The Technology Risk for Today’s IT Customer

August 20, 2018

The use of technology today is ubiquitous. And all technology must be periodically maintained, upgraded, or replaced. This inevitably requires engaging an IT Reseller, which in turn exposes the Customer to risk.

Technology risk for today’s IT Services Customer

 
risk for B2B IT customer female executive

This technology (and financial) risk for today’s IT Customer is substantial, particularly in an era of digital transformation. IDC research has found IT project failure rates as high as a 70%, with vendor sourcing a significant contributor. All too often, the Customer commits large sums upfront, and with no real guarantee of achieving any return on investment, much less an acceptable one. How does this happen?

  • The biases of online search: Online research is the common starting point for a Customer seeking to identify a suitable technology provider. But this only identifies IT Resellers with massive marketing budgets, since the cost of online advertising is prohibitive for the vast majority of Resellers. In the US for example, intercepting any of the 40,000 monthly Google searches for “Microsoft Azure” would today cost a Reseller over $8 per click according to SEMrush. Surfacing for “Dynamics NAV” would cost over $55 per click. As a means of customer acquisition, these costs are well beyond the reach of almost every Reseller budget, leaving the most suitable resources for a Customer often too deeply buried in search engine results to readily locate online. Only find the very biggest Resellers will surface instead.
  • Professional networks can be ineffective: Whether they possess the capabilities a Customer really needs or not. Customers can also tap professional networks to identify Resellers, but that typically casts too narrow a net and often leaves the best potential resources undiscovered.
  • Sales teams: In the end, the Customer’s selection process most often defaults to a lengthy and expensive “beauty contest” of potential IT Resellers. But salespeople are hardly reliable sources of information as to Reseller capabilities, pursuing economic interests of their own. References from short-list candidates are unsurprisingly positive, and so provide little real guidance.

The result?

 

What follows is dissatisfaction, disappointment, and often outright failure due to the lack of a reliable, objective mechanism to assess potential Resellers. Recent Gartner estimates place annual worldwide IT services spending at nearly US$1 trillion in 2018. With a significant portion of that spent on IT services that ultimately fail to deliver concrete and valuable business outcomes according to IDC, it is a massive problem for all concerned.

This content originally appeared on CloudSpeed.

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