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IT Market Reality 2016: Innovations and Transformations

IT Market Reality 2016: Innovations and Transformations

As newer trends, opportunities, technologies, and roadblocks await the industry in the new year, it is significant to know how the partner community sketches their future going ahead. Through the ChannelWorld State of the Market 2016 survey, channel partners told us why they are excited about 2016.

By Sejuti Das
Analysis Jan 28th 2016

The seventh edition of the most anticipated ChannelWorld State of the Market (SOTM) survey 2016 revealed that as much as 56 percent of channel partners believe that the CIO role has gotten stronger in the past year, with 28 percent of respondents saying that it has remained just about the same. The respondents believe that the role of an IT decision makers or CIOs has gotten tougher and more important, as they juggle innovation and operational excellence, plus planning for a new journey of a digital enterprise.

Along with that, 35 percent of channel respondents viewed information technology as a valued service provider, while 31 percent viewed it as a trusted business partner. At the other end of the spectrum are IT shops viewed as competitive differentiator (21 percent) and as cost centers (12 percent), which are defined as IT functions where the enterprise value of IT is unappreciated, misunderstood or unfulfilled.

Enterprise solution providers are moving to newer business models in a fast changing environment and with pressure on margins. As a trusted partner and a value added service provider to CIOs and IT managers, enterprise channels at a larger view, expect the government to be the biggest spender on IT for the year ahead. Even though it is not surprising that 41 percent of partners feel that the government sector will increase its IT spend in 2016, what is shocking is that, the survey showed that only 8 percent of respondents expect a significant IT investments in the booming e-commerce industry.

Owing to these new trends, investments in IT and associated ensuing go-to-market strategies will take a new turn. While 39 percent of respondents stated that offering more services on a recurring revenue model, 15 percent say that introducing newer technologies will bring in enhanced business productivity. Enterprises in 2016, will now be mandated to align their objectives, offerings, technologies, strategies, and plans, in keeping with this shift.

The SOTM survey 2016 also revealed that the partner ecosystem expects better margins (43 percent) from their OEMs for the year ahead, with 14 percent expecting an improved implementation of newer technologies such as, hybrid cloud, machine learning, SDx, platform as a service, open source software, etcetera, and a proper technical support. Following that, 9 nine percent believe generating sales leads and moving towards OPEX based model to be their go to market strategy.

Also, with the advent of the above mentioned newer technologies, comes a different set of challenges and roadblocks. The survey findings further points out that partners will definitely turn to vendors to help them address these challenges. As much as 44 percent of partners—more than one-third of respondents—feel that in 2016, there will be a pressure on margins and that they will need more sales leads. Retaining talent will also remain an issue, followed by growing revenues and expanding customer base.

In a nutshell, the year ahead, 2016, is likely to witness several major shifts, business transformations, innovations, and, hopefully, more growth and opportunities for the partner ecosystem.