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Jessica McDowell - The 2026 Channel Forecast · Partnerships Unraveled

• 0:06
  SPEAKER_00: Welcome back to Partnerships Underworld, the podcast where we underval the mysteries about channels and partnerships on a weekly basis.
• 0:12
  SPEAKER_00: My name is Effa and excited to introduce today's special guest, Jessica.
• 0:16
  SPEAKER_00: Jessica, how are you doing?
• 0:18
  SPEAKER_01: I'm doing great and I'm excited to be here and chatting with you.
• 0:22
  SPEAKER_00: Well, thank you.
• 0:22
  SPEAKER_00: This is the second time you're joining us on the podcast.
• 0:25
  SPEAKER_00: The first episode was amazing.
• 0:26
  SPEAKER_00: And today, uh again, we're going to talk about really interesting stuff.
• 0:29
  SPEAKER_00: You released uh the Direction of Technology Report recently.
• 0:33
  SPEAKER_00: Uh and there were so many interesting insights that I want to dive into today.
• 0:36
  SPEAKER_00: Uh, maybe for those who might not know who you are, Jessica, uh could you give us an introduction, tell us who you are, uh, where you're coming from?
• 0:43
  SPEAKER_01: Yeah, sure.
• 0:43
  SPEAKER_01: So uh Jessica McDowell, I lead our North America marketing and our digital strategy at TD Sinex.
• 0:51
  SPEAKER_01: And so I am responsible for our strategic go-to-market, our partner enablement, and really our marketing efforts in the region.
• 1:00
  SPEAKER_01: And I'm also responsible for our commercial digital adoption strategy.
• 1:05
  SPEAKER_01: And my focus is just to provide better customer experiences through things like increased personalization and digitalization, uh, really working to equip our partners and our coworkers with all the skills and all the tools that they need to succeed in this modern marketing era that we are encroaching upon.
• 1:26
  SPEAKER_01: And and uh I've been at the company for for quite some time.
• 1:29
  SPEAKER_01: And I previously led our security and networking business for the better part of a decade.
• 1:34
  SPEAKER_01: And and there I was responsible for business development and and vendor management uh across those two sectors.
• 1:41
  SPEAKER_00: Awesome.
• 1:42
  SPEAKER_00: For a really strategic person like yourself, Jessica, I want to start with uh with the big picture.
• 1:46
  SPEAKER_00: Yeah, because I saw that in the report that you surveyed over 1,400 partners across 40 different countries.
• 1:53
  SPEAKER_00: From your perspective, what was the most telling signal that 2026 will be uh a different year for the channel?
• 1:59
  SPEAKER_01: Yeah, I think uh one of the most or one of the clearest signals that 2026 is gonna look different is is really that partner growth is is kind of being driven less by what the partners are selling, and it's being driven more by how they operate.
• 2:15
  SPEAKER_01: So we we've released this Direction of Technology report for four years now, and we've always focused heavily on things like portfolio mix and and exploring what technologies partners should prioritize and where they need to place their butts and how do they approach emerging areas like AI.
• 2:33
  SPEAKER_01: And yeah, we looked at all of those things again this year, but what was new this year is that we introduced two new measures.
• 2:40
  SPEAKER_01: So we introduced the Net Growth Index and the Net Optimism Index.
• 2:44
  SPEAKER_01: And this allowed us to better understand not just what technologies are gaining traction, but really how the different types of partners are performing and how they're feeling about the market.
• 2:54
  SPEAKER_01: And when we analyzed the data, what we found was that partners that had service-led business models like your ISVs and your professional services firms, those partners are actually seeing the strongest growth and they were expressed expressing the greatest optimism about 2026.
• 3:12
  SPEAKER_01: And so then you have this contrast where you had partners that are relying primarily on traditional resale models.
• 3:18
  SPEAKER_01: Those partners had moderate confidence about 2026.
• 3:21
  SPEAKER_01: So I think what that tells us is 2026 is it's a bit of a pivot point.
• 3:27
  SPEAKER_01: You know, partners that are truly diversifying beyond that transactional resale and partners that are investing in these services-oriented capabilities, they're going to be better positioned to grow and to outperform the market.
• 3:41
  SPEAKER_01: And for us, that's a great opportunity, right, to help our partners make that transition and really capture what's next together in partnership.
• 3:50
  SPEAKER_00: I'll allow to double-click on that piece because this is also a topic that we've been talking a lot on the podcast.
• 3:56
  SPEAKER_00: The um the increase in managed services.
• 3:59
  SPEAKER_00: I feel like, as you mentioned, right, we've been talking about it for so long, that that alt reselling model has been kind of uh going away.
• 4:07
  SPEAKER_00: And also in the in the report that I saw that 82% of the partners are expanding managed services and 90% plan to offer support and maintenance.
• 4:16
  SPEAKER_00: Why do you think that this service-led model is really pulling ahead?
• 4:19
  SPEAKER_01: I I think it's all about the technology that's it's becoming more complex.
• 4:23
  SPEAKER_01: It's evolving faster than ever.
• 4:26
  SPEAKER_01: And I feel like we say that every year, but it's evolving faster than ever.
• 4:29
  SPEAKER_01: And so I think what you're seeing is these end customers that really just they they need these trusted advisors to help them navigate this technology ecosystem.
• 4:37
  SPEAKER_01: And so these service-led models are really allowing partners to meet that demand that we're seeing.
• 4:43
  SPEAKER_01: Um, the consultative approach, uh, it it does a couple of things.
• 4:48
  SPEAKER_01: It it deepens that customer relationship, which is so important.
• 4:52
  SPEAKER_01: It it helps to create recurring revenue revenue streams, which everybody loves.
• 4:57
  SPEAKER_01: Uh, and then it allows for that shift and engagement from what was historically maybe a one-time transaction to this ongoing value.
• 5:05
  SPEAKER_01: Um, but I would say this.
• 5:07
  SPEAKER_01: I would say that it doesn't, that doesn't necessarily mean that our partners have to be experts in everything.
• 5:13
  SPEAKER_01: Uh, I think that's where you see the benefit of companies like TD Cinex that are coming in and offering the ability to collaborate, the ability to partner, the ability to provide this collection of specialists that allows for that augmentation as the partners scale to meet the demand and the complexity in the market.
• 5:30
  SPEAKER_00: That's the biggest yeah.
• 5:31
  SPEAKER_00: How I see it is basically the demand is driven by the customer side.
• 5:35
  SPEAKER_00: As you mentioned, I think the the landscape is getting too complicated.
• 5:38
  SPEAKER_00: There's so many solutions out there, uh, and they they need uh they need someone to take care of their services.
• 5:44
  SPEAKER_00: And you know, one thing that's also going to continue to make things even more complicated is AI.
• 5:49
  SPEAKER_00: It's also a conversation that's been talked in every boardroom meeting.
• 5:53
  SPEAKER_00: Yes.
• 5:53
  SPEAKER_00: Uh and there was some interesting data on it about uh in the in the report as well.
• 5:57
  SPEAKER_00: I saw that almost 75% of partners say that AI is essential to their future, but adoption is not there yet.
• 6:05
  SPEAKER_00: I saw that only 39% have launched at least one AI solution.
• 6:09
  SPEAKER_00: What do you think is what is holding partners back with AI?
• 6:13
  SPEAKER_01: Yeah, that was one of the biggest, the biggest glaring things that that came out in when I read the report for the first time when we finalized it.
• 6:21
  SPEAKER_01: And I think there's a paradox at play.
• 6:24
  SPEAKER_01: Uh I think when you ask what are what's holding partners back, a couple of things.
• 6:28
  SPEAKER_01: Um one is is managing the end customer expectations and really being able to translate AI into customer-specific business value.
• 6:39
  SPEAKER_01: Um, and I think the other one is just skepticism and AI.
• 6:42
  SPEAKER_01: I think customers, especially at the end-customer level, they're they're having concerns around trust and that, you know, whether that be transparency or accuracy or just the control over the AI-driven outcomes.
• 6:55
  SPEAKER_01: Um, so you you have a those two things in play.
• 6:57
  SPEAKER_01: But also then you you have layered on top of that is this this skills gap, right?
• 7:02
  SPEAKER_01: Um, nearly half of the partners, when we went and surveyed the partners, nearly half of them said they cited talent shortages and they said this is a challenge when we're implementing AI solutions.
• 7:13
  SPEAKER_01: So I think it's it's important for all of us and our partners to kind of remember that customers, they're not buying AI just for it's just for the sake of having AI.
• 7:22
  SPEAKER_01: They're really looking for the outcomes that AI can deliver.
• 7:25
  SPEAKER_01: And so until those outcomes are very clearly defined, very clearly demonstrated, I think that you're gonna see this adoption and ROI, you know, um paradox and and limitation.
• 7:38
  SPEAKER_01: Uh but I still think that the collaboration piece, the collaboration piece is key.
• 7:43
  SPEAKER_01: Um, and it's essential to overcoming these barriers.
• 7:46
  SPEAKER_01: And this is something that we're very focused on at TD Synx.
• 7:49
  SPEAKER_01: We saw it very early out of the gate with AI.
• 7:51
  SPEAKER_01: We created this destination AI framework to really meet the partners where they are on their AI journey.
• 7:57
  SPEAKER_01: We've got hands-on enablement workshops, we've got our um destination AI practice accelerator, we've got game plan, we've got practical tools.
• 8:06
  SPEAKER_01: So we're really surrounding the partners with tools to help them go in and deliver the outcomes and deliver something that's tangible to the end customers.
• 8:15
  SPEAKER_01: But the talent shortage, the skills gap is is it's not getting any the gap is is only widening at this at the rate of acceleration with the technology.
• 8:25
  SPEAKER_00: Yeah, I agree with you.
• 8:26
  SPEAKER_00: I want to talk about the talent shortages, but before I dive into that, uh, you kind of mentioned the importance of the AI driving ROI, right?
• 8:32
  SPEAKER_00: I feel like this is not only a problem in for partners or in the B2B channel, but overall, I feel like we're still in the early days of AI.
• 8:40
  SPEAKER_00: Also, really big companies like Gemini, ChatGPT, they're still like thinking about how we can make this profitable, right?
• 8:45
  SPEAKER_00: AWS, they're still thinking about, okay, we still need to figure out how to make it profitable.
• 8:50
  SPEAKER_00: And I feel like one of the ways, uh one of the areas that is going to be really transformative is cybersecurity.
• 8:56
  SPEAKER_00: I also saw in the in the data that uh almost 60% of partners expect AI-powered cybersecurity security to be the most transformative use case.
• 9:07
  SPEAKER_00: Do you feel like this is the uh the area where you're going to finally see some really strong tangible ROI?
• 9:15
  SPEAKER_01: Yeah, uh well, let me first say that cybersecurity is near and dear to my heart.
• 9:18
  SPEAKER_01: I spent a decade in that business at TD Synx.
• 9:21
  SPEAKER_01: So um I do, I do think that the AI-powered cybersecurity, I do think it's poised to become uh a growth driver for the industry.
• 9:30
  SPEAKER_01: Uh, I think as we're seeing the threats become more sophisticated, the demand for these advanced security solutions that leverage AI capabilities, that's going to increase.
• 9:39
  SPEAKER_01: Um, you've got a huge market opportunity.
• 9:41
  SPEAKER_01: You've got, you know, the five-year Kager is somewhere in the 25 to 30% ballpark.
• 9:46
  SPEAKER_01: So I think this um it does position AI as a critical component for partners that are looking to differentiate themselves in what we see as a very competitive market.
• 9:56
  SPEAKER_01: And I yes, I think cybersecurity may very well be one of the initial areas where AI is able to come and improve, clear our life for the channel.
• 10:05
  SPEAKER_01: Uh, but it's also part of a broader shift, right, to these AI-enabled technologies.
• 10:10
  SPEAKER_01: I think the AI is not a standalone.
• 10:12
  SPEAKER_01: It's not, it's not AI in a silo.
• 10:15
  SPEAKER_01: It's becoming this foundational thing that we're seeing across the entire technology stack.
• 10:20
  SPEAKER_01: And, you know, security was and remains foundational as well.
• 10:25
  SPEAKER_01: So you're seeing, you know, you're seeing those two worlds merge very quickly.
• 10:28
  SPEAKER_01: And so I do think that it's it's it's a great opportunity for growth and ROI on the AI side.
• 10:34
  SPEAKER_00: Yeah, those two words are merging really quickly, and it's kind of making things a bit more complicated.
• 10:39
  SPEAKER_00: And that's why we need smart people uh to you know build those uh programs and manage those programs.
• 10:45
  SPEAKER_00: And as you mentioned, the talent shortages, I feel like is a big problem.
• 10:48
  SPEAKER_00: Always come up in the conversations lately.
• 10:51
  SPEAKER_00: Maybe, maybe the question that I want to ask is uh, how are like high-performing partners, what are they doing differently to overcome this skill shortage problem?
• 11:01
  SPEAKER_00: Like to all the partners that are listening to us, and also it's not only on the partner side, I feel like Van Disney, I think it's on all sides that this is a problem.
• 11:08
  SPEAKER_00: What do you think like the businesses who are kind of high performing in this matter, what are they doing differently?
• 11:14
  SPEAKER_01: They're being intentional.
• 11:15
  SPEAKER_01: They're being very intentional about ecosystem collaboration, they're being very intentional about skills building.
• 11:20
  SPEAKER_01: You it kind of goes back to what I said earlier about you don't have to be an expert in everything.
• 11:25
  SPEAKER_01: Um so it's it's about being intentional and where you want to build your skills, but then also forming partnerships with organizations that do bring deep expertise in some of these strategic areas.
• 11:38
  SPEAKER_01: Um, it allows our partners to expand their offerings, it allows them to move faster, it allows them to stay competitive without being so constrained by talent availability and so constrained by trying to do everything themselves in-house in terms of specialization.
• 11:53
  SPEAKER_01: Um, so I would say that that's certainly one area is the collaboration piece.
• 11:56
  SPEAKER_01: But also it's it's prioritizing training and upskilling.
• 11:59
  SPEAKER_01: You know, the world is changing.
• 12:00
  SPEAKER_01: We have to make time, we have to make time to train, we have to make time to upskill.
• 12:06
  SPEAKER_01: Um, we have to make time for continuous learning.
• 12:08
  SPEAKER_01: And that's, you know, something internally at TD Cenex that we're focused on, you know, always have been, but even more so recently.
• 12:15
  SPEAKER_01: It's this continuous learning, uh, making sure that we're keeping up with the trends, making sure that we're looking 10 steps down the road.
• 12:23
  SPEAKER_01: Uh, and I think that's going to be critically important for partners.
• 12:28
  SPEAKER_00: Yeah, I fully agree with you.
• 12:29
  SPEAKER_00: And one thing that is kind of making me worried, and you know, please let me know if I shouldn't be worried about this, but like the the kind of disappearance of the entry-level job, do you feel like that is because how I view it is like we have you have entry-level jobs that you know they will develop into those people who will like develop into leaders of the futures.
• 12:47
  SPEAKER_00: And I feel like, especially in the last few years, you've really seen that like um going away.
• 12:52
  SPEAKER_00: Do you feel like is this the time to think even more about like training uh our our employees to really grow their skills?
• 13:01
  SPEAKER_00: Because I feel like since we are not going to have a huge cohort of new joiners to the industry, that's what I expect.
• 13:08
  SPEAKER_00: Do you feel like now is the time to even like double down on training?
• 13:11
  SPEAKER_01: Yeah, yeah.
• 13:11
  SPEAKER_01: I so yes, to answer your question, um, but I think that the the definition of what's entry level has changed.
• 13:19
  SPEAKER_01: Uh, you know, I think it's you know it's just evolved uh with with the with technology and and the rate of acceleration.
• 13:27
  SPEAKER_01: Um so so yes, I think that the I think that the inch what was historically an entry-level job description, I do think that's changed.
• 13:35
  SPEAKER_01: I think the bar is is rising.
• 13:36
  SPEAKER_01: And I, you know, it's we we kind of talked about this at our Inspire conference back in the fall.
• 13:41
  SPEAKER_01: Um, one of the comments that was thrown out is that um, you know, even our kids right now, they're being trained and they're learning.
• 13:49
  SPEAKER_01: They're being trained for jobs that don't even exist yet.
• 13:52
  SPEAKER_01: So it's it, I think there's a lot of undone.
• 13:55
  SPEAKER_01: Um, I think there's a lot of uncertainty, but also I think there's so much opportunity.
• 14:00
  SPEAKER_01: Uh so you know, you can't wait.
• 14:03
  SPEAKER_01: You have to you have to get skilled up, you have to train, you have to take every opportunity and every um advantage of training opportunities.
• 14:11
  SPEAKER_00: Yeah, I feel like you know, we all have to be uh, you know, on our best game.
• 14:16
  SPEAKER_00: And I also saw in the report that another reason why we should all be in our best games, I feel like it's getting competitive out there, especially for partners.
• 14:24
  SPEAKER_00: In the report, I saw that 75% of partners view increased market competition as their top challenge.
• 14:32
  SPEAKER_00: How is this kind of the reshaping goal-to-market strategies or partner?
• 14:36
  SPEAKER_00: How will this like reshape how partners are investing into their go-to-market?
• 14:41
  SPEAKER_00: Because also in the beginning of the conversation, you mentioned that uh if if I remember correctly, it's not you know what partners do it, it's how they do it.
• 14:48
  SPEAKER_00: I feel like there's has to be operational excellence that partners have to uh you know really invest in.
• 14:56
  SPEAKER_01: Absolutely.
• 14:57
  SPEAKER_01: Um, I think that that, you know, I think it's table stakes, but I think the table stakes are being elevated, just like those entry-level job descriptions are being elevated.
• 15:06
  SPEAKER_01: I think the bar just keeps, just keeps rising.
• 15:09
  SPEAKER_01: Uh, I think that um partners have to be able to adapt really quickly.
• 15:14
  SPEAKER_01: Um, the the market dynamics are changing, the customer demands are changing, technology advancements are changing, all of those things.
• 15:22
  SPEAKER_01: So the bill the ability to adapt, I think is going to be really important when we talk about the competitive pressure that we're seeing.
• 15:29
  SPEAKER_01: But yes, to answer your question about operational excellence, uh I think that there's a large increase in the need for partners to really digitalize their efforts, to streamline their operations, to enhance that customer engagement, um, to facilitate very efficient service delivery.
• 15:48
  SPEAKER_01: And that, you know, we we launched at TD Sinex, we launched Partner First, which is our unified digital experience platform.
• 15:55
  SPEAKER_01: We launched this last year.
• 15:56
  SPEAKER_01: And it's because we know that partners need to embrace this digital transformation, and we wanted to make this effort easier.
• 16:03
  SPEAKER_01: Um, on the flip side of that, you have this, you have a pure digital model, and then you have a pure human-to-human model.
• 16:12
  SPEAKER_01: And, you know, our partners want different things.
• 16:15
  SPEAKER_01: End customers want different things.
• 16:16
  SPEAKER_01: Some end customers want that strict human-to-human engagement, and some of them um want a purely digital transaction.
• 16:24
  SPEAKER_01: And so we and our partners need to be able to offer both of that.
• 16:28
  SPEAKER_01: So, you know, both options, kind of a hybrid approach.
• 16:31
  SPEAKER_01: And that's what partner does, partner first does for us.
• 16:34
  SPEAKER_01: And that's what we're really encouraging our partners to embrace is how are you going to digitalize your efforts and your engagement with your in-customer community?
• 16:43
  SPEAKER_00: Yeah, yeah.
• 16:43
  SPEAKER_00: I I want to double down on you said, you know, customer, customers want different things.
• 16:47
  SPEAKER_00: And I think nowadays one of the, you know, we talked about managed services, they're more in demand.
• 16:53
  SPEAKER_00: But the other thing that like customers are really looking for is that industry expertise and consultation.
• 16:58
  SPEAKER_00: And actually, in your report, I saw that that was the number one factor and how customers choose a partner rather than pricing or what kind of products that they offer.
• 17:06
  SPEAKER_00: What do you think this signals uh about you know how partners need to show up in the market now?
• 17:11
  SPEAKER_01: Yeah, I a couple of things.
• 17:13
  SPEAKER_01: Um, I think it's it's one of the first things that we talked about, right, was this this shift towards expertise over products.
• 17:22
  SPEAKER_01: I think um the fact that industry expertise and consultation, we saw it emerge on the direction of technology report.
• 17:30
  SPEAKER_01: I think that fact that it's emerging as a top priority for customers, um, it does signal a fundamental shift in how partners have to position themselves in the market.
• 17:39
  SPEAKER_01: Uh, the customers, again, are increasingly looking for these partners who can provide specialized knowledge and insights uh that are that are just their unique challenges, right?
• 17:49
  SPEAKER_01: It's not a one size fits all.
• 17:51
  SPEAKER_01: Everybody's different.
• 17:52
  SPEAKER_01: Um, so that shift towards expertise uh over products, I think, is is you know a huge signal that's showing up in the market right now.
• 18:01
  SPEAKER_01: And I think I think specialization also builds trust.
• 18:04
  SPEAKER_01: So I would say um the ability to build trust is a is another big signal that we're seeing.
• 18:11
  SPEAKER_01: Um and when partners are able to demonstrate deep and specific knowledge in industries or technologies, and and you know, it allows them to provide this tailored solution that the customers are are really looking for.
• 18:25
  SPEAKER_01: Um, but then also I think that you know there's an opportunity to um dive a little bit deeper into vertical solutions.
• 18:32
  SPEAKER_01: So honing in on particular sectors, um, you know, that allows partners to really differentiate themselves from competitors.
• 18:40
  SPEAKER_01: It's about finding that that niche in the market and what are you really, really good at?
• 18:44
  SPEAKER_01: And and you hone in on that and then you leverage your bench and you leverage um, you know, again, you know, companies like TD Cinex that are providing that bench and that staff augmentation to cover to cover the rest.
• 18:57
  unknown: Yeah.
• 18:57
  SPEAKER_00: So is it fair to say that partners who try to sell everything to every kind of customer is not going to be successful in 2026?
• 19:06
  SPEAKER_00: They need to pick a lane and get and really specialize in that.
• 19:10
  SPEAKER_01: I think pick a lane for now and then build on it.
• 19:12
  SPEAKER_01: You know, there's I just I think trying to specialize in everything is gonna is gonna water down some some approach.
• 19:20
  SPEAKER_01: Um, I think some customers, you know, some of our partners have the capacity to go a little bit wider on their specialization, and some, you know, would stand to do very well in honing in a couple of specific areas.
• 19:32
  SPEAKER_00: Yeah, I agree with you.
• 19:34
  SPEAKER_00: But I know some people are listening to the conversation and they think to themselves, well, this is such a value-packed conversation.
• 19:39
  SPEAKER_00: I can listen for hours.
• 19:41
  SPEAKER_00: But the good thing is they can actually access the reports uh and read more in depth.
• 19:45
  SPEAKER_00: Uh, for those who are listening, where can people access this report?
• 19:48
  SPEAKER_01: The best place to go is is tdsinex.com.
• 19:52
  SPEAKER_01: We've got our newsroom there.
• 19:54
  SPEAKER_01: Um, you can go to news.tdsinex.com and you can find the report there.
• 19:58
  SPEAKER_01: But get in touch with With us, tdsinex.com, get in touch with us.
• 20:02
  SPEAKER_01: Um, we have very much a meet partners where they are approach, and uh any any and all questions uh are welcome.
• 20:12
  SPEAKER_00: Amazing.
• 20:12
  SPEAKER_00: I'll also make sure to put a link in the description so you guys can uh just scroll down, click the link, and access the report.
• 20:18
  SPEAKER_00: Well, thank you so much, Jessica, for the great conversation.
• 20:21
  SPEAKER_00: I think it was a super insightful episode.
• 20:23
  SPEAKER_00: Uh, and see you in the next episode.
• 20:24
  SPEAKER_01: Absolutely, thank you.