News

Microsoft Readies Partner Program for Influencers

• By Scott Bekker
• March 08, 2007

The U.S. Partner Influencer Revenue Program, launching March 28, will attempt to address an ongoing issue for partners who sell to mid-market and enterprise customers, but who must funnel their deals through Microsoft's small group of Large Account Resellers. Many of those partners have historically had a hard time getting Microsoft's attention even though they drive some major sales.

"The initial intent of the program was to take that influencer information and get it back out to Microsoft's partner-facing people," says Mike Haines, general manager of partner strategy for Microsoft's U.S. Partner Group.

Under the program, Microsoft partners who refer customers to LARs for software fulfillment will provide their Microsoft Partner Program ID number to the participating LAR, who will include it when reporting the deal to Microsoft. Microsoft built a data repository for the information, that will include the partner, the customer, the deal size, products influenced and geographical area.

The main benefit to partners will come when it's time to meet with a Microsoft Partner Account Manager or other Microsoft representatives, Haines says. "When a partner sits down with Microsoft, there's a complete picture of Open License sales plus what they've influenced in enterprise sales," he says. "Now when we do planning, it can be much more tailored to what you do as a partner."

Haines believes the information will help Microsoft make smarter decisions about investing its marketing dollars with partners. Additionally, the information will be shared with the product groups, who would gain greater visibility into which partners are really selling their products.

Software ONE, a New Berlin, Wis.-based LAR, has run a program like Microsoft's Influence Revenue initiative on its own for several years under the name VARassist. The company, which helped develop and test the new Microsoft program, has associated VARs with deals and reported the information to Microsoft through VARassist. Peter Ells, director of strategic alliances at Software ONE, says those VARs who have embraced the approach had their "eyes opened." "They didn't know their PAMs. They never probably met their area sales manager. They had just been left to be kind of floating on the ocean on their own," Ells says.

Software ONE was among the first LARs to participate in the Microsoft pilot that went live between a handful of LARs and some Microsoft Gold Certified partners in November. As of the official launch date March 28, Microsoft expects to have participation from 13 of its 18 U.S.-based LARs. A 14th LAR plans to start participating over the summer, Haines says.

Robert Deshaies, vice president of the U.S. Partner Group, says "From a country standpoint, [March 28] is the big rollout. From a company standpoint, we're really piloting this on behalf of the global community. We're working in conjunction with the Microsoft Worldwide Partner Group, as far as what this will look like in '08."

Darren Bibby, a channel analyst with IDC, says an influence program makes a lot of sense. IBM Corp. already has one for its channel, and Bibby and IDC expect many other vendors to follow suit. "The LARs are not the ones making minds up. It's the trusted advisors, the 25-50 person firm," Bibby says. While the information is incredibly valuable to Microsoft and will help some partners show up on Microsoft's radar, Bibby contends that Microsoft will need to tie concrete benefits to the program to make it worth partners' time.

"Marketing development funds, speaking opportunities, PAMs, being a managed partner or a telemanaged partner -- if all of that had to do with influence points, then I think people would start putting that information in," Bibby says.

Benefits from Microsoft probably shouldn't get too tangible – money can lead to trouble, several observers say. "Let's say someone's selling Exchange to Bank of America. Do you think there's one influencer? If you double count, you double pay," Bibby says.

Ells agrees that financial compensation can lead to more problems than it's worth. "It's not going to be money. They don't want to create a deal-recognition program. If they put too much reward on it, you're going to get those ambulance chasers trying to get the dollars," Ells says.

Haines says Microsoft is looking at introducing concrete benefits in its fiscal year 2008, which starts in July.

Another area Microsoft is looking at is finding a sensible way to include Influence Revenue in the Microsoft PAM compensation model, Deshaies says. In any case, the Influence Revenue data is valuable information for PAMs, he says. "The PAMs are excited. What this is going to do is it's going to drive another level of transparency to really what's happening in their areas. Because there are so many partners, it really is difficult to understand what all the partners are doing. We will definitely include this into the planning aspects of their business as they're working with the partners."