How is Cloud Computing Driving Channel Partners to Vertical Specialization?

 In Building Successful Partner Channels, Business Model Management, Industry News
Meet TBK Consult at WPC 2013

Meet TBK Consult at WPC 2013

Six Steps for building a vertical practice

More than ever, ERP and CRM applications are being hosted in the cloud at ever decreasing cost of subscriptions and ever increasing ease of use. [slider title=”MSPs”] Managed Service Providers [/slider] and [slider title=”ISVs”] Independent Software Vendors [/slider] are collaborating to drive the cost and complexity out of the software subscription model with clever wizards that enable customers to configure their own hosted applications in a fraction of the time and cost of the traditional consultant-led implementations. So, when the technology becomes a utility, partners must adapt to a higher value services model that is vertically specialized in enabling that technology to realize desired business outcomes.

By working directly with business owners/managers to advise them on the best practices in addressing their specific business challenges with technology, partners can become a part of customers’ planning teams and transition away from transaction based relationships to value based ones.

Microsoft’s research (Source: WPC2011 Session DYN11) reveals that Dynamics partners who have aligned their businesses by vertical specialization have seen a 32% increase in win rate and a 20% increase in deal size.

So how do you build a vertical practice?

Consider these steps:


Assess your current customer base and identify the verticals your organization has already been successful selling in to. This will give you an understanding of where your organization already has expertise. It also provides you with potential references for future sales as well as customers to revisit with a new solution.


Analyze your target verticals and establish if they are growing; if so, in which areas and from what market trends. The market trends will indicate where the demand is going to be so that you can plan on tailoring a solution. Establish which business challenges you are going to solve.


Once you have developed your ideal customer profile, research how many customers there are in your addressable geography. Make assumptions about how many are in market every year and how many you are likely to win. This will give you the basis to estimate the necessary investment and ROI.

Cloud Computing driving partner specialisation

Cloud Computing driving partner specialisation


Knowing who your target customers are and the business challenges you plan to solve for them, look for an ISV with vertically specialized software that can most effectively solve those business problems. Establish that the ISV can give your organization meaningful differentiation and competitive advantage. Ensure that there is a compelling ROI for customers – preferably within 12 months. Develop the total solution model with the ISV software, complementary applications and services. Ensure that you have a scale of solution price points to capture small, medium and large customers.


Invest in the right people. Your sales people have to become consultants, therefore, they need to have a background in the customers’ verticals and they have to be thoroughly trained in the software solution that will drive your sales. Often the best sales people will be ones who have worked in that industry and have experiential knowledge accumulate over many years.


To establish your credibility with future customers, you will need references. The best source of references is your existing customer base. Therefore, focus initial sales activities with your new ISV solution to qualified existing customers.

Whether customers procure their ERP or CRM software on-premise or in the cloud, your vertical expertise, accumulated from many projects over time, will become your source of new professional services revenue and potentially your company’s intellectual property.

Call to action:

If you would like to discuss how to make this work in your company, meet me, Paul Solski, and my colleague Steen Helmer at WPC. Contact: or linkedin/in/steenhelmer/ or via WPCconnect.

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