Microsoft Canada integrator partners evolving to meet needs of changing AI market

Systems integrators Adastra, Lixar and Shalom, all of whom had a major presence at Microsoft’s recent forum around AI, talked with ChannelBuzz at the event about what they are doing to be successful in the space.

Darren Edery, CEO of Adastra North America

TORONTO – Last week, Microsoft’s Future Now 2019 event at the Beanfield Centre in Toronto focused on the growing salience of artificial intelligence [AI], what Microsoft is doing to further it, and what others are doing to translate its potential into results. ChannelBuzz spoke with three integrators at the event whose AI practises align closely with Microsoft in Canada – closely enough that they were the three headline sponsors of the event. Adastra was the event’s Platinum sponsor while Lixar and Slalom were the two Gold sponsors.  All three companies talked with ChannelBuzz about how they are approaching the opportunities and challenges of AI today, particularly through the lens of their partnerships with Microsoft.

Adastra has an unusual corporate structure with two headquarters – one in the Toronto suburb of Markham, and the other in Prague in the Czech Republic.

“The original company was founded to resell software in the Czech Republic, and it grew a data and analytics business around that which eventually became the business,” said Darren Edery, CEO of Adastra North America. The Canadian and European businesses evolved in a parallel way, and it is now a global business that operates in 40 countries.

Ottawa-headquartered Lixar is a 200-plus person organization, and has expanded to Ottawa, Halifax and Montreal. A foothold in the west is imminent – either Calgary or Saskatchewan.

“We are a 20-year old company, that moved into AI six years ago and have been very successful at it, said Sherif Messiha, Division Manager at Lixar, who used to head up their cloud practice and now, as Manager of Business Development Relations, manages the Microsoft relationship.

The third integrator is the newest in Canada, and the only one headquartered elsewhere. Slalom is a global systems integrator based in Seattle that has a billion-dollar business, and established a Canadian presence in 2015, opening a Toronto office. They have since added offices in Montreal and Vancouver, and have about 350 staff in Canada, around 70 per cent of whom are technology consultants

“We also have a management consulting side,” said Steve Walintschek, CTO and General Manager at Slalom. “We aren’t just a big systems integrator. Consulting firms need that balance to drive digital transformation. ‘Build it and they will come’ doesn’t work in this area.”

That balance between technical and broader skillsets in the digital transformation space was also emphasized by Edery, in his appearance at a panel at the event on innovative talent and the new world of work

“Our focus is on communications,” Edery said. “We valued technical brilliance above all else, but without strong business communication, it can’t manifest itself to its full potential. This has impacted the way we approach hiring.

“We now hire more Ryerson grads than Waterloo grads,” he admitted onstage with some chagrin, as a Waterloo grad.

While most in the industry talk about the gap in technical talent, from Adastra’s perspective, the issue is more complicated than that.

“We think there is sufficient tech talent,” Edery said. “The real gap is technical talent supported by strong business communications.”

The importance of ethics in responsible AI was a theme of the conference. That’s something that partners emphasize as well.

Sherif Messiha, Division Manager at Lixar

“AI ethics is very important for us,” said Lixar’s Messiha. “With autonomous trucks, we still see a truck driver as a pilot. I’d be very concerned about safety with no driver. There is a huge aspect of responsibility there. As a software vendor, we have to be very cautious, and put mechanisms in place to have a backdoor to this.”

Adaptation of the integrators’ practices to capitalize on the new trends around AI, particularly with its move to the cloud, was a central theme.

Adastra has always been in the AI space, although the space itself has evolved since the company was founded in 2000.

“We’ve been doing Big Data and AI from the very beginning,” Edery said. “Originally, it was data warehousing, data mining and predictive analytics. But it was still about building models to make predictions. What has really changed is the computing power. The exponential growth of data was always there, but the increased compute power lets us make much more meaningful insights much more quickly. In the beginning it was embraced very narrowly by technologists and very small areas of business.”

Rob Turner, VP Analytics & Cloud at Adastra

“We weren’t able to do a lot of the work we can now before the increase in computational power,” said Rob Turner, VP Analytics & Cloud at Adastra. “More and more clients have been asking about moving their data warehousing to a highly scalable cloud, and that has become a new practice area for us in the last two and a half years.”

“The cloud isn’t new, but what’s new from an industry trend is that so many cloud organizations used to be resistant to put customer data there,” Edery said. “We are at a tipping point now where that resistance is collapsing.

“The ability now to have an Azure data centre has really intensified this,” Turner added. “It has produced new capabilities around AI, and better customer insights.”

“At Lixar, our core focus now is in AI, around cloud, the Internet of Things, and blockchain,” Messiha said. “The cloud is the focus of our Microsoft relationship.” Blockchain, the newest practice area, does not yet have customers in production environments.

Lixar’s relationship with Microsoft started informally seven years ago and formally three and a half years ago.

“It has been a phenomenal journey,” Messiha stressed. “Their partner focus is a key advantage. They are our top partner because of that focus, and we have accomplished a lot. We have won an IMPACT award three years in a row, and the past year we won two, for Breakthrough Partner of the year and Innovation Partner for Public Sector – and we only started our public sector business two years ago.”

The Microsoft relationship is also central to Slalom, although as a newer company in Canada, they are at an earlier stage in building out the relationship with Microsoft Canada specifically

“Slalom’s very first significant partner was Microsoft, and the business was built on a foundation of a relationship with Microsoft,” Walintschek said. “It was the impetus for growth at Slalom, and since then has evolved into multiple partnerships in different areas. We have a strong brand with Microsoft in the U.S., and are building a more significant relationship in Canada. The company is younger in Canada. In the US, you can grow from market to market, and can build on the brand, but when you show up in Canada, Microsoft in Canada doesn’t know who you are.”

Steve Walintschek, CTO and General Manager at Slalom

These AI solutions are complex, but the enormous speed at which things happen now require them to be implemented quickly, on a schedule that shatters traditional system integrator work processes, Walintschek stressed.

“Everybody needs to move faster, so velocity is a constant topic,” he said. “With large global systems integrators, programs typically take months and years to do. You need to show value, and the period for that has shortened. Customers can no longer wait a year. They want to see something in 6-8 weeks, and that’s the timeline that we work to for an MVP [Minimum Viable Product].

“We have devised a growth formula – an analytically driven process to help clients through this,” Walintschek said. “We have three pillars around it to drive conversations: customer obsession; a focus on teaming; and an insurgent mindset. An insurgent mindset is so important in a high-velocity engagement. The growth formula simplifies how we define the operational framework. That’s why we created and codified it. It’s really about enabling organizations at velocity. How do you help customers go fast, and not be reactive in the world?”

That shorter time frame means more local jobs, specifically jobs in Canada for Canadian customers.

“In a methodology of getting to 6-8 weeks, we have hired tons of engineers in Canada to work with customers in Canada,” Walintschek stated. “Proximity to the client is important. Offshoring things to eastern Europe or south Asia can’t produce the same quality. We don’t offshore. All of the engineering is the same time zone.”

Lixar stresses that digital transformation is a journey, and customers need to keep this forefront.

“You can’t go in and do it all at once,” Messiha noted. “We walk the clients through the process based on experience. It’s our practical experience to build end-to-end enterprise scale solutions. It’s one thing to say, here’s a good vision. It’s another to show how to implement an enterprise scale solution. Developing a business case for the customer helps them latch onto it from a business outcome perspective.”

Messiha also emphasized that Lixar makes significant use of partnerships with other integrators and ISVs.

“For a company that is good at one thing, partnering with another company that focuses on another thing, and a third player which has a software platform is ideal,” he said. “It’s true collaboration that goes beyond one single product.”

That has led to a broadening out of the verticals with which they work. Ironically, while Lixar is Ottawa-headquartered, their federal practice is fairly new.

“We only started working with feds two years ago, but have been extremely successful there, and are one of their selected vendors for AI,” Messiha said. “The majority of our business was in the U.S. when we started, thanks to our founders and their strengths with relationships. It’s still more than half. Bell is one of our biggest clients, and we are strong in telecommunications, airlines, automotive, education, health, government, transportation, oil and gas, and manufacturing.” They are just starting out in two other key verticals, financial services and retail.

“We approach digital transformation from an approach that is very much bottom up,” Adastra’s Edery said. “We are a hammer, so everything is a nail. We think data and analytics is the foundation of – who needs what information where. So we apply best practices around creative and digital design around which decision makers and customers need which information, and build the information to support that.

“The issue with cloud AI data is how do you communicate those insights in a consumable way where you really make them impact,” Edery added. “In the session on financial services, we discussed a trend where we think we are leading. It involves mass scale customization of analytics delivered through mixed media-like videos. Customers see rendered videos personalized for them. We have some fascinating statistics on uptake and conversion rates from data delivered through static channels compared with through video. Video just crushes.”

Adastra is also making increased use of augmented reality.

“It lets us do things like have a clerk see real time information about purchasing trends as they scan a retail store shelf,” Edery said. “We think that health care is the industry that needs AI and augmented reality the most – because the stakes are so high.”