Agents Ponder the Future of the Technology Adviser Model

… the technology solutions brokers and end user IT sourcing companies.

Because of the influx of changing buyer dynamics and value able data, private equity is heavily investing in this space. And it’s just the start of capital coming into the space via very successful private equity companies.

DN: Most agents took financial risks to fund their entrance into the agent world, and over time, have developed a healthy book of business that enables them to maintain a specific lifestyle. Many agents aren’t prepared for the new level of competition brought about by investors that will transform our industry. These new players understand that customer buying preferences are changing and are creating value-added services that will allow them to position themselves to be a one-stop shop for any and all technology needs.

It is becoming more apparent that many of the competitors who are backed by investment money will be able to bring new software and services to the marketplace faster and more efficiently than agents who don’t have the capital. With the convergence of telecommunications and IT, it’s now more than ever it’s important to assess your strategic relationships and make sure that you are in alignment and that your partners have the same goals and strategies that you do. Ultimately those who maintain their knowledge and skillsets, leverage their relationships and make sure that they are in alignment with their client’s goals will continue to thrive in our industry.

MS: Historically, successful agents have built their businesses upon developing trusted relationships with their clients. However, as more and more knowledge, expertise and value are required of an agent to succeed, it will be challenging to compete with organizations that can provide additional value-added services. Those organizations that can help manage the client’s entire technology life cycle while continuing to focus on the client success and trust will make it much more difficult for the smaller agent as time goes on. There will always be room for smaller agents, but it will become tougher for small agents to compete with those larger agents that provide a great client experience plus value-added technical and business acumen.

CF: Is there anything else you’d like to add?

MS: The opportunity for agents continues to grow and is bigger than ever. Pure brokerages are going to find it more and more difficult to succeed. Agents will be required to provide more value-added services, resources and technical knowledge. While there is still a great opportunity, the industry is maturing and demanding more from agents and partners. It is expected that VARs and systems integrators obtain certifications allowing them to sell services on behalf of a vendor. I could see a time soon when agents have technical certifications and leverage technical expertise as a competitive differentiation vs. focus on selling carrier products, especially as agents try to sell to the larger enterprise.

RJ: The result of the research and work I’ve done with private equity firms is that an agent’s book of business and data have optimal near-term value.