Microsoft believes its SKU program for packaging services will see a payoff in three years. One down, two to go ...
- By Scott Bekker
- September 01, 2006
Microsoft's "SKU" program for packaging services offerings
is progressing more slowly than planned, but the company remains committed
to the idea and has a three-year strategy to develop the offerings and
hand them over to partners.
SKU is the standard abbreviation for "stock-keeping unit."
Microsoft uses SKU as the name for this program to convey the idea of
a consulting service package so dialed-down that it can be purchased off
a price list.
Rick Devenuti, Microsoft senior vice president for Services & IT,
introduced the SKU concept at the Worldwide Partner Conference (WWPC)
in 2005. He talked about plans to take the repeatable intellectual property
Microsoft develops in consulting engagements and package that with partner
training that would allow partners to deliver the Microsoft-branded service
themselves. Part of the attraction of the idea is taking the consulting
IP gained in high-end enterprise engagements and making it available to
"Frankly, it's been harder than we thought to put these SKUs together,"
Devenuti said in an update on the program during his WWPC keynote this
Asked later to specifically define the challenges, Devenuti replied:
"I always am really optimistic about how quickly we can do things.
I don't think I personally put enough definition in what we were trying
to do. The SKU program takes great projects that have been done and really
crystallizes what is repeatable. Any good solution is going to be customized.
What's really difficult is taking that piece of IP and figuring out what
will work everywhere. That has been what has been more difficult."
"Frankly, it's been
harder than we thought to put these SKUs together."
-- Rick Devenuti, Microsoft Senior Vice President, Services
Other challenges include managing the IP, creating the new licensing
models and defining how the business relationship between Microsoft and
the partners will work.
Devenuti has a three-year plan to develop SKUs into a more substantial
offering: "We're still investing and we've still got lots to learn
in this area, but I'm convinced it's the right way for us to move forward."
IDC analyst Darren Bibby says the SKU program sounds like an interesting
idea, but wouldn't be surprised if it continues to be a tough sell.
"I think this is perhaps a part of business that's more relationship-driven.
It needs people. Trying to package it up might be tough for medium or
smaller enterprises to take," Bibby says, adding: "Maybe the
packages aren't resonating yet."
Scott Bekker is editor in chief of Redmond Channel Partner magazine.