The CSP Direct model is like an iceberg
At QBS group we believe that our partners deserve the best. The best support, the best software and the best stories. This time we have asked one of our UK partners, Creative Business Systems (Cbiz), to share their thoughts and experiences with you on their journey to the cloud. We asked Amit Wason if he could share his experience with you on the matter of a direct or indirect approach.
The market request for a subscription based approach is growing
We noticed that the market is changing, our clients are, more and more, requesting a subscription based approach. This allows them to not have their own services nor the hassle. At Cbiz we have always liked doing new things both in as well as with NAV, where we focus more on a service oriented delivery and not a product delivery. For now we are working on creating our own apps that will work on Dynamics 365, thus allowing us to have less on-offs and go the more repeatable side of the business. We will engage with our customers to see what is really important to them and fill the gaps with our apps to make sure the standardised Dynamics 365 offering is a perfect fit for them. By working with QBS group we can get rid of the technical challenge and focus on the solutions.
Find your market; do some proper market research to see where the vertical is that you should go for. Do not just dive in; the potential market for Dynamics 365 is different than the traditional market.
Direct or indirect approach, that’s the question
There are 2 options when going to the cloud. Some 4-5 years ago we had set up another company that would focus on 2 things: cloud (internet) security and cloud based services. We tried to offer the works: provisioning, creation of new users and portals, automated invoices etc. In the end it was just a mammoth task and towards the end we managed to make it all work, although we were not there where we wanted to be. The competition of large players however is fierce, the investments are huge and all the other things you need to think about were just crazy; support, security. Unless you can really go to market with some serious numbers, it does not make sense to go direct.
We have gone through the pain and realized how hard it is to create your own direct model. So when Andy De Rosa of QBS group, he and I go back for some 10 years, mentioned we could use QBS group for all this we were most definitely interested. And I can only say when looking at the indirect model, such as offered by QBS group, it is just brilliant. My advice to others…don’t take the direct approach, it is like an iceberg; you only see a small portion, the majority of the work takes place under water. QBS group and his CSP offering has the best margin. If you would go direct all the margin would be eroded with all the hassle you have to keep it working. Setting up the hardware part is actually the easy part, the hard part is trying to service it. QBS group has done all the hard work and they give us one place with all the information we need. Adding additional services is a matter of seconds.
In the process we of course encountered many questions, such as security, who is hosting what, who does what. Getting clients to understand what goes where. Security has been the biggest hurdle, especially more corporate companies want to know all the details and do the technical governance themselves. It would have been good to have a pack with the answers to these questions, explaining this is what you are buying and this is what happens. We collaborated with QBS group in providing the right answers to our clients in these projects.
Results so far
We have been using QBS group for our services for 2 years now, and we have several customers live on the platform. With QBS group we have found a partner in the process and not just a supplier of the platform. When dealing with Microsoft directly you are on your own to make things happen. We also have our own portal on Azure but do realize it is a lot more difficult and more work if something is not working. Whereas with QBS group you just switch your server on. It just makes it easy to get it working.
As well as the costing is a lot easier; we do not have to worry about how much database was used that month, how many connections, etc. We have more confidence as with QBS group we get a fixed price for our infrastructure costs, user bandwidth costs so that we know exactly how much our cost price is and what we can pass on as resale costs to our customers.
Our plans for the future
We will be offering half our services on the cloud and thus repeatable and half of it still on a project basis. The mass of our customers will work in a more slick way. We expect some of our smaller clients to outgrow Dynamics 365 and move towards projects. We might even need to set up a separate company for the cloud business, with their own marketing and sales. I expect we will have doubled the manpower by then, whereas there will be a shift in people we will attract. We will focus on creating apps that will assist our clients in getting the most out of their ERP software. In the short term we will need to get ready for NAV 365, as we are the first country in Europe to launch. These are exciting times!
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