A FORRESTER TOTAL ECONOMIC IMPACT STUDY The Partner Opportunity For Red Hat Ansible Automation Platform A Total Economic Impact™Partner Opportunity Analysis NOVEMBER 2022
“There is a lot of space to deliver professional services because the tool is powerful, and when the tool is powerful, it needs professional services to be correctly used. That’s what we're doing.” —General manager and cofounder, VAR
4 Key Findings Key Metrics Red Hat Ansible Automation Platform provides the necessary tools and certified collections to build, deploy, and manage end-to-end automation at enterprise scale. Red Hat partners are an important component of the overall Red Hat Ansible Automation Platform value proposition, including partner-created and certified collections co-supported by Red Hat and its partners. Each revenue stream is a way for partners to increase their revenues and profitability. For example, for every $100 in Red Hat Ansible Automation Platform subscription revenue, the total additional opportunity is $160 in project work, $250 in follow-on project work, and $50 in managed services. Increased revenues: 4.6x YOY increased number of deals: 40% For every $1.00 in subscription revenues, partners can make an additional $4.60 by providing value-add services. Interviewees reported closing more deals as automation adoption grew and Red Hat Ansible Automation Platform was seen as a leader.
5 Methodology Partner Interviewees FINANCIAL MODEL FRAMEWORK Constructed a financial model representative of the interviews using the TEI methodology and risk-adjusted the financial model based on issues and concerns of the interviewed organizations. COMPOSITE ORGANIZATIONS Designed a composite partner organization based on characteristics of the interviewees’ organizations. PARTNER INTERVIEWS Interviewed 14 representatives at 10 partner organizations with existing Red Hat Ansible Automation Platform practices to obtain data with respect to costs, benefits, and risks. Role Partner Type(s) Headquarters Employees Revenue Head of Red Hat and open-source division Systems integrator (SI) Europe 3,500 $500 million Solution leader Value-added reseller (VAR) Europe 13,500 $7.7 billion • General manager • Account manager VAR Latin America 50 $50 million Director Global systems integrator (GSI)/managed service provider (MSP) North America 90,000 $18.5 billion Senior strategic business development manager Independent software vendor (ISV) North America 3,600 $2.7 billion General manager and cofounder VAR Europe 25 $9 million • Business development manager • Automation practice lead VAR North America 7,000 $14 billion GM, DevSecOps business ISV North America 2,400 $500 million • Director vendor management • Principal solutions architect Distributor North America, Asia Pacific division >25,000 $50 billion • Sales director • Business development executive VAR Latin America 50 $2.5 million
Selecting The Right Partner Program Partners emphasized several reasons why they chose to work with Red Hat Ansible Automation Platform. Red Hat Ansible Automation Platform’s market leadership. Red Hat Ansible Automation Platform’s technology capabilities. “We selected Ansible as our primary tool at the start of our journey [offering network and security automation services] because it’s extremely effective for delivering network change, and it was where a lot of our customer interest was.” —Solution leader, VAR Customer interest in adopting Red Hat Ansible Automation Platform. Preexisting relationship with Red Hat.
“It’s such a hot market, and Ansible is the leader. From a business perspective, we are flooded continually with opportunities.” —Automation practice lead, VAR Every $1.00 in subscription revenue creates a $4.60 opportunity for value-add services. From a gross margin perspective, the value-add services opportunity is 5.9x the subscriptions.
8 Key Findings Key Metrics 90% In addition to services, partners are also building and selling technology solutions that are included or integrated with Red Hat Ansible Automation Platform. The ISV Opportunity Likelihood of expanding software adoption beyond initial use cases. 90% ISV subscription opportunity compared to Red Hat Automation Platform subscriptions. 10x “I see a considerably shorter POV [proof of value] cycle. The customer could try it and see it works in a few hours, versus having to put a large effort into it. It gives me better productivity out of the sales force because it's a quicker win.” —GM DevSecOps business, ISV
9 Methodology Partner Interviewees “The approach we’ve taken is to transform our team of network experts to be automation engineers. We’re on the right track supplying those skills and capabilities. The fact that they’re extremely scarce means we could get away with charging more.” —Solution leader, VAR Investments And Best Practices Partners are investing in areas they consider to be best practices to drive success. Talent acquisition and hiring. Training. Partnership management. Research and development. Sales and marketing.
“We’re going to turn this capability from where we’re doing two or three automation engagements with customers a year to a point where most of our customers are not only thinking about it, but they’re also doing something about it. It’s building momentum.” —Solution leader, VAR
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