The Microsoft Partner Network

The amount of discussion around the new MPN is increasing, and the information available to help explain it seems to have settled out, so I am going to take a little time to address the coming changes. There are a series of common questions and whines that seem to be consistent, so I'll share my take on what is to come from what I believe to be true.

The first question regards when the new MPN takes effect. October is the launch of the program broadly, although some aspects have been slowly intergrated into the current program over the last months. But October is the official date, so that is when things kick into gear. I have had lots of questions and confusion around why we continue to get the report cards monthly with points listed on them. These are informational and are important for companies whose renewals are happening prior to October. The information is valid under the current program, but will go away once we reach the October launch. No more points. Note: your renewal date will actually be the transition date from the old program to the new. Everyone does not make the switch on October 1, but as your renewal date comes you will be moved to MPN.

A very common discussion is around the gold level. The new gold in MPN is not equivalent to the current gold in the program today. My perspective is this, and my disclaimer is that this is my opinion only so take it for what it is worth. I think the current gold level becomes roughly equivalent to the silver certified level in the new program. Gold in the new MPN (formerly called advanced competencies) is a level that is not available today. But it is very much like becoming gold in the current program was some years back. It is designed to be a differentiator, and it is designed to be difficult, and it is designed to keep most partners from being at the new gold level. It is supposed to be hard to achieve. Just because you are gold today you SHOULD NOT expect to be gold at your next renewal. They are not equivalent levels. So many partners are voicing displeasure (whining in my vernacular) about the fact that they can't or at least are not planning to make the investment required to remain gold under the new program.

Here is the reality. If being gold in the new MPN is important to you - it really is not unattainable. It takes 4 engineers and some sales to achieve it. That allows you to be at the highest certification level that Microsoft offers a partner. I don't think that is too much to expect. Some will say "easy for you to say since you have so many employees". The hard truth and reality is that a company with less than 4 people cannot expect to be equal to a company with 75, nor can we at 75 expect to be equal to companies with hundreds or thousands of engineers. All IT companies are not equal. Microsoft has taken a good shot at making differentiation possible. I would never say that we have the same level of expertise that our larger competitors have. We are not as deep, don't have as many resources, etc etc. I know it is a hard pill to swallow but we at HTS will move from a half dozen competencies to one or two in this program. It is a reality that change is coming. And that is the design.

Change happens. It always has, and it always will. The speed of change continues to increase so that means we have a few choices to make:

• Resist it, fight it, refuse to participate
• Grumble about it, drag our feet, grudgingly move toward it
• Embrace it, support it, lead others through it

Which of those describes your approach to change? The train has left the station so I encourage you to embrace it and figure out where you will fit into the new MPN. There are some resources available to you:

You can create a customized transition plan to the Microsoft Partner Network by calling the Microsoft Partner Network Experts at 1-877-254-6825. You can work with an MPN Expert to develop a customized transition plan to help you understand your current partner status and identify what actions your organization will need to take to meet your membership goals under the Microsoft Partner Network:

• Your organization’s status toward achieving new silver or gold competencies based on the competencies you have currently achieved
  – Microsoft Certified Professionals (MCPs)
  – Exam requirements for those MCPs
  – Training and Assessments
• Licensing Assessment
• Sales & Marketing Assessment
• References
  
  If you prefer to work on it yourself, the new transition tool is now available. You can find it here. Eric Ligman wrote a great blog post to lead you through using it that can be found here. Lots of resources to begin the process. But the message is to get started now. It will require some tests to be passed and some planning to be done in most cases. Don't sit back and wait. Find out where you are today, and then you will know what your options are and what needs to be done to move to the place in MPN you desire to be.
  
  There is another piece of great news from Microsoft that you should be aware of. This week the US SBSC team has made $500 available to their partners. Microsoft Small Business Specialists (SBSCs) have access to rebate funds reserved exclusively for them! SBSCs are eligible to receive up to $500 back on marketing investments.

Funds are available for you to drive demand generation efforts through Ready-to-Go Marketing (includes Events, Campaigns, and various Marketing Services). We want to help you to grow your business.

Don't wait: These funds exclusive to SBSCs are valid until December 31, 2010 or until supplies last. More information is available here. To get your reimbursement, submit your invoice at www.mspartnerdirect.com/rebate. Your special promotional code is: 'SBSC500H1'.

Get started today. Spend the marketing money. Use the online tool. Call the toll free help line. Just start the process and work toward your goal. Planning makes this happen. Remember that vision without execution is hallucination. And if you don't think it is worth the effort - that is your choice - just remember who made it. Don't complain about Microsoft if you choose not to participate in the new MPN. That is something you will decide, not them!

Management or Leadership

This week there was a great post in Harvard Business Review by Robert Sutton entitled “True Leaders Are Also Managers”. This is an age old discussion – what the role is of a CEO vs. President or manager vs. leader. The article includes these comments:

“In my reviews of the writings and research, I kept bumping into an old and popular distinction that has always bugged me: leading versus managing. The brilliant and charming Warren Bennis has likely done more to popularize this distinction than anyone else. He wrote in "Learning to Lead: A Workbook on Becoming a Leader" that "There is a profound difference between management and leadership, and both are important. To manage means to bring about, to accomplish, to have charge of or responsibility for, to conduct. Leading is influencing, guiding in a direction, course, action, opinion. The distinction is crucial." And in one of his most famous lines, he added, "Managers are people who do things right and leaders are people who do the right thing."”

Sutton continues with these words: “Although this distinction is more or less correct, and is useful to a degree, it has unintended negative effects on how some leaders view and do their work. Some leaders now see their job as just coming up with big and vague ideas, and they treat implementing them, or even engaging in conversation and planning about the details of them, as mere "management" work.

Worse still, this distinction seems to be used as a reason for leaders to avoid the hard work of learning about the people that they lead, the technologies their companies use, and the customers they serve. "Big picture only" leaders often make decisions without considering the constraints that affect the cost and time required to implement them, and even when evidence begins mounting that it is impossible or unwise to implement their grand ideas, they often choose to push forward anyway.”

He is right on the money. There has to be balance between the two. Robert Sutton goes on to close with these words: “I am not rejecting the distinction between leadership and management, but I am saying that the best leaders do something that might properly be called a mix of leadership and management. At a minimum, they lead in a way that constantly takes into account the importance of management. Meanwhile, the worst use the distinction between leadership and management as an excuse to avoid the details they really have to master to see the big picture and select the right strategies. Therefore, harking back to the Bennis theorem I quoted above, let me propose a corollary: To do the right thing, a leader needs to understand what it takes to do things right, and to make sure they actually get done. When we glorify leadership too much, and management too little, there is great risk of failing to act on this obvious but powerful message”.

So when we boil down the whole leadership versus management debate – there are a few things that need to be considered:
1. Every company needs someone focused on doing both. There must be someone serving the role of CEO (big picture thinker) and someone filling the role of President/GM (get it executed)
2. These are not mutually exclusive nor do they have to be at odds with each other
3. It is difficult for one person to effectively do both roles consistently
4. Much of the success that can happen when done right centers around effective communication between the roles and with the entire team
5. Execution is still the only thing that truly matters – big pictures that are not executed are just hallucination!

So the guidance is clear. Make sure your company is practicing both roles. Balance them through continual open communication. Lead by assuring execution so you don’t spend your time spinning your wheels and hallucinating about what could be and should be. Determine the course and just get er done!

The Word From CompTIA

This week is all about the IT industry. I am at the annual CompTIA breakaway event and gathered with industry leaders from every facet of the IT world. It has already been a great event and we are only getting started. The focus of a number of the sessions has revolved around change - particularly that of the cloud and the pending changes that will be coming as that reality comes to fruition.

That said - I think more and more people are beginning to take a more balanced view of things. The sky is falling approach to dealing with it is over the top. Life is continuing in spite of the cloud. VAR's and Solution Providers continue to stay in business and serve customers. The reality is that if we take care of the customer - deliver strong customer service focused on their best interest meeting their business goals - we have a place in any new economy. It will come down to the relationship, and nothing cements it like good customer service. That does not mean we should stick out heads in the sand and pretend it is business like usual. We need to begin our due diligence into how the cloud will fit our business model and our customer's needs, and then learn all we can about selling, implementing, supporting, training and marketing it.

There was a great session that addressed some of this here at CompTIA breakaway. Here are some snippets I jotted down that I think are good to consider:

1. The channel lost 40K partners in 2009 with estimates that there are currently 210K left in the US

2. Execution will always be the differentiator

3. There are three key areas that will be hot in 2011 so cloud is only part of the real opportunity:
- Mobile
- Social networking
- Cloud

4. Many SMB customers are still waiting for cash before they spend money

5. As SMB customers shift from capex to opex it creates challenges and drives the need for cash for resellers

6. Creative financing will become critical

7. Reliance on VAR's goes up with the cloud - things get more complex, not less

8. Complexity during transition from on premise to a hybrid cloud goes up

9. Cloud means hybrid in most cases

10. Referral fees will change valuation methods when companies are sold

11. Today over 40% of partners not involved in the cloud

12. The percentage of end users currently using the cloud is almost identical

13. Becoming a sales organization becomes more critical as we sell cloud resources

14. Evolution of the roles in the channel and in a reseller company will occur

15. The could will require evolution of business models

16. Last year the best in class company metrics are 3x better when compared to average VAR

17. Business process becomes far more important in the cloud

18. Consolidation will increase in the channel as companies fail to make business model changes

19. It is critical to talk to clients about the cloud so someone else doesn't come in and do it

20. The vendors we work with will change. Apps will be sold by those closest to the client. UPS / banks / CPAs / lawyers etc. will become the new vendors

21. The last mile will be a tug of war. 38% of vendors see no need for disty and many struggle with the need for solution providers either

22. How a vendor views customer ownership must be a key factor in selecting a vendor

23. The only way to maintain margin will be to own the entire relationship from a management of the customer environment perspective

24. We really need to become cloud ambassadors

25. Training and adoption become much more important to maintain customer satisfaction and retention

26. There is a new group of partners coming on that don't have any prior baggage and will just fully embrace the cloud

This is a long list of thoughts that I gathered from different sessions here at CompTIA breakaway. My advice is to think about them strategically, plot a course, stay the course, and provide extreme customer service. In the end, he who owns the heart of the customer will win!

CRN Power100 Women in IT

CRN released their list of the 100 most powerful women in IT. I am unsure of their criteria, but there are three that definitely belong on that list from HTS/HTG. I have been privileged to work with all of them closely and have experienced their excellence and solid leadership.

A month or so ago, HTG hosted our second CEO Forum in Denver and had Colleen Abdullah who is CEO of WOW as our speaker. She was dynamic and extremly engaging. One thing she said I have not forgotten was this: "If you want to succeed in the business world today, you need to have some strong women on the management team". May be paraphrased a bit, but the message was clear. The days are over of male dominance in the board room. It is time to leverage the current generation of female leaders and leverage their skills as part of a successful management team. I can validate that statement completely.

Connie Arentson has worked at HTS for some 15 years now. She began as a field engineer, quickly moved up to become service manager and held that role until June 2009 when she was elevated to the position of president at HTS. That is one of the best decisions I have ever made in running the company. Her passion to succeed and attention to detail has propelled us to growth even when the economy was down. We had to make some tough decisions last year, but it was done with grace and consideration for all our team, and no one lost their job as we consolidated some offices. I can honestly say that had a guy been sitting in that seat it probably would have looked different. Connie is a humble, steady leader who just gets it done but never forgets about the people and relationships that make HTS a success.

Jane Cage is the ultimate partner. She came to HTS as part of a merger back in late 2002 when her Connecting Point store joined SCCI to form HTS. There is no person I know on this planet who can do magic with data like she can. Our back office has been revolutionized by her ability to make numbers talk and sing together. She is the cautious part of our leadership team, and always asks the pesky questions like "why are we doing that"? But over the years (and I am not really saying this out loud) I have come to appreciate her caution and discipline even when it slows things down some. Jane has a heart of gold and knows most of the known world, and her experience and relationships have been a blessing to our company over the years.

Christy Sacco came to HTG to help us get events right. It didn't take long with me trying to manage details that I knew we had to have help and fast. (For some reason her picture is not in the slide show, but if you go to the entire list she shows up on the list on page 15). Christy is like a never ending bundle of energy. She makes me tired just watching her, and I am usually considered the maniac of getting things done. There isn't a detail she hasn't conquered and no problem that causes her to lose too much sleep. But her biggest attribute is she is an event planner extrordinaire because she understand the channel and partners very well. She is a relationship person who knows that first and foremost it is about people. Her experience and expertise have caused HTG to have awesome events ever since she came to us. And the real challenge is how to make it better in the future when she has already produced near perfection. Of course that is me speaking - she has a whole list of details to take us to the next level.

Bottom line is that HTS/HTG has three of the Power100 women in this industry. We are in pretty good company when you look at the list for other companies that can say that. Am I proud of these women? You bet I am, and blessed to work beside them every day. It takes fantastic people in the seats on the bus if you want to really hit it out of the park. We are blessed with these three, and a whole lot more on our team. You can only expect bigger and better things from HTS and HTG as we experience the power of teamwork. The best is yet to come because our management team (which also has some amazing men) is hitting on all cylinders.

Thanks to all who allow us to serve you or call you friends. It has been a great ride for the first 25 years, and we are just getting started. Connie, Jane and Christy - I am proud of all three of you and look forward to being kept in line for some time to come. When my bride enters this mix I am surrounded on every side with no where to run or hide. Guess I will just get back to work......

CEO and Entrepreneurship

This blog post is based on some great information shared on Harvard Business Review written by Stever Robbins. You can find the original post here. Mr. Robbins gives some great thoughts on the role of a CEO and particularly on success in that role as it relates to entrepreneurship. He focuses on the reality that most CEO's likely began their journey as an entrepreneur, and as such, need to do some things differently as they grow in their leadership responsibilities. Here are some of his thoughts:

"The CEO entrepreneur sets a company's vision and strategy. The vision is why the company exists in the first place. The strategy is how the company plans to do that, given the reality of the marketplace, the competitors, regulation, technology trends, etc. Strategy includes everything from designing the organizational structure to defining the business model to choosing partners for the venture.

Great entrepreneurs make strategic opportunities. Great entrepreneurs use research, prediction, and detailed plans. But rather than hope to discover an opportunity, they make their opportunities. They build an ecosystem of customers, employees, suppliers, and partners who all have a vested interest in the company doing well. They experiment and learn, continuously altering their strategy — and indeed, their entire vision — as needed for success.

CEOs need to spend regular time on strategy. Furthermore, great entrepreneurs regularly assess their resources, relationships, and partnerships. Rather than simply trying to align around a single long-term opportunity, they should think in terms of creating a market and altering their vision with them to build an ecosystem that's greater than the sum of its parts".

So boiling it all down I see it this way. Many of us began our companies as entrepreneurs. We went to market with a product or service. We built an ecosystem of customers, suppliers, employees etc. We started without a lot of planning in many cases. We have built something based on hard work and pure will power. But that only goes so far. It runs out of steam and we have to move to the next level as leaders - to become CEO's that focus on strategy and planning. We have to focus on relationships and the people so our ecosystem takes us to the next level. We basically have to grow up in our leadership style. How much time have you spent being CEO this week? It is important work. Are you making and taking time to fill that role?

WPC Day Four

What a week - and a very well done one at that. My hats off to the team that made this week possible - Pam, Julia, Deanna and all the rest. Been attending this event now for 8 years and this was hands down the best one ever. Hard to imagine it continuing to get better each year - but somehow it has and I am very thankful for the many hours and days and months that are put in to making the experience so valuable and enjoyable.

That really is a trick - making it valuable - but also keeping it enjoyable. There was lots of content this week - maybe a bit too much as there was really no way to figure out which of the hundreds of sessions to attend. I was involved in presenting in three, and the crowds were a bit light considering how many folks were in attendance. But having lots of choice was obvious and there was something available for everyone. If you didn't get value from the content - it was definitely your fault.

For me - the week is all about relationships. And it really is based around community. My week started actually ahead of the official open of WPC - with the SMB IPAB - a partner advisory board made up of folks worldwide who are focused on serving small business. We had a great day together tackling issues that are specific to our businesses. Danielle, Mark, Turi and team have given us a great community to be part of as we carry the torch for the SMB partners. I have grown to appreciate the partners in our group very much - and appreciate that community.

Each morning I had devotions with a group of partners and took some time to get out of the chaos to get grounded and focused on what matters. We have been doing devotions daily for the last three years, and while a small group of 10-12 show up, that community is critical to keeping me focused and on track all week. We shouldn't turn off our spiritual walk just because we leave the office. Besides - a 7AM devotional time keeps people from staying out too late!

Of course attending any conference is more fun when you know folks and are part of community together. I can honestly say that part of the reason I enjoy WPC so much is that I get to meet with fellow members of HTG who are all over the place. Our orange and green shirts make it pretty easy to find one another (except for the folks from the Netherlands who seem to like orange too). Had a couple great dinners with the HTG folks and enjoyed every interaction. But it is very different going to WPC today compared to 8 years ago when I knew no one. Those were some lonely days - but motivated me to become involved in community.

SBSC may not have been center stage this year - but definitely had a presence with the yellow lounge and other places. Lots of relationships from that community which are valuable and makes it easier to feel part of this mass of people moving around WPC. Those friendships may only be renewed once a year, but it is awesome to be part of that community. Hats off to those who helped keep SBSC through the MPN transistion. Community matters, and SBSC really has an important mission. Probably does need a bit of a facelift - but there is a passionate set of partners on that advisory council that are committed to help drive it to the next level.

Last but not least for me - is the Microsoft employee community. I am blessed to know literally hundreds of folks who go to work every day for Microsoft. And they are just plain good people. We talk some business - but in most of my conversations - we also talk some life. Often we partners forget that folks who work for Microsoft or any vendor for that matter - are not the enemy - they are folks just like us that are trying to make ends meet at the end of the month. They have personal struggles and fight the same battles we do. Rather than spend time beating on them for a few bucks or trying to drive a point of margin out of the deal - how about asking them how they and their family are doing? How about treating them like the real partner they are? We lose sight of why we are in business some days. For me anyway, it is not just about making another buck. It is about living life with folks in a way that adds value to their life. It is about understanding their problems and struggles and offering any help I can give. It is about being a go giver rather than a taker. All in all I find the Microsoft people to be wonderful folks that want the same things we all do - life, love and happiness. They aren't out to take advantage of anyone - they just want to do their job and pay their mortgage like you and me.

So WPC has been a wonderful week. It doesn't just happen and serving on the WPC PEB has been an eye opener for me this year. I have been blessed to be part of a community of partners and a Microsoft team that are passionate about delivering unbelievable value to all attendees. That really is the bottom line. This event - all 14,000 plus - is all about people. The WPC team gets that and works hard to meet every one of those attendee needs. But as attendees, we need to also be part of serving one another and making sure that everyone who attends is not alone, left out, or lost in the chaos. It is all about people and relationships. I hope everyone has made some new friends this week. I sure have, and look forward to connecting and then coming next year to participate in LA as part of an even bigger community! Thanks Microsoft - for an awesome week!

WPC Day Three

The highlight of day three might surprise you - but it had nothing to do with former President Clinton speaking at the Verizon Center. In fact, I have to confess I didn't even go hear him. It happened between 7 and 8 AM at the Partners in Christ Prayer Breakfast where Amy Lucia, former Microsoft marketing guru for the US shared her life story with the room. Amy didn't share her story to tell all of us to quit what we are doing and find a new place to go to work. In fact, she was very clear that leaving Microsoft had nothing to do with Microsoft at all actually. It was all about God's call on her life, and her desire to walk in obedience to His leading.

God is in the business of calling and leading each of us. That is how He works. Through prayer, His Holy Scriptures in the Bible, and equally importantly - solitude with Him. We need to learn to slow down, stop and listen. In this rat race chaotic industry we are part of, solitude is a rare commodity. Many would say it doesn't even exist. But it does if we make it priority. If we put the need to seek God's voice ahead of rushing around - it can happen. That means no computer, no PDA, no email, no phone, no nothing - except quiet. Do you even know what that looks like? Many of us have never experienced it. We just rush through life and find out that we missed a turn somewhere back a ways. It doesn't have to be that way.

Amy talked about the need for life/work balance and how that wasn't happening at Microsoft. It is difficult in the business culture of the day. We are always pressing toward the next thing. We are always trying to climb the next step of the ladder or close that last deal. And as a result of our unwillingness (yes it is a choice we make) people around us suffer as do we ourselves. Families are in shambles because we make the wrong choice. We can justify it all day long - making more money to give you more stuff you really don't need - but doing it for you. Ever said that one? It is BS and we need to call it what it is - self centered driven behavior.

The reason this breakfast and the morning devotions we hold each day at WPC are so important is that it gives a break from the high speed full intensity experience of the week. There is no solitude anywhere in the WPC schedule. So we have to choose to make some. There is no solitude built into anyone's schedule unless we put it there. And that is key to our ability to discover what God's plan is for our lives. We will never stumble upon it. We have to seek it so we can find it. We have to make prayer and bible study part of our daily routine. It won't just fit in - we have to choose it over other things we could be doing. But when we do, God shows up. When we put Him first - great things happen.

Do you know what the purpose of your life is? Do you have a life plan? Or are you just running til you drop and hoping it all matters somehow? The odds are much higher if you put your focus on discovering the Master's plan and aligning with that. It takes work - hard work - to seek God and find out how your story fits into His Story. But it can be done, and I encourage you to make time to do it.

The IT industry has far too long been consumed with the activity of the technology. It is time to balance that with the meaningful things - the activity of life. Life has to trump work and business even though that is against everything we are taught and told. We can't check our faith at the door. It has to be core to who we are and how we live moment by moment. I know - I tried the other way for years and was frustrated and ineffective. Let God have control of your life. Put some balance back in place, and see where He leads you.

Henry Blackaby puts it this way in his book - "Experiencing God". "What our world often is seeing in our day is a devoted, committed Christian serving God. But, they are not seeing God. They comment on what we are doing, however they do not see anything happening that only can be explained in terms of the activity of God.

The world comes to know God when they see God’s nature expressed through His activity. When God starts to work, He accomplishes something that only He can do. If you or your church are not responding to God and attempting things that only He can accomplish, then you are not exercising faith.When you start to do what He tells you to do, He brings to pass what He has purposed".



Does God see the world in the way you live? Do you see God at work? If not, time to start paying attention. He is at work. He wants us to join Him. Thanks Amy, for helping us see how that looks in real life!

WPC Day Two

So a bit of a departure on the topic today as I normally don't write about technology and certainly not products, but this one is really worth discussing. Change is coming to a small business near you - and we need to get ready and prepare for our entry into this brave new world of on premise and cloud services. Microsoft has built a product just for us - so here are some thoughts....

This week marks a transition for SMB partners with the announcement of Microsoft Small Business Server "Aurora." Aurora is targeting companies on the smaller end of SMB, while the regular Small Business Server product will grow beyond the limitation of 25 users. Aurora does not come with Exchange Server and SharePoint but serves as a basic domain controller giving small businesses a stable and reliable internal on premise networking environment. Key workloads like e-mail and document management can then be handled through the use of cloud services making the maintenance and administrative overhead that's a feature of the normal Small Business Server product go away. The result is a greatly simplified product that's ideal for organizations with little or no IT expertise.

One thing that cloud doesn't do so well is file serving or backup provisioning so Aurora includes extra features to help in this area: it includes the flexible, replicated storage capabilities and remote backup features found in Windows Home Server, which are fantastic. I personally use these in our home network and love the ability to automatically backup devices with no human interaction beyond setup. This will be the first time that Microsoft takes these features out of the home and puts them in the workplace.

Beta is only a little ways down the road, so be watching for the opportunity to check this product out. It is refreshing to see Microsoft bring a very targeted solution to the SMB channel. SBS is still a fantastic product, but doesn’t give as many options for this rapidly changing technology environment that now includes the cloud, which was but a dream when SBS was designed many years ago. Having a couple options in the under 25 user space gives partners the opportunity to do what we do best – to assess the client needs and then recommend the right solution to achieve the client goals.

There is no doubt that the cloud is going to move into the SMB space – it already has in a lot of instances - and this product gives partners a great entry point into that environment. The discussions among partners have been mixed but mostly positive. The fear is that we are introducing a low cost solution that will mean a lot less revenue to the partner. That is a fact – but the same fact that cloud in general will be bringing to a corner near each of us very soon. So we can’t dwell on that – we have to dwell on the new opportunities it brings along. Aurora will definitely allow us to place servers into clients that today can’t or won’t justify spending the money. It will be very cost effective and allow us to really penetrate a bigger target audience. That is very good.

Aurora will allow us to put our toe in the cloud water – not necessarily cannibalizing our current SBS customer base – but adding more clients to support and allow us to transition our business model and learn how to leverage the cloud for the future. We have to learn this somehow – and Aurora gives us a platform to make that happen. Change is coming to the SMB partner channel. We can either embrace it and leverage a fresh and valuable new product like Aurora or stick our heads in the sand and resist hoping it all passes by as a fad. I remember when some said the Internet would be a fad………haven’t seen them around this year!

WPC Day One

I am in Washington DC to attend the most important vendor event of the year - Microsoft's WPC. The attendance is touted at 14,000, and there certainly are a lot of folks here. Not bad considering the registration fee was $1795 for the four day event plus hotel and travel. For many, who come overseas for the week, this is a pricey event to attend. But it is worth every penny from my perspective. There is no other event one can attend where you can get access to as many people in one spot with a very well designed way to connect - called ironically WPC Connect. A decent web portal to create appointments and hundreds of tables that are assigned to enable people to connect the old fashioned way - communication between four eyes. In this day of social media, email, and cell phones - talking to one another face to face is sort of a treat. And the way I spend my week here is taking advantage of that very opportunity - making as many face to face, eyeball to eyeball, connections as I can fit in.

I have to admit I skip the keynote addresses - they are recorded and available online. Plus the bloggers, tweeters, and media do a great job letting me know what was said. I have gotten over the need to sit with 10,000 of my closest friends to watch demos and hear execs give a glimpse of the future. It is valuable information - I certainly don't ignore it - but from a time use perspective - I am going to use the time to be face to face with people.

Today's key messages can be defined in one word: CLOUD. Microsoft has been talking about the cloud for at least three or four years. It is coming, it is real, and I certainly don't believe we should stick our heads in the sand and pretend it doesn't exist. It does and it will impact how we do business. Ballmer is quoted as saying: "We’ve been shouting about cloud for about four years but 2010 is the year when the opportunity and transition to the cloud is absolutely clear." The message has been coming for some time. Had we moved four years ago we would be doing something differently for a living right now. I agree it is slowly progressing. But it is still a very immature technology in terms of how it fits in a VAR business model.

My major question is how a partner who still makes a significant amount of margin from implementation of solutions including hardware and software sales can make the transition. I am yet to see how we can take our 16M business - about half of the margin coming from selling hardware, and half from managed and project services - and generate that on 6% BPOS margins. Do you know how many $10 per user sales at 6% margin it takes to generate the replacement margin to keep our company in business? It is millions of users. Sure in three years we are all good. I can do the math and see that there is a point at which the cloud model actually becomes more profitable. But how do I make payroll for the three year transiton? Do I just stop doing payroll while we make the change? When I checked last with my staff if they love coming to work enough to come if I stop paying them - the answer was no.

Any time there is a disruptive technology it creates opportunity. That has been the case the dozens of times we have re-engineered our companies as VAR's over the past few decades. And it has been the history of our industry - we will again find a way to make the transition and stay relevant and in business. But it isn't going to be a shift from our current state to a new world of cloud overnight. There are lots of reasons that doesn't even work technologically, let alone financially. So the hype is a bit over the top. VAR's own the last mile of the customer relationship. VAR's will decide when the transition to cloud occurs in the SMB. The real need to move this along is to create transition models that enable VAR's to create business models that enable that transition. New technical skills, a need to become sales organizations, marketing and pipeline growth, and many other areas have to be addressed for us to make that change.

So thanks for continuing to push us along Microsoft. We are moving, not at your speed probably, but the more you help us figure out how to transition successfully, the faster we will embrace the model and make cloud the thing 2o1o is remembered for.

Weekend on the Farm III

This was first sent out in the July 1 HTG newsletter - but it is such an important topic I wanted to share it broader.....

On June 25-27, Nancy and I hosted our third annual Weekend on the Farm which is a leadership training session with a spiritual bent. We do this event for people that get my daily email update each morning on life and my study of scripture. (If you want to be added to that list just send me an email requesting addition to the distribution list) Our first event focused on the book "The Go Giver" and last year we studied "Lead Like Jesus". This year – our instruction came from the pages of the Bible as we learned lessons on leadership from Nehemiah. He may have lived nearly 2500 years ago, but as is often the case, there are a lot of similarities to what he dealt with when compared to being a business leader today.

We had several HTG members who served as teachers this weekend, and we covered topics around preparing to lead, planning, motivating people, organizing a project, handling opposition, dealing with conflict, achieving and maintaining success and a few other areas. There were many gems from the weekend teaching that hit me right between the eyes, but I want to share a couple that I think really are worth considering.

Steve Bender, who runs InHouse IT in Orange County, a company of about 70 employees that delivers managed services to their clients, was the guy we had tasked with putting a bow on all the things we had heard. He shared a couple very insightful thoughts:

Lesson #1 – nothing happens until somebody steps up to lead

Think about that. It is really the way things are. A lot of people have great ideas, can dream big plans, come up with fantastic ways to do marvelous things – but until someone steps up and leads – it is just theory and empty words. It really defines our motto that "Vision without execution is hallucination". Ideas without leadership are simply that – hallucination. You see it all around your patch every day. On community boards, church committees, school events – we have lots of people with ideas and very few who step up to do something about them. And sometimes we have that disease in our own company. We attend conference after conference and feverishly take notes to bring back and simply put them in a file or maybe even talk about them with our staff, but we don't step up to lead and make sure they get done. Do you ever have that happen in your world?

We may go the next step and dump them on someone else's plate to do for us. Often we give them some cryptic idea we jotted down and say "just do it" without investing the time to explain the "why" to them. That creates a bit of a dilemma for our people, because they didn't hear the presentation we got the idea from so have no context. They are supposed to figure it out via some form of osmosis since we passed it to them. Leadership doesn't dump and run on anyone. It means we clearly define the "why" and then lay out the how, what, when, where and who. If you simply drop it on their laps – well no wonder they don't like you going to HTG meetings. There is no way they can succeed. That is a very good reason to bring a key leader with you – so they understand the context of the ideas and best practices before they are asked to execute.

Lesson #2 – leadership doesn't stop when we go out the door from the office

So I am about to stomp on your toes here. Mine are currently all broken after Steve jumped on them this weekend. For some strange reason we are able to lead effectively in the office but once we leave – we go on autopilot and stop providing that leadership. A leader does one thing continually – they lead. That skill is not tied to your desk at work. It is a gift that you have been wired with that needs to follow you in every interaction and relationship you have. I know all the excuses – heck I use them myself. Too tired, just want to get away from dealing with people, somebody else should do it for a change, I need some space, and my calendar is too full and on it goes. I am currently throwing the BS flag at you. Leadership does not stop at the door. In fact, there is always a need for leaders to lead.

The first place we should lead is at home. Life-work balance requires leadership. Things will take over our time and destroy our balance unless we lead. That is a fact you can see just by looking in the mirror. If you don't prepare and plan – you will be overwhelmed by work and feel like you have no options other than spending 18 hours a day doing a job you can never finish. Your spouse and kids need a leader. Families disintegrate because leaders don't lead. This isn't about being the "boss" at home. Real leadership is about serving others. Real leaders put other people's needs first. Your family needs you to be that kind of a leader. No one else is going to do it. If you don't lead, nothing happens. So start at home.

The world is filled with committees and groups that waste tens of thousands or millions of man hours floundering around because leaders are content to just sit there and watch it happen. It would be too much to take responsibility to lead this group or that committee is what we think. After all, I am worn out from my leadership at work. BS! We don't lead because we get lazy. We aren't willing to make a commitment to the mission of the project or group, but we are willing to waste our time being part of a non-functional team. C'mon – if you have time to be part of something you need to step up and lead. Nothing happens until someone provides leadership.

Churches – like many groups – today often flounder around because members aren’t willing to make commitments. Most are filled with successful people that get up Monday through Friday and go to work and lead successful businesses. But when they walk through the doors of their local church or synagogue, somehow they forgot everything they know and use all week. This is not how you make a true difference. We need to put the effort into leading at church at least equal to what we do in the workplace.

Organizations like HTG struggle with leadership too. We are comprised of 250 successful entrepreneurial leaders. You would think we would never lack for a willing leader to step up . . . but we do. Members cut corners in getting their preparations ready for the meetings and posted so the group can be effective. We struggle to get members to step up to be part of a champ program for our platinum vendors. Members cut out of their group meetings early for personal convenience leaving the rest of their group hampered by their lack of input. If there is anyplace I would expect there to be an abundance of leaders – well it would be HTG. We need to set that standard high and hold each other to it. One area all leaders need to be is accountable. That example is critical if we are going to lead effectively.

Are you really a leader – because leadership is a full time gig. Not just 8-5 Monday through Friday. Leaders lead in life and community too. Don't miss that very important lesson. There is no question that by being a leader 24/7/365 you will be part of a very elite club. Few do it that way, but it is the only way to truly be effective. People want to follow someone who leads all the time, not just when they are watching. Don't make the mistake of being a part time leader. It will only disappoint your followers, and soon you will look back and wonder where they all went!

Roundtables4Roundtables Part IV

So let’s tackle some of these common issues that most small businesses face today. Let’s cut to the core and admit that unless the business works for us – all we really have is a job. Let’s admit that if things don’t go on when we are away – if we are tied to the pda or phone or email when we are supposed to be coaching soccer for our kids or have our family away on vacation – or even worse can’t remember the last time we were on vacation – let’s admit all we have done is put lipstick on a job and really don’t have a business at all. So that is step one. Evaluate whether or not you really have a business at all. There is nothing wrong with having a reliable job that provides for your needs by the way. Just don’t call it something it isn’t. Let’s get our terms straight. If you have a business – it is not dependent on you to proceed and operate. If you have a business – you can get away and have a life. If you have a business – it is not about YOU.

OK – so those who are left with me – let’s address the first issue that I see most business owners have failed to tackle. The “WHY” of their business. So many businesses today focus on the who, what, when, where, how – but they totally skip the why. WHY is the reason your business exists in the first place? It is where your passion comes from. And by the way, if you aren’t passionate about your business, if you can’t wait to get started each day, you probably have a job. Why did you create this business? What is the PURPOSE it was designed to serve? What do you want to accomplish through it? Do you know the “why”? Answering that question is a key part of writing a business plan. It is core to the motivation for everything else that will happen as part of running your business. It IS the key to success and happiness. Without the “why” you can’t possibly know where you are going or how you will get there. You are directionless and wandering in the wilderness. So make sure you know the “why”.

Do you need a business plan? The short answer is yes. You need it for a few reasons:

1. It is the basis to hold an owner accountable. You run your business because you want to be your own boss. That is good in some ways but very bad in others. You need to be accountable and a business plan is part of it.

2. If you participate in any kind of peer group – your group members have to have it. Without your business plan they can’t really give you any meaningful guidance because they have no idea where you are headed.

3. Your employees need it as well. They are on the journey with you. They can’t really do their job until they know what the destination is. The business plan is not about you. It is about the business and the “us” that make it up.

4. Your family should know so they can understand what it will take for you to succeed. That also should give them some opportunity to provide feedback on just how often you will be gone and miss important family activities and events.

5. Your banker should care. Unfortunately many never ask for it – but you should offer to share it and set yourself apart from the majority of small businesses by doing so. And if you don’t have a banking relationship – get one. It is far easier to ask for money when you don’t need it than when you do.

6. Your vendors should care too. Part of your business plan should include key vendor relationships and how that will look in the next 12 months. You may write an individual plan with key vendors – but I suggest you include some parts of it in your overall business plan.

One key reason to know “why” is that it is essential to have any hope of achieving life-work balance. Without the “why” there is likely nothing that will keep you from working all your waking hours in your business except pure exhaustion. The “why” needs to also address your life. It is a key component of writing a life plan. You have to know what the purpose of your life is. Why do you get up each morning? What is it that you want to accomplish through living? Not through your business – but as a result of living your 168 hours this week? Do you know those answers? Have you thought about it? Once you put it on paper and share it with peers or even your spouse – someone can begin to hold you accountable to make sure your actions match your goals. Without accountability life will always lose to business. We are wired that way as entrepreneurial business owners. We can’t afford to let life lose. It has to be top priority.

Life-work balance involves a lot of areas. That is why HTG uses a life planning document to help give some direction on areas you should consider. There is so much to ponder and it is the important stuff. Business is so fleeting. Life is so eternal. Life matters and how we live it matters a lot. No one will wish on their deathbed that they had spent more time in the office. Many will say they missed far too much life by spending too much time working in their business. You can’t change it at that time. The change has to happen now and it can’t be postponed. Do you have it balanced?

CEO Forum II Focuses on Strategy

This past week we also hosted our second HTG CEO Forum in Denver. Our initial meeting was talked about here. We had 14 companies represented and we had an amazing time together. Our time began with a checkup on goals from the last session. Some work still to be done there, but folks are working hard to make that transition to the CEO role. It is a very big change of mindset and thinking for most of us.

We had a special visit from Colleen Abdullah who is CEO of WOW – an Internet, cable, telephony provider. It was a very engaging hour and a half as she shared her transition into that role and the success she has had as she created a culture of being focused on the customer – both internal and external. That is the secret sauce – paying attention to people. Colleen is a great role model as she took over a company that was doing $9 million and today is doing many times that in revenue – over $500 million as I recall. She has done it by excelling in the people business. She admitted that her products were not all that different or unique – hard to differentiate in a market where everyone pretty much has the same tools and offerings. But where WOW wins is in the hearts of their customers and people as they provide a level of service and caring that is unique to their industry. They “WOW” their employees and end users and win in the markets they serve.

She also challenged us to stay close to customers and our teams. Her approach is to take time monthly to ride in the trucks and be on the phones with her staff. She stays connected to what is happening. She is also active in the association representing smaller cable providers. A great lesson here – we need to be engaged with our industry in watching legislation and other influences that will impact us. Silence is not golden when it comes to lobbying the legislative process.

We shifted gears after that as my son Pete shared about the importance of process. He taught us about Six Sigma and Lean as tools that can be used to help create standardized methodology and take cost out of our businesses. These are enterprise level tools but they contain many facets that will work effectively for us in small business. We just need to learn and understand how to use the things that fit to help keep us competitive in the marketplace. As commoditization ramps in managed services and cloud solutions – efficiency and taking cost out will be the name of the game. These types of skills will be important for us to compete effectively.

Day two was spent with Ryan Morris from MMP. He led us through a full day workshop on strategic planning – one of the key roles a CEO needs to fulfill. Ryan broke things down and helped us understand the basics of strategy. It isn’t necessarily rocket science, but rather a persistent and total focus on a single objective. Not the scatter gun, throw it up on the wall and see what sticks, hope I guessed right, sell to whoever will write a check kind of approach. Those don’t work as you grow a company. He assured us that we will not always get it right, but we need to set and then monitor and change our strategy on an ongoing basis.

The reality is that strategy is really only effective with about a 3 year look forward. Beyond that it is more of a general goal. His guidance is a detailed 6 month plan, followed by an 18 month set of objectives that point to a three year strategy. It must be evaluated and tweaked every quarter and is not failure if it needs adjustment. We learned that key factors that impact our strategic plan – like resources and external factors – are outside our control and will change. Sometimes that change will require us to tweak our strategy and we need to be on top of it so we get that done.

It was a great combination – discussion around strategy and process – as those are the two keys to running a successful long term organization. Both need to be on the radar of the CEO. They both are a lot of hard work, so job security is built in. But as we listened to our trainers, and to our guest expert, we had to have heard those words a few hundred times. Success is not accidental. Luck and timing can play a part for sure – but success happens when leaders plan and execute and tweak and execute and revise and execute. If things are not going well in your company – time to go look in the mirror. You may need to have a talk with yourself!