Partnerships in the business world are dynamic and ever-evolving, making it hard for incoming partnerships pros to get a handle on the complexities surrounding the field. To help alleviate that issue, Firneo co-founder and CEO Scott Pollack has been holding insightful discussions in Firneo’s ongoing Partner School series.

In a recent interview, Scott delved into the world of system integrators (SIs) with Omair Rana. Omair has worked as Microsoft’s Director of Partner Strategy, Guild Education’s Senior Director of Go-To-Market Channel and Ecosystems Strategy, and in various roles at prominent SIs. His discussion with Scott demystified SIs and explored their significance in the partnerships domain.

Unraveling the SI Puzzle

Before partnerships pros can create partnerships with SIs, they’ll need to understand what an SI is. As an industry expert with experience at top-tier consulting firms like Boston Consulting Group, Omair was able to help unravel this mystery.

SIs are companies hired to bring together and integrate various systems, solving complex business problems through technology. Historically, this has revolved around installing and configuring on-premises software, but most software solutions are now cloud-based. As a result, SIs now focus on bringing together and connecting various cloud-based solutions to address specific business challenges, making them invaluable partners for companies of all sizes.

Omair went on to detail the vast array of services SIs provide, including advisory, assessment, solution design, product selection, and RFP management. These companies act as one-stop shops that offer a suite of services to clients seeking integrated solutions. SIs also come in various sizes, ranging from global giants that routinely work with Fortune 500 companies to mid-tier and smaller firms.

Types of SIs: From GSI to VAR and MSP

Scott and Omair’s conversation navigated the alphabet soup of SI classifications. As part of this, Omair distinguished between GSIs (Global System Integrators), RSIs (Regional System Integrators), VARs (Value-Added Resellers), and MSPs (Managed Service Providers). He defined GSIs as large SIs with a worldwide presence, RSIs as SIs that focus on a specific territory, VARs as partners who resell software and add value to it in the form of additional services, and MSPs as partners who sell outcomes and managed services.

Of course, the diverse terminology associated with SIs can make things complicated. Along with that, today’s clients are more focused on outcomes and problem-solving than labels like SI, VAR, or MSP. Considering these factors and the rise of hyper-scaling solutions and cloud services, Omair acknowledged that a shift towards terms like “solution provider” or “solution integrator” might be more fitting. Still, industry professionals need to have a baseline understanding of the terms defined above.

The Evolution of SI Business Models

The fascinating journey of SI business models over the past few decades was another topic of discussion for Omair and Scott. Initially, clients paid SIs for time invested in integration projects. The model has since shifted towards outcome-based solutions: clients now seek to pay for specific integrated outcomes based on measurable objectives like interfaces created, systems connected, and solutions gone live.

The evolution of SIs hasn’t stopped there—instead of simply integrating systems, these companies now actively recommend and resell software solutions. Furthermore, SIs have ventured into maintenance and support, offering ongoing services for the solutions they implement. As SIs that take ownership of the entire problem set and focus on delivering outcomes to clients, MSPs are a perfect example of this shift.

Building Strategic Partnerships with SIs

Today, SIs are a vital part of the broader partnerships ecosystem. Because they are responsible for advising their clients and implementing solutions for them, Omair noted that SIs have uniquely direct access to their clients. That positions them as potential channels for upselling, reselling, and adding value for vendors seeking to reach a broader audience.

For companies seeking to collaborate with SIs, Omair provided valuable insights into the factors that attract SIs to partnerships. Vendors should target SIs that offer compatible capabilities and client bases, and craft compelling stories that demonstrate how a partnership could help both parties generate revenue and achieve mutual success. Identifying SIs that are strong candidates for a partnership and building a value proposition around shared problem-solving will create a solid foundation for collaboration.

Along with that, partnerships pros need to know when to approach SIs for collaboration—and that depends on the readiness of your product. If your product is stable, has won clients, and offers a clear opportunity for SIs to earn a return, it’s an appropriate time to explore partnerships. Conversely, a successful collaboration will be unlikely if you approach SIs without a stable product or a compelling value proposition.

The success of SI partnerships is all about aligning goals, fostering collaborative relationships, and managing expectations. Mutual success is achieved when both parties contribute to solving client needs, share leads and accounts, and work together to build value propositions. 

Challenges and Downsides

Of course, collaborating with SIs comes with potential challenges, including revenue sharing and potential impacts on your product’s reputation. If things go awry, the blame may be shifted, affecting your brand.

Misaligned expectations, poor training, and inadequate enablement can lead to unsuccessful partnerships between SIs and other entities. As is the case for other partnerships, clear communication and collaboration play an indispensable role in ensuring the success of these relationships.

While SIs are a crucial component of a company’s partnerships strategy, it’s critical to remember that they don’t represent the entire partner ecosystem. A broader approach should also consider contributions from other vendors, clients, and related entities. By understanding each participant’s role and contribution, companies will be able to navigate the ecosystem as a whole.

Improve Your SI Partnerships Game with Firneo

Though their specific duties have changed, system integrators still play a pivotal role in many partnerships programs. By making an effort to understand the nuances of SIs, businesses will be prepared to build meaningful connections with one or more companies in the industry. 

Omair and Scott’s discussion should give you the basics on creating partnerships with SIs, but the partnerships industry is too complex to explain in a single article. If you didn’t get thorough guidance about working in this field when you entered your first partnerships role, Firneo can help. Learn everything you need to know about establishing successful partnerships by enrolling in our Mastering Partnerships Strategy program!

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