Partner Lessons from Building a Cloud-Ready Business

Editor's Note: A big challenge for longtime Microsoft partners is managing the transition from providing on-premises services and billing to getting profitable in the newer cloud models. In this guest post, Tim Wallis, founder and CEO of enterprise Office 365 and SharePoint consultancy Content and Code, describes how the U.K.-based firm made the switch from a project-based business to a managed service provider.

In my business, it pays to embrace change, and in this day and age I think that has never been more true. As we continue to face ever more uncertainty -- both economically and politically -- the need for a business to be flexible is not only an advantage, but is becoming a fundamental necessity.

Today, I want to talk about my experience of this "new normal" of business flexibility, and show how to take advantage of the opportunities it presents. I'll show how my company moved from an on-premises business to a cloud business, from project-based services to a managed services model. I'll talk about overcoming the resistance we encountered, how we customized our client approach and restructured our workforce to turn us into one of the leading Microsoft Partners in the United Kingdom.

Content and Code started out as an applications service provider (ASP). Essentially, we took Microsoft software and built our own private cloud infrastructure, then rented out this space to various tenants. Back in 2001, we were the only company doing this in the United Kingdom with Microsoft Content Management Server and SharePoint. And what was great for us was that we were able to successfully take advantage of the weak financial climate around after the dot-com crash in 2001, where people wanted to rent rather than buy.

Then from 2004 to 2007 the economy improved and we mainly delivered on-premises solutions as clients had money and wanted to buy rather than rent.

Fast-forward half a decade, and Microsoft released Business Productivity Online Services (BPOS, the precursor to Office 365). This provided a lot more than collaboration and publishing. We knew this was the start of something big, and we realised that by moving our business and our clients to the cloud, we could build a bigger business that could really change the way the world works.

Internal Resistance
Moving our business to the cloud has been, ultimately, very beneficial for us. Nonetheless, the move itself caused a considerable amount of initial internal resistance with our employees. Understandably, they were worried about what such a change meant for them.

I can break it down into three areas:

For Content and Code Developers
The early versions of the cloud platform didn't allow as much development and customization as they would have liked, and a very large percentage of our staff are developers who love to customize and tweak the products. So, moving to the cloud meant that the projects weren't as interesting for them and there was less scope for them to flex their creative muscles. Luckily, nowadays, the cloud versions offer more than the on-premises equivalents.

For Our Project Management Office
Our PMO was used to scheduling big, on-premises SharePoint projects that we were very much in control of. We built the SharePoint environment, developed for many months, then launched an amazing digital workplace. When you move to cloud, Microsoft and the client are more in control over the infrastructure and you tend to work in smaller, more iterative work packages. From a scheduling point of view, running a cloud practice is much more "bitty" with shorter-term, incremental engagements.

The Quality of Early Cloud Products
Finally, the early cloud versions of products -- Office Communications Server, Lync, et cetera -- just weren't the polished products you see today. The vision was there, but essentially Microsoft had taken its on-premises products and put them in the cloud. Today, their products are purpose-built for the cloud and are consequently of a much higher quality. Innovation now happens much faster on the cloud products.

In terms of the structure of the company, a much higher proportion of our revenue now comes from managed services, which for us are a range of activities aimed at helping clients get the most out of their cloud investments. This has required building a managed services team, including a specialist managed services salesperson and a new Head of Managed Services to drive that part of our business. Today, our managed services business is growing at about 20 percent a year, which is a testament to how much we have adapted.

External Resistance
Our other difficulty in moving from large, project-based work to a managed services focus was resistance from our clients. It can be hard to convince your client of the value of an ongoing managed service over only a project. People understand big projects -- there's a tangible thing at the end of the process -- whereas managed services are more incremental or iterative, meaning their impact is often harder to measure. Microsoft sales teams also promise free support with Office 365, so it can be difficult for a client to differentiate between Microsoft's limited free support and our managed service model that covers adoption, analytics and a whole lot more.

It may sound obvious, but customizing your approach for different clients is a huge part of getting them on board with change. Some clients might be starting out with Exchange Online e-mail first, others with SharePoint. We build a customized "value journey" for our clients that focuses on getting the full value from their Microsoft investment. This is not only about IT deployment, but far more around change management and user adoption. For example, our managed service offerings are more about user analytics of a particular piece of software -- what they are (and are not) using and, based on that, delivering better ROI for the client.

Staffing Evolution
With the change in method and technology comes an inevitable change in staffing. We restructured from employing (principally) development-focused, technical people to a more business-focused team. It wasn't easy, but we had to change our offerings, because often we are doing less technical work for clients and a lot more adoption and change management. As a result, many of our employees are now change management-certified via Prosci. Of course, we still have all the technical staff, but have a greater emphasis on business-focused staff now.

One of our unique features has always been about user research and understanding how people interact with technology -- how they use it today and how they should use it tomorrow. We want to change the way the world works and the changing landscape has prompted us to reevaluate and remodel how we provide for our clients. Our method was to first build the capacity and then restructure the company, essentially, into five teams:

• Our engagement and program management team helps our clients manage and run digital transformation projects and ensures we deliver great ROI for our clients.
  
  
• The client success team includes business-focused change management, user experience and user adoption experts.
  
  
• The enterprise strategy and architecture team houses our technical consulting staff.
  
  
• Development, which does what it says -- development, quality assurance and application lifecycle management.
  
  
• Underpinning it all is the technology enablement team that covers infrastructure from identity and access; to Skype for Business; to OneDrive, SharePoint, Exchange; and all the security offerings.

Continuous Change Management
Change can be hard to bring about, so we message our change very carefully. It's vital to make sure your employees know what's happening in the organization, and so we talk about it as much as possible every week during our inclusive companywide meetings. Staff need to know the "why" of what we are doing because people do get confused, and any change within an organization can unsettle people so it needs to be communicated as widely as possible.

The continued evolution of Office 365 means we have to make sure our people are skilled at working with new and evolving Microsoft tools such as OneDrive, Planner, Office 365 Video or Sway. Keeping up with the pace of change can be difficult, but we have put in place a number of processes to help accommodate our people's continued learning:

• Lunch & Learn and Beer O'Clock, where individuals present what they are working on and new concepts and ideas in a relaxed, informal atmosphere.
  
  
• Using Yammer internally to make sure everyone is talking about what they are doing.
  
  
• Training courses and subscriptions to continuous-learning Web sites.

Creating Change in Your Business
There's no blueprint for success with the cloud because it evolves so fast. The biggest issue for us was getting everyone on board, and that comes from following best practices:

• Focus on metrics. Saving money on mobile phone bills and travel costs by using Skype is a big thing. But if you don't measure it, you don't know how much you are saving. Share these metrics with staff so they see the benefit of the change, which will really boost your internal adoption.
  
  
• Drink your own champagne. You also need to provide user training for new products to gain the value of the change. Unless your staff really use and believe in the technology, they won't be able to be the trusted adviser to clients.

Differentiation Is Key
Clients can often view the various partners they talk to as potential "removal men," viewing the cloud as something managed by Microsoft and all you're doing is picking up their apps and content and moving it to the cloud. It can be difficult for clients to see how you are different. But differentiating is absolutely key.

Make sure you have a very specific value proposition and clear intellectual property around what you are doing. At Content and Code, we have a lot of intellectual property around our methodology, our digital value report and Fresh, our digital workplace accelerator. These things highlight our differentiation. So, differentiate rather than being just another "removal company."

Find out more about Content and Code and its story here. You can also follow Tim's latest Tweets @timwallis.

Posted on September 14, 2016