Partnering for Success through Co-opetition

Rajat: Welcome everyone to an all-new episode of the Zinnov podcast focused on co-opetition, cooperation and collaboration in the partner ecosystem. I’m Rajat Kohli, Partner at Zinnov and your host for today. To go deeper into the topic, today, competition, cooperation and collaboration are integral components of a healthy and growing partnership ecosystem.
While healthy competition drives innovation, cooperation allows organizations to collaborate on common goals while maintaining competitive edge. Together, these components contribute to the overall growth and adaptability of the partnership ecosystem, enabling organizations to navigate dynamic market conditions effectively.
The delicate balance between competition and collaboration remains crucial for success in a rapidly evolving business landscape. Today, I have the privilege of speaking with Ethel Garcia, Head of Global New Customer Acquisition Partner Strategy at Amazon Web Services. Ethel is a global expert on the technology partner ecosystems as well as New Customer Acquisition and defining the business strategy for that.
Welcome, Ethel. We are thrilled to have you with us today.

Ethel: Thank you Rajat. It’s great to be here. Thanks for the for the invite. It’s been great working with you too. So I’m eager to be in this conversation and share my perspective and experience.

Rajat: Thank you. Awesome. Likewise, I’m also super excited to have this conversation and let’s dive into it at it. But before I get into the world of the partner ecosystem, what’s happening in that it will be good to get some understanding from you about your journey and experience in the partner world.

Ethel: Absolutely so it’s been quite a journey. I’ve been more than 20 years working on the tech industry and always on the hyperscaler side of it.
So I worked for many years for a competitor, in the European industry and then back in the U. S. industry. It’s been a journey across working with partners from my technology background by, you know, building with them to more like, you know, developing the business with them, building marketing strategies with them, go to market strategies with them and also strategizing in these hyperscalers how to work together, better, faster and succeeding with them. So a lot of anecdotes across multiple partners types. A lot of great learnings. So it’s great to be here to share more. Thanks.

Rajat: Great. I’m sure that in this entire journey you have seen the evolution as well as the disruption in the partner ecosystem.

Ethel: Absolutely. I think it’s more than an evolution. It’s constant, it’s a day to day it’s happening. And pretty much across the board in multiple dimensions. It’s non stop and even more now that, you know, everybody’s eager to get to more partner ecosystems, creation, new business model, and ideation and then, you know, keep the pace with the technology. It’s always that it’s top of mind for all of us here.

Rajat: Great, and Ethel, if you look at the current partner ecosystem, how can companies balance partner co-opetition and innovation in this dynamic landscape, ensuring the benefits, the return on investments? As well as the collaborative initiatives contribute to the market leaderships. So what is your viewpoint around that?

Ethel: Yes. Part of the question, co-opetition and innovation. The innovation piece. It’s part of being a market leader, right? It’s where everybody wants to be on that quadrant. Right?
And it requires several strategies to get there because you have to combine the innovation piece with the go to market piece. Right? And during that go to market piece, you have that co-opetition. So, from my experience, the strategy is that most of the hyperscalers, some big partners are following up cut across multiple dimensions. There is enough.

The growth that the global IT market will reach in a couple of years or three years, is enormous. We’re talking about 6.4 trillion that is out there, which actually that represent an almost an incremental of $600 billion for partners worldwide.
So that balance between innovation and coopetition and go to market. it’s a fundamental piece across any strategy. But just to name a few pieces, you know, it’s very important to encouraged internally on those partners, a collaborative environment and also incentivize that collaboration. That’s critical, right? It’s part of the mindset. It’s part of working the together, joint projects across car development and cost selling initiatives is critical. That actually helps lead to creation of unique solutions, that those partners are looking at, even between partners themselves.

There is more and more appetite to understand. Could we do something together? Right? Could it be we actually put something in market together? That might impact across how do you do business, right? And what is even your value around that? Some hyperscalers call, call it like partner to partner play, right?

And some others call it tri-party play, but it’s kind of like this open door that is not isolated anymore. To get to that position, I want to do something in partnership with another partner that might compliment each other. And also as part of that, it’s important to have continuous improvement and adaptability, right? Be agile. These days is critical, um, across all these changes and emerging technologies. Encourage that culture across the company. It’s important. You know, customer centric approach, cuts across pretty much everything, right?

It’s not about the technology anymore. It’s about the value, right? The customer business value that that technology is going to bring. And how do, how do we position that? Right? That involves thought leadership, right? And industry involvement. So there are different pieces that I think are important to bring together as part of your partner strategy, even if you’re a hyperscaler or not.

Rajat: Great, that’s an interesting perspective and I picked up some of the words that you highlighted one. Definitely the 600 billion opportunity for the partners. Then the second and important term that you touched upon is tri party, and the third I think everyone is focused around is value.
Those are some of the very interesting strategies you shared with us at all. And I’d like to pick your brains about the hyperscalers in this competitive round of the top hyperscalers specifically focusing on Gen AI, the platform engineering as well as the cloud marketplaces. What strategies and the best practices would you recommend for differentiating among peers and sustaining engagement with new age ISVs?

Ethel: Great question. ISVs, very close to my heart, too. So ISVs, for hyperscalers are pretty much like they’re seen as a catalyst, right? These are technology creators, right? It’s the big multiply effect that everybody talks about, right? A hyperscaler is looking at ISVs to partner with them to influence the solutions that they’re building, horizontal, vertical. They package that solution and they’re going to go after the market.
And that’s where hyperscalers are very interested or working closer and deeper with this partner types and in order to capture their attention and or even like, create, you know, more additional value for this entities. Cutting edge technologies are critical. You mentioned AI as an example.
I think everybody’s talking about it including, you know, family members that they don’t work on technology. They talk about, right? And it’s an incredible opportunity. To create an immense value across any type of business, right? Not only ISVs, but, you know, any industries, any solution types. There is a lot of new use cases being emerging, right?

And as ISVs that are looking always to incorporate new value, new features into their offering. They need to understand how to use Gen AI into their solutions, right? And the hyperscalers function, I think it’s more connected to the democratized usage of those Gen AI services that they put in the market.

And by democratizing, I mean, do I make those services accessible easier for those ISVs? How can I build better tooling for these developers to actually use that technology faster, easier, better? How can I help these also partners to understand how to use GenAI right? Like in this case, industry wise, sub industry wise. And after the specific use case.
So in order to do that, I think you need to approach it based across different areas. You need to, you need to focus on the tech side of it. And they’re probably on the business side of it. There’s always those 2 components and I’ve seen doing that also with previous cutting edge technologies, right? Now is the shiny type of trend, and I think it’s going to stay with us here for multiple years, and beyond.

But as a hyperscaler, you need to first understand, what offer do I create around the technology that is special and unique for the ISV that I care about? And that’s connected to, you know, the, the type of tooling, APIs and, and all of these services that I offer.
Then how do I support my ISV ecosystem within that technology? What are the resources that I’m going to put in place for them trainings, enablements, tech assistance, all of that particular piece that is, you know, developer oriented, and then, of course, thinking of, you know, the programs and incentives, right?

Like, once I have the ISV interest, how are we going to go to market together? What are the attractive incentives around that potential usage of technology, marketing support, access to customer base, all of that, that is more GTM oriented. And it’s also about, fostering that along the way with those ISVs.
You know, how can we collaborate together to integrate the technology? Can we encourage inter-operability, compatibility to get even a better solution together. And, it’s a process, because it also requires continuous feedback, continuous improvement, building long term relationships that might be already established or new ones.
I think you ask about gain more new ISVs, that if you’re starting from a new partnership, it’s more about how do we build that long term relationship to understand business goals and the technology so that all of that is important to nurture for global reach, right?

The offering of global reach – a lot of ISV see hyperscalers as their entry point to geo expansion, right? Which is critical for that in this market. Now you can buy anything across the entire world through marketplaces. So how do we do that together? So it’s that combination. You know, these are becoming 1 billion company. It’s critical for hyperscalers to package to understand very, very well how to partner, with each of them on those 2 fronts, the tech side and the business side. And it’s a matter of like, you know, engagement and support and clarity across that business relationship.

Rajat: Awesome. That’s great. Uh, I think so in a way you define the playbook, for how and what needs to be done to enable the ISVs. And then in the, in the previous question, you touched upon the tri-party. And, if you throw some light on that. Are ISVs are also part of the tri party if you can elaborate a little bit that how you see the tri party things is coming up right now.

Ethel: Absolutely, I think ISVs are looking at partnering with other entities, other partner types to expand their business, right? So when we think about ISVs, they have a solution that might address a specific customer problem, right? But that customer problem might be just a piece of a bigger scope of work that that a specific customer might be looking at.
So you need additional entities like consulting partners or big solution integrators if the scope is bigger or you need to expand that potential solution across multiple geos, then you need a channel partner to do so. So tri-party is a combination of, you know, working with, hyperscalers, and then potentially, on a SaaS offering or an ISV that has their own SaaS offering and then adding another layer of partner value prop on top of that, which is the next step, right?
What else does that the customer need? And this third entity is going to provide that layer. So for the customer, they don’t have to go to maybe like three or four places, or work with three different, entities separately. By bringing all those partners together, it could be tri-party, maybe it’s quad, fourth party, or P2P2P.
Eventually in the future that will be at the best like an integrated partner ecosystem that might be a best solution for the end customer, right? So they don’t have to deal with multiple layers there. So that’s how I see this can also benefit working with hyperscalers and additional partners to it.

Rajat: Oh, it says the recipe is healthy as well as tasty and it seems perfect, but I want to get more specific given the growing significance and the complexities of the channel ecosystem, particularly with estimated at 75% of global trade occurring through channels. How do you perceive it’s role considering the competition and collaboration dynamics among partners and peers, especially in the hyperscaler landscape?

Ethel: Yeah, you touch on a topic that it’s incredibly important for, I would say, any hyperscaler and future partners that are in the growing process or the geo expansion process. There’s no other way to scale. For hyperscalers, ISVs growing, SaaS type of company, but the channel play, right? The way to geo expand, the channel ecosystem plays just a vital role in this global landscape, because it’s a distribution engine, right?
And it’s been there for many years. We already know those companies that we call channel. That has different nomenclatures. Now you can call, you know, MSPs, VARs, LARs, you know, they have involved in multiple dimensions. They’re very, very important. And to your point, I mean, you mentioned 70% they occur through channels.

I actually will add that out of that 75%, 55%, it’s kind of like one tier. Type of like, one tier your channel and close to 20 percent is 2-tier. And when I say 2-tier is like, you actually have distance and even like resellers involved or MSPs involved, which is multidimensional channel. Right? And it adds competition and also collaboration dynamics that are very important to control.
And it’s very important to perceive this complicated scenario in hyperscalers. These channel partners are not new to the cloud. They actually come from, licensing a scenario, on-prem, hardware software models. And they are also at the same time evolving. So they also are creating new business models.

They’re also developing new practices to support this new, partner ecosystem around them that is asking them to help. I want to grow. I need you. So, the channel plays a critical piece for any hyperscaler to grow. It also has different functions, so you might not want to do everything with them.
You might want just to do a piece of your strategy with them, right? They can’t help you on the market expansion and reach. They can also help on diversification or specialization, right? They can also help you acquire new customers, right? Because if they are closer to the customer, especially on the SMB, side, mid market side, they play a fundamental role there.
And you might want to partner with them only on a specific pieces of the distribution line. So, the level of maturity across hyperscale might be different working with the channel. There’s no doubt that. I would assume all hyperscalers have a very robust strategy around that.

Now, I just want to mention a couple of things. There are two fundamental topics to address with those channels. One is also competition. As I mentioned before, they also compete with each other, right? They you’re competing with your own kind of like type of technology partners, but this channel partners compete with each other. So, I need to also make sure that there is a balance, a delicate balance for mutual growth, a strategic alliances. With partners clear, clear collaboration, because this competition is always going to exist. Right? But it’s important to make sure that that collaboration is clear.

And, because the channel ecosystem is going to evolve, and it’s going to keep building a strategic alliances across the board. So that’s important. And then the other one is, for hyperscalers to have their own strategy, right? They might have the partner selection for a specific area. I mean GenAI might have a specific channel partners to use versus industry specific versus technology specific, right? So, I mean, in a nutshell, there are both opportunities and challenges across the channel, and hyperscalers need to navigate them. Not only hyperscalers, but any type of partner that wants to put a solution within the channel.

Rajat: Wow, I think so. When the partners are going to listen to this podcast, they’ll be super excited, as the way you define the playbook. And at the end you touch upon the point on the GTM as well as incentives that are the additional layers. Do you see any new type of innovation in these layers as well? Or do you see it’s going to happen in the in the coming years?

Ethel: Innovation, it’s a constant construct. I would say it’s just the innovation trends. I think multiple, companies are now launching the future trends happening. So, probably a lot of the audience here is looking at what are these big companies saying about what’s coming. But the companies need to keep collaborating on these new areas. I can name a few. I could envision a lot more, collaboration around things like sustainability, right? And it’s coming now more and more stronger than before.
Sustainability play a critical role across any industry, any technology there, you know, different already blueprints defined the optimizations around energy efficiency on data centers, or especially for hyperscalers. They sign up, you know, different agreements to get to specific targets and go around this topic.
And that’s going to influence the channel or partners around that partner channel, any type of partners. Right? So that’s going to be an area that it’s going to keep growing. You touched on Gen AI, but I will even go before to responsible AI. It’s all going to be connected. When you say AI, it’s going to grow in multiple dimensions, and it’s going to establish ethical conversations and standards and frameworks that probably are not even there yet.

And, those frameworks might come from partners that are especially dedicated to that, supported by hyperscalers that might collaborate in the technology and implemented by consulting partners that might learn about that specific topic. And I want to add in, more their strengths.
The constant cyber security, and security and data privacy conversation. I think as they could technology evolve that topic evolve, right? Because more data, more exposure, more measures and, cross cloud services. So another layer that come ups cuts across a lot of things. Then the topic that is close to my heart that I really like is the, AI, VR ecosystems and all everything related to the decentralized Web and Blockchain.

It was just like a topic that I like a lot, that it was a little bit like too early on the game, maybe a few years ago., and it connects with blockchain based solutions and new words that were introduced as the Metaverse, I think, a few years ago, and now it’s. It’s being more established as a web 3.0.
And in essence, it’s about, you know, using that technology again back to what is truly what customers are looking to solve. What are the business problems that these technologies are going to solve? And then partners developing those offerings and solutions to solve those business problems.
So they’re going to stay with us for many years. So I’m sure that we’re all going to be listening more and more about these topics in the future.

Rajat: Beautiful way to structure it and put the different lenses across each of the angles. Thank you about that. And I have my last question for the day until for you, what are two things that will excite you about 2024?

Ethel: Great question. No doubt the constant opportunity that we have out there working with partners. I don’t know if people even thinking about. Only 5% percent off the customers out there, they’re in the Cloud. You know, we have close to 95% of the worldwide customers still on Prem or just running their business, but not in the Cloud. That opportunity. It’s tremendous. So I’m excited about, learning and I’m providing more value added to actually, help those customers move to the Cloud on their business needs.
So that’s one of them. The other one is, this, GenAI trend. It’s actually, becoming really exciting. Especially when you deep dive more on the use cases. It is a game changer. It’s coming really fast and anybody out there will keep an eye on how to effectively incorporate a little bit or a flavor of it on their business.
And it can be, it could be very, very small. It’s okay, but it’s going to unlock. A lot of new possibilities for anybody on any business, so I’m excited to see the implementation of these scenarios as well.

Rajat: Wow, I think so. Both the points are super great one that is definitely a big opportunity and then doing a double clicking that where is the opportunity could be one of the GenAI angles also that you can go after, but this is interesting.
And I think so, this is super interesting discussion. I think you have left us with a lot of great insights as well as the perspectives. Not only did we learn the delicate balance between the competition, the cooperation, and the collaboration amongst the partners and the hyperscalers, we also get a sense of how hyperscalers are ensuring the superior customer experience in the current dynamic business landscape. Thank you. Thank you so much for sharing your perspectives with us, Ethel, today. I truly appreciate that.

Ethel: Thank you. Yeah, it’s been a pleasure and you know, I really enjoy the conversation. Thank you very much for having me here today. Appreciate that. Thanks.

Rajat: Likewise. Great for the audience. Thank you for tuning into this episode.

We’ll be back soon with another leader and another exciting topic. Till then, take care and stay curious. Thank you so much.