Get started Bring yourself up to speed with our introductory content.

Vetting cloud service providers: Five things to consider

Your investigation of potential cloud services provider partners should hinge upon more than customer preference, says Jason Bystrak of Ingram Micro Cloud.

When picking cloud services providers, solution providers put customer preference at the top of their list of vetting...

criteria, according to CompTIA's 2014 annual report on cloud computing trends. Only 11% of surveyed solution providers dismissed this as unimportant, so clearly customer preference has a lot of sway. But should it?

Customer preference is important, but so are considerations such as determining if a service provider partner is financially sound and if its technology is a good fit for your customers. You'll want to properly vet any potential cloud partners to avoid getting stuck with providers that offer poor partner support or overhyped technology that doesn't work as promised. And certainly you want to avoid a provider that goes out of business a few months after you sign a contract.

Here are five considerations for vetting a cloud service provider:

A good match

Jason Bystrak, Ingram MicroJason Bystrak

Is the solution a good fit for your business? You need to have the sales, technical and operational skills and resources to support the technology -- or the means to invest in them. Beyond that, does the technology address a need within your customer base? Solution providers know their customers' pain points better than anyone, so you are the most qualified to make this judgment. It helps to conduct market analysis to determine if existing clients will adopt the solution, if it will draw new clients and what competitors are doing.

Financial stability

Predicting how long a cloud provider will stay in business is tricky, especially considering most cloud providers are startups without much of a track record. A company in investment mode probably isn't profitable, but that shouldn't be enough to scare you away. Learn its plans to capitalize the business and timeline for achieving profit. Ask for past financial milestones to get a sense of whether the company is likely to meet its targets. Vet the executives as well: Based on their past successes or failures, is the company in good hands?

Partner support

A company in investment mode probably isn't profitable, but that shouldn't be enough to scare you away.

A cloud provider can have the best technology in the world but still do a poor job of supporting partners, so be sure to check what resources the provider offers to help partners adopt the technology. The roles and responsibilities of provider and partner in delivering the service should be well-defined. The provider must lay out all steps involved, from prospecting, sales and assessment to on-boarding, invoicing and post-sale support. Check if the provider has clear rules of engagement to avoid conflict between partners and direct sales.

Profit potential

You must understand cost of delivery to protect your margins. If the provider plays a big role in service delivery, the margin is bound to be tighter than if you do most of the work. Still, a bigger provider role may reduce your investment and free up resources for other opportunities. Profit also is related to opportunity costs: If you choose a particular vendor's solution, does it prevent you from investing in other offerings? Determine the right balance. It helps to build a two- to three-year financial model to understand the opportunity, establish milestones and determine the true ROI of the service offering.

Security

Security is the top reason clients switch cloud services providers, according to CompTIA, so make it part of the vetting process. Cloud providers should be able to provide industry-standard security certifications, and you need to understand liability and how to handle worst-case scenarios.

One way to condense the vetting process is to check if the provider has earned the CompTIA Cloud Trustmark+, which certifies the provider has met certain requirements related to best practices and service delivery. A Trustmark helps you make a safer bet -- and in the new frontier of cloud computing, any help you can get in making a good partner choice is always welcome. With the right amount of vetting, you can go forth and conquer.

About the author:
Jason Bystrak is executive director of the Americas at Ingram Micro Cloud and vice chair for the CompTIA Cloud Community. He is responsible for leading and developing Ingram Micro's sales and market development organizations and driving growth and operational excellence for the division and its portfolio of cloud, managed, professional and training solutions. Bystrak has been with Ingram Micro since 1995.

Next Steps

Find out about CompTIA's Cloud Trustmark+

Jason Bystrak offers tips for selling cloud services

Learn about the importance of having 'farmers' on your cloud services sales team

This was last published in March 2015

Dig Deeper on Cloud Ecosystem for Cloud Service Providers

PRO+

Content

Find more PRO+ content and other member only offers, here.

Join the conversation

3 comments

Send me notifications when other members comment.

By submitting you agree to receive email from TechTarget and its partners. If you reside outside of the United States, you consent to having your personal data transferred to and processed in the United States. Privacy

Please create a username to comment.

What lessons have you learned from your partnerships with cloud services providers?
Cancel
First, that we prefer a single tenancy for our cloud services. Second, we've discovered that because we need some customized cloud services for our data, we need to choose an individual plan for our organization. Although this costs more than a multiple tenant situation, it's definitely better for us. Finally, we've learned to overestimate our bandwidth needs by at least 50 percent. This has helped us to ensure that we get the performance and speed our applications require.
Cancel
This is a great set to qualify providers, rather than just thinking service, price, security, backup, downtime and scale, fully investigate the organization too.
Cancel

-ADS BY GOOGLE

SearchITChannel

MicroscopeUK

SearchTelecom

SearchAWS

SearchCloudStorage

SearchCloudComputing

SearchCloudSecurity

SearchCloudApplications

Close