. influencers is going to be the one that when the

Vince Menzione 36:39
community model that goes in and executes at a different level of scale. I love that advice. That is such I will say perfect advice for our listeners coming into this new year. Thank you very much for that. Jay. I want to I want to shift a little bit here. We’re getting towards the end of our interview. But I do want to ask you, this has been an overwhelming year for so many of us. What are you doing in 2021? For your own I’ll call it mental health or mindfulness.

Jay McBain 37:08
Yeah, for for me personally, I’m a Canadian. So by law, we have to play hockey. I played a couple of times a week for my entire life, probably for 45 years now. And I had to give that up. My wife is high risk. She had heart surgery a couple years ago. So we’ve had to take this very, very seriously. And so that meant no more hockey and you know, kind of no more, you know, leaving the house in any kind of crowded environment. So I actually jumped on my bike, my road bike, you know, started logging some miles to stay in shape and things. And as I started doing it, I started getting consistent. And I started, you know, going on 50 mile rides, you know, every Sunday, and by the end of the year, I set myself a goal. And I used to live in Canada. So I set a goal to ride from Miami to Canada, Toronto, the equivalent mileage of which was like 11 149 miles. And so I worked at it every week. And then right around Christmas, I announced that I made it. So you know by doing this consistently and now in 2021. Again, I can’t go play hockey until we get the vaccine. So again, I’m still doing it. And now I’m moving into Winnipeg, which I worked with IBM for a little while in Winnipeg. I worked I grew up in Calgary, my parents are my mom and my sister in Vancouver. So I’m moving across the country and by the you know, one year anniversary of kind of the lockdown and stop playing hockey. I want to ride the 2500 miles to Vancouver and that’ll be kind of a personal goal of mine. Wow, that’s amazing. And we’re both in South Florida right

Vince Menzione 38:34
so I get to see your your posts about your I don’t ride as far as you do. I just do it more for leisure and a little bit of peloton in between, but there’s nothing I guess, by the way.

Jay McBain 38:45
So you know, everybody listen to podcasts differently. I have my Vince podcast queued up in my podcaster. And when I’m out on the bike for three hours, I get to rip through, you know, four or five podcasts. So it’s my area where you know, I can kind of let loose I listen to music for a while but then I you know, listen to Malcolm Gladwell for a while and listen to some industry podcasts for a while. It’s actually an area where I can decompress.

Vince Menzione 39:08
I do very much the same thing. I have my own audible books, I have the podcasts have a little bit of music. And I am so much in agreement with you that this is why I believe podcasts are so important to us now. Like we’re on that screen like 12 hours a day. I’m tired of looking at my monitor.

Jay McBain 39:22
Yeah, my eyes are tired of looking at my monitor.

Vince Menzione 39:25
Yeah. So I have one more question for you. And this you have been amazing today by the way, I just love having you on to talk to our listeners about all of these things around the ecosystem. Your your viewpoint is just incredible. But you are having a dinner party when you know when we can do this and be feeling that we’re safe doing this. And you can invite any three guests present or the past to attend this dinner party. Who would you invite and why? Oh, well,

Jay McBain 39:53
so I’m going to go with the past and I’m going to have a dead dinner party. I would invite john candy Chris Farley. Robin Williams. Wow, I think that would be the funniest dinner party. And you’d be in stitches in lying on the floor laughing the whole entire night.

Vince Menzione 40:10
That would be an amazing dinner party. You got a couple of Canadians in there, too. Right?

Jay McBain 40:14
Well, that’s the bylaw I

Vince Menzione 40:17
have never leads to, I’d love to be listening in on that dinner party for sure. Three amazing human beings. And that brought a lot of light to this world. And regretfully, they’re no longer here with us. Well, Jay, thank you so much. Any closing comments or advice for our listeners?

Jay McBain 40:35
No, I think it’s a, you know, we’ve got to take care of our families and our friends and our businesses, again, you know, with so many things happening in the world. And, you know, I don’t make light of social unrest, and the pandemonium that we have in different parts of the world, and, obviously, the pandemic into a very second and serious face. And, you know, everything else from murder Hornets and everything else that, you know, are around, you know, that this is a time that we’ll always remember, and this is the time that, you know, history books, you know, decades from now and even 100 years from now will be written about. So it’s all about family and friends and health and, you know, coming together, and that’s how we’re going to be measured is our impact on others, our business results and other things. You know, we’ll be interesting at the time. But, you know, at the end of time, we’re going to remember who had our back and and who made an impact. Amen. So

Vince Menzione 41:30
violent agreement with you on this same topic. Jay, thank you so much for joining the Ultimate Guide to partnering. All right, thank you.

Transcribed by https://otter.ai

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