The Partnership Protocol - Our Evolution in Distribution Relationships

At last year’s AHR Expo we had lunch with longtime friend and associate Pat Cronin, of Anam Consulting, LLC. There was no special reason for this other than to get together and catch up. Both Pat and I are JCI alums and have lots of common experiences and contacts so we always look forward to these meetings. Pat had recently launched Anam Consulting and was happy to have Nancy and me as a sounding board for some of his ideas. We’ve always looked at Pat as a trusted mentor and advisor so we were happy to reciprocate. It was during these discussions that we suggested that Pat write some articles for The Gateway that would share his industry and business insights and ideas with our integrator partners, distributors, and users of our S4 Open Appliances.

Pat has now submitted several articles and I’ve read each one with interest. Pat’s last article really got me thinking about how S4 is going to market and what our next steps should be. I have read that article multiple times, each time trying to get to a deeper level of understanding of his message. It’s really uncanny how closely our go to market strategy has tracked to Pat’s recommendations, so I have to believe that he has hit the mark right-on. I can’t wait to see what topic he chooses to tackle next.

I think the only area in which we did something slightly different than Pat’s considerations was S4’s decision to enter the marketplace through direct integrator partner relationships. This was the best way to gain recognition with the integration community. We were doing something drastically different from what had been attempted before in this industry, and certainly different at the scale we were proposing. Our products not only acted as a protocol converter, they automated as much of the integration process as was possible and practical. This is also the point when we realized the importance of creating case studies to showcase both the technical and business problems that our products address. We like to emphasize that our partners’ efforts are what really turn these projects into success stories!

The S4 Open Appliances typically have a very long sales cycle and are almost always a part of a huge retrofit and upgrade project. As such, close coordination and communication with our integration partners has been a must. Fortunately, many times our Appliances are the enabling technology that makes it possible to bid the project.

After successfully making a name for ourselves in the BAS marketplace, we started down a more traditional path of developing new distribution channels. Our first distributors served the Canadian marketplace. We heard a clear message from the marketplace there that the integration community liked the one-stop shopping convenience provided by distributors, and were very loyal to those they worked with. It was through this experience that we realized that it indeed was all about relationships, and from Day One our integrator and distributor agreements have not had volume commitments. However, we do expect that our partners and distribution channels are serious about developing a portion of their business around our technology. We also expect them to provide pre-sales engineering and planning and engineering support, post-sale level one technology support, and product training for their dealers and integration partners.

From here we added formal relationships with several of the major players in the BAS marketplace including Honeywell, Trane, and Schneider Electric. These relationships have been very effective at helping us to reach and serve markets that we would have not otherwise have been able to address. At the same time we made sure that we established working relationships with everyone in the BAS industry. We have just about every manufacturers’ Operator Workstation, and many global controllers in our test lab for use in performing regression testing our products as we release new features. We also participate in the BACnet PlugFest every year. This establishes a relationship of mutual respect and an environment where we always work together for the benefit of our mutual customers.

Pat posed the question of where do complex control systems reside in your distributor’s mind. Last week, I had a discussion with a potential new distributor that really brought this topic into focus. In March of 2015, S4 became a Preferred Supplier to the Controls Group North America (CGNA) organization. We have been going through the process of introducing ourselves to each of the CGNA Member Companies and exploring where there are business synergies. One of those potential S4 partners listened to my pitch and then asked “How is S4 Sustainable?” I was prepared to answer that partly because of the seeds that Pat’s discussion had planted. I responded “The S4 Appliances are not a commodity sale, and they are usually sold as a part of a much larger project. Despite the typically long sales cycle, they are products that are a key component of the solution for complex integration projects. I don’t expect that any S4 partner will build their entire business around our products. But, we fill a critical need for cost effectively addressing the retrofit and upgrade marketplace.” I really suspect that you will be seeing an announcement in the near future that this CGNA Member Company has become a S4 Distributor.

Another concept that Pat brought forth was the Voice of the Customer. S4 lives by this advice. You only need to read the article “Device Templates – Beauty and the Beast” in this issue of The Gateway to see how critical this is to our success. If I had to point to one reason that S4 has become the go-to organization for sophisticated integration solutions for the BAS marketplace, this would be it.

Pat, thanks again for your contributions and insights. We look forward to many more articles in the future.

We encourage all of our partners to submit articles, case studies, or testimonials for publication on The S4 Group web site and in The Gateway. By working together we grow together. Please contact Nancy with any ideas you have for submittals.