Stacy Nethercoat, vice president of  Tech Data’s TDCloud division, was in the Toronto area on Wednesday to visit Tech Data Canada’s offices, and took some time to speak with ChannelBuzz about the distributor’s cloud strategy, cloud progress, and how it all rolls out in the Canadian market.

Nethercoat, who has been with the distributor for over two decades and has had multiple senior roles, was appointed president of the  TDCloud division in August 2014. This week’s visit was orchestrated around a key meeting with Microsoft Canada.   Nethercoat also met with the top Tech Data Canada executives and their teams to ensure that their priorities are getting the attention they need, and with other vendors whose key relationships with Tech Data are in Canada.

While Tech Data was a comparative latecomer among the main distributors to the cloud business, their cloud business has taken off significantly in the last couple of years, as every IT vendor of significance has moved to develop a cloud strategy and portfolio. Nethercoat said that when she took over, cloud was about two per cent of Tech Data’s business. These days, it’s about 30 per cent, compared with 70 per cent on the more traditional side.

“Back in the days when Ingram Micro was running their Seismic managed services, and some VARs were transitioning their business to charging a reoccuring service fee, we didn’t clearly see how we would make money from that,” Nethercoat said. “SaaS [software-as-a-service] on the other hand is still a product, even though it’s paid for like a service.”

While it took time to bear fruit, Nethercoat said that Tech Data has been developing a cloud strategy since 2009.

“That’s when we got serious about serious about thinking what we needed to be successful there, which involved the right relationships with the right vendors, having the right sales and technical folks for cloud, how best to enable partners, and how to manage the transactional aspect of it. For what we call the ‘144 effect,’ where we chop an annual sale up into pieces for 1/12 the price each month, you need to be really efficient at managing the load. That led to the development of our StreamOne e-business platform in 2011.” While initially only its software licensing tool was available in Canada, since late 2014, the full platform, including the application store, has been available here.

“We have focused on making sure we had the best of breed on our StreamOne line card,” Nethercoat said. “When we introduced it, many partners had not yet adopted cloud and we identified how Tech Data with our vendors can help them make that transition. That process is still true today as Infrastructure-as-a-Service [IaaS] starts to gain traction in the channel. In the beginning, cloud was apps like security or the core Microsoft apps. Now it’s increasingly IaaS, and our function includes helping partners walk into end users and have conversations about how to make decisions about what to move to the public cloud, or the private cloud, or where they should just modernize hardware.”

Nethercoat says that the unique nature of the cloud business unit at Tech Data provides leveraged benefits to partners in Canada.

“The cloud business unit is our only one that is global,” she said. “We have other global units, but they are shared services like HR and legal.  We are able to  leverage the best of what all geos have to offer.  Our North American strategy is based on high level principles but there are local difference and nuances that have to be respected, like the fact that 98 per cent of Canadian businesses are small businesses. That impacts seat count differences. It means that in Canada we can work with companies that wouldn’t be relevant in the U.S. with its larger seat count.”

The core policies themselves are broad ones, however.

“Whatever we are developing,  whether on the StreamOne platform, or building out post-sales support, which is a new capability we introduced last year, is being done North America-wide and with an eye to Latin America as they develop their capabilities,” Nethercoat said. “With cloud, it’s not a matter of knowing what partners want and popping it  on our web site. It’s more about enablement. We can help them manage their subscriptions and post-sales support.”

“We will be having a global meeting a month from now to share ideas and let things bubble up,” said Irene Buchan, Director of Marketing at Tech Data Canada.

Nethercoat indicated that while VAR use of cloud vendor tools is well advanced in the U.S., their use is less advanced elsewhere. While Europe is the most problematic area, she said the need to better use these is also a message Tech Data Canada is giving partners.

“There are vendors now who have products and tools that aren’t consumed by the end user, but used by partners to help them reduce their costs,” she said. “Partners have developed capabilities themselves, but tools that do things faster save resources.”

“That’s one of those areas we continue to focus on,” Buchan said. “We are in a recruitment mode there, and are resourcing up. The highest priority is to see what partners are requiring.”

While 42 vendors are in the app store today in the U.S., there are 30 in Canada, and Nethercoat said they are very closely aligned.

“Initially we thought we would have thousands of solutions in the store, and we have adjusted that down a lot, to hundreds,” Nethercoat said. “Having a consistent quality partner experience is critical. We  spend a lot of time evaluating, especially potential vendor partners who don’t have deep expertise in working with  partners. I could have 300 backup and disaster recovery vendors if I wanted to. I just don’t want to. What we want is the best of breed to capture X segment of the market. There’s a point where we don’t want to have proliferation.”

“Our role with cloud, even more so than in the past [with traditional distribution] is to be an aggregator,” Buchan said. “It’s important to have easy and efficient delivery. We also have vendors with a cloud strategy, like Avaya, whose solutions aren’t yet available through the solutions store.