Playing to Win on Microsoft's Turf

Understanding Microsoft's core goal is key to making your relationship work.

I never quite get used to the stunned look on clients' faces when I tell them what Microsoft's core business goal is. It's so simple and painfully obvious that I (almost) feel guilty being paid to point it out.

So hold your face straight while I tell you what Microsoft wants to do, above all else: Sell software. More specifically, sell Microsoft software. Or, as Steve Ballmer would put it (imagine a large, sweaty man screaming and bouncing around on stage): "Software, Software, Software, Software!"

Many Microsoft Partners overlook this fundamental idea, probably due to wishful thinking. In their dreams, Microsoft is backing their product. After approaching Microsoft, the partner envisions a response like, "What a cool idea. How can Microsoft help you?"

I have bad news for the dreamers: Microsoft is not a bank, a venture capitalist, a marketer or a distributor. Microsoft sells software.

The good news: Microsoft does have enviable financial, marketing and distribution resources that are available to partners. If anything, its willingness to share these resources with partners is increasing. But make no mistake: It's all about Microsoft, not you.

So here's how you turn the bad news into good. When you make a pitch to Microsoft, toss a nice, slow lob that it can hit out of the park. Focus your pitch on how your product or service will enhance Microsoft's strategic importance, how it will strengthen Microsoft's competitive position, and, most of all, how it will sell more Microsoft software.

Here are some ways to fatten your pitch:

Target a vertical industry. This is currently Microsoft's favorite partner strategy: piggybacking on your market penetration and expertise. Don't build high-volume, horizontal solutions like Microsoft does. Find new ways for Microsoft to win in markets it doesn't already own.

Good areas of concentration include embedded platforms; vertical solutions that are tightly integrated with SQL Server, Exchange, or SharePoint; anything that makes good use of BizTalk Server; and solutions that make Microsoft rookie players—such as Live Meeting or Live Communications Server—look seasoned. In every case you're giving Microsoft reason to push your product.

Be kind to old players. Microsoft still makes most of its money from the desktop OS and the Office productivity suite. Unfortunately, these stalwarts are getting old. The desktop OS no longer outpaces the PC run-rate—if PC sales slow down, so do desktop OS sales. Office sales have reached market saturation and now rely heavily on renewal of volume licensing agreements or on consumer sales of the less profitable Student and Teacher Edition.

You can win if you give customers new reasons to upgrade to Office 2003 (better yet, Office 12) or to Longhorn. For example, take a hard look at Longhorn technologies like Avalon and Indigo, figure out how you can take advantage of their unique features, and you might have Microsoft begging to showcase your product.

Check out Visual Studio Tools for Office, which brings .NET development to Office, or the Information Bridge Framework, to integrate your app with Office 2003. Microsoft is begging for demos of these development tools in action, particularly if they introduce features that get customers to upgrade Office.

Another big opportunity is the upcoming Small Business Accounting application: Customize it for some specialty retail segment, and you'll be on the ground floor of a major Microsoft marketing effort.

Finally, here's a strategy for those who want to live dangerously:

Solve a problem for Microsoft. Wouldn't it be nice to have simple, reliable, clustering or backup solutions for all Microsoft products? If you solve this or some other problem for Microsoft, you may have a hit on your hands, and Microsoft will be very interested.

The fact is, Microsoft's farm team is already working on most fundamental problems. But great minds don't always think alike. Come up with a ground-breaking solution to a vexing problem, and Microsoft might consider an acquisition or trade—and you'll be doing a victory trot all the way home.

About the Author

Paul DeGroot is principle consultant with Pica Communications, which provides consulting services for customers with complex Microsoft licensing issues.