2. Delivering Value-Add Services to Secure Business in a Tough Economic Climate ‘Sam’ Samuel – Independent Industry Consultant Email: sam_samuel@btinternet.com

3. A Tough Economic Climate

4. Slide 3 Some Statistics IT Spend slowing down over last 4 years – Source - Datamonitor –Problem is not just the economic slowdown 2009 - IT spend expectations –IT budget 2009 unchanged from 2008 – 50% –IT budget to rise in 2009 – 37% –IT budget to fall in 2009 – 13% 

5. Slide 4 Some More Statistics Proportion of Enterprise IT budgets that are planned to rise significantly (by 6% or more): –2006 > 20% –2009 <10% Some Industries such as healthcare is bucking the trend –57% plan to expand IT –Baby Boom generation is getting older – more demand for health services 

6. Customer Responses to a Tough Economic Climate

7. Slide 6 Customer Responses – The Budget Budget Squeeze –Have budget but have to ask to be allowed to spend it –Survival mode - It worked OK yesterday – so why do we need it today Review OpEx –Consulting –Training –Don’t fill job vacancies Review CapEx –Re-evaluate Projects and Purchases Maintain but slow down long term projects Bias towards short term, lower risk projects –Push back technology refreshes Consultant Project Plan 

8. Slide 7 Customer Challenges Cutting costs –May be difficult as a lot of the ‘low hanging fruit’ saving have already been made Shifting priorities in Wider Business and the Data Centre –Resource availability –Technology –Time Frames –Acceptable Risk levels 

9. Slide 8 Customer Project Management Projects which address urgent problems will be priority for funding –Security –Disaster Recovery –Regulation and Compliance Challenge for the IT project team: –If corporate IT does not respond quickly enough rogue projects within business units may start up their own 

10. Slide 9 Customer Project Management Some long term discretionary projects may also be retained, if: –Save costs, generate income or both –They reflect a substantial shift in the corporate direction –Position the company as the recession ends –Deliver value rather than just minimise costs  Cost Saving  Corporate Shift  Future Gains  Value

11. Customer Options Try to use in-house resources instead of bought in resources –Skill sets limitations –Time out for training (and potential training budget costs –Keeping up with the speed of technological change Consultants –Budget –Availability of skill sets –Trust Outsource –Traditional Outsourcing –New Options Trusted Supplier –Established relationships –Greater partnership –Shared Risk 

12. Slide 11 Outsourcing Outsourcers will portray themselves as a solution to the economic environment New Options being evaluated Change may be accelerated by the economic downturn –SaaS –Cloud Computing 

13. Slide 12 Outsourcing Challenges Direct services are difficult to outsource at a distance –Manual Skills –Personal relationships Innovation is difficult over distance. Outsourcing can’t be implemented quickly –A new outsourcing proposal can take 6 to 12 months of researching –Not a short term fix in response to economic downturn 

14. Slide 13 Outsourcing Alternatives Reseller Alternatives: –Managed services Recurring revenue stream –Leasing Reduces short term costs – typically the first budget squeeze 

15. Slide 14 Reseller as a Trusted Supplier A Farmer not a Hunter Hunting –Hunting works well in times of abundance –Aggressive hunting can backfire in times of scarcity - customers look for trusted relationship Farming –Relationships, Planning, Persistence, Discipline –Creates ongoing revenue stream 

16. Trusted Supplier When times are tough customers will look to who are their best suppliers for ongoing business –Comfortable relationship –Dependable –Supportive –Long term survivability Customers typically change supplier because something has gone wrong –Not normally a capricious decision –Trusted advice is valued more highly more in difficult times –Knowing the customer’s business as well as your own –Shared risk approach 

17. Slide 16 Reseller as a Trusted Supplier Temptation is to: –Cut service levels and the ‘value add’ items May reduce customer confidence –Discount heavily to win business Erodes customer confidence – even if it wins short term business Looks like survival mode Price List Discounted 

18. Slide 17 Reseller as a Trusted Supplier Value Add can: –Keep customer interest and inspires confidence –Lock-in customers –Help when Cross-selling and Up-selling 

19. Slide 18 Professional Services as a Value Add What can a reseller offer? –Complement existing customer staff skills Build on existing relationships –Project Management Blend system provisioning with system support –Technical Support Solving complex technical problems as a trusted partner 

20. Slide 19 Professional Services as a Value Add What can a reseller offer? –Minimise administrative overheads for customer No staff management issues and high availability No staff overhead – time, taxes, HR No vacation Flexibility – there when needed 

21. Slide 20 Professional Services as a Value Add What can a reseller offer? –Trade-in Customers recover value on legacy equipment –Repairs Customers extend the life of their equipment –Waste Management Allows customers to ensure equipment is disposed of correctly, complying with WEEE directives and security policies 

22. Slide 21 Any Questions?