In-Depth

Marching Orders 2013: 11 Things Microsoft Partners Need To Do in the New Year

Channel luminaries offer their best advice to help Microsoft partners succeed in the coming year.

• By Redmond Channel Partner magazine staff
• January 04, 2013

What are the most important things for Microsoft partners to focus on in 2013? We asked a panel of channel experts for top tips. Collected here are best practices from sales consultants, marketing consultants, industry analysts, Microsoft executives and partners.

As we head into 2013, I see two huge opportunities for partners in the Microsoft ecosystem. The first, of course, is the cloud.

Partners have heard me talk for the last two years about the cloud opportunity, but in the last year we have really seen the traction and scale take off. In 2013 we're going to start to see the trend of cloud leading on-premises. This will be the year that cloud run-rate of certain workloads will pass on-premises in key segments. Look for this leapfrog in e-mail in small to midsize business (SMB), CRM in midmarket, and others. The cloud momentum will undoubtedly accelerate as we release the next version of Windows Azure, Dynamics CRM Online and Windows Intune, and because Office 365 will have a truly symmetric server model.

If you haven't thought strategically about expanding your business into the cloud, the time is now. The current online opportunities for partners are some of the biggest we've ever seen. The various business models we offer partners in the cloud give a clear path to profit that suits your company (think Office 365 Open). The key for partners already in the middle of this transition will be their ability to continue to differentiate their businesses and look for ways to become more of a managed services provider (MSP). To do this will mean adding your own IP to that of core services provided by platform companies such as Microsoft. We're supporting this trend with new managed code capabilities inside SharePoint Online and the fact that you can both customize Office 365 and do sophisticated integration and cross-system customization with Windows Azure.

The second major opportunity I see in 2013 is especially relevant to our OEM and App Dev partners: I believe 2013 will be the year of the touchscreen. Driven by Windows 8, which really shines on a touchscreen, we expect to see touch devices continue to grow in popularity and function this year across enterprise, corporate, SMBs and consumers. Take advantage of the opportunity that the proliferation of touchscreen devices creates. We've evolved our Desktop competency to orient around Devices and Deployment. With this evolution, we're better able to reward partners that help customers select, configure and manage a range of devices.

Together in 2013, we're more ready than ever to bring the new era to life for our customers. Let's go win some business.

As a partner, looking at 2013, I believe you must also look toward 2014. As business models and margins change, business strategies and the future are critical issues to consider. In our strategic planning meetings we stress knowing the dynamics of the marketplace, assessment of your current or future vendor offerings and the status/resources of the partner's organization.

One, our recommendation for Microsoft partners at this time of year is to fully understand any "research or trend" reports for validity to your business model or to know how the data was created and by whom. What was the real purpose behind the report? To sell their opinion, or to provide real insight? We've seen organizations base their business model on false information.

Second, moving with the herd may or may not be what makes you successful. It may be time to reinvent your business -- but recognize this takes longer than most everyone anticipates, and planning the exact steps is critical.

Third, having a longer-term vision is important. We recommend setting revenue goals for a rolling eight-quarter basis with preplanned quarterly tactics that are designed to achieve your goals. Then, quarterly, organize review meetings with your team to see if your assumptions and plans were correct or if you executed effectively.

Hint: Make on-site visits to at least three, maybe four, non-competitive partners during the coming year. These partners should be larger than you are. Bring several members of your team with you during the on-site meetings and make sure there's a clear agenda with specific topics to explore. Learn from those that have achieved what you want to do, validate their service/delivery organizations, how their sales team is managed, how CRM is implemented and understand employee policies. Be prepared to share your organization's strengths and weaknesses as well.

In 2012, I saw too many solution providers trying to do too much, which led to stagnation and frustration, and often left them with the feeling that they were pushing a wet noodle uphill (it doesn't go far). Their businesses didn't move as quickly forward as did the frenetic pace of technology. In 2013, I'm afraid technology will keep moving quickly, but I recommend that solution providers slow down and simplify. This sounds contrarian, but hear me out, as this basic notion will actually allow you to leapfrog competition that might still be trying to push that wet noodle uphill.

Let's get simple with a simple story. Earlier last year, my son came up with a neat idea for collecting "unclaimed" golf clubs, cleaning them up and then donating them to organizations such as The First Tee. As soon as he came up with the idea, he immediately (as often kids and adults will do) started projecting all of the potential roadblocks, tasks and other items necessary to get the initiative off the ground. He then suffered "paralysis by analysis," and guess what happened? Nothing. Great idea, but nothing happened because he complicated the entire thing.

When it comes to solution providers in 2013, don't complicate the matter. Simplify everything, which often requires you to retrench and focus on core areas. Most of you added (or are in the process of adding) mobility and cloud to your portfolios. You're brilliant at technology but get caught up in the same thing that my son did -- projecting the "what ifs." Don't "project" anything, but rather simplify your thinking around specific tactics in your sales, operations and marketing. Here are three things you should do to keep things simple in 2013:

• Industry data is all fine and dandy, but data doesn't move your business -- it's what you do with the data and the tactical plans around it. Focus more on tactics in 2013.
  
  
• For sales, just make your sales processes simple. Don't overcomplicate things. The best companies have simple sales processes so that their sales people can simply execute! Cloud and mobility in particular require this.
  
  
• In terms of marketing, people keep trying all these tricks in an effort to find the "magic sauce" that will bring the dump truck full of leads to their door. Simply commit to being consistent with your marketing in 2013. Those providers that have excelled for the past 20 years have been the ones who've been simply consistent and persistent. That's my simple advice. Oh, by the way, my son simplified and started on some basic tasks and, yes, got his initiative off the ground!

What if you only worked with clients that paid on time, respected your employees, included you in their strategic planning and recommended your company to others? Impossible? Worth a try?

It's understandable during tough times that you grab onto every project for dear life -- not knowing when another one will come your way. But now that the economy is on the upswing you have the opportunity to change the course of your company forever.

First, you need to figure out who your "right" customers are. Not just the ones with the highest sales last year ... dig deeper. Look at the projects that you've completed in the past couple of years. Analyze your data to find your most profitable customers.

From that set, which customers trust you to give them a fair price, call your employees for advice, offer to provide references? Those are the right customers: the customers who will build your business. Identify their common attributes -- industry, company size, department, roles -- and you have defined the people and the companies who will benefit the most from your services.

Whether you call them buyer personas, buyer profiles or something else, articulating the characteristics that define your best customers also defines your best prospects. Concentrate all your sales and marketing efforts on attracting that limited set of prospects.

In all aspects of your business, a well-defined prospect profile will improve quality. Service packages that both your customers and prospects will find valuable. Marketing messages written for real people. Salespeople who understand the prospect's problem without explanation.

Decide who you want to do business with and focus on them. You will be happier, your clients will be happier, your employees will be happier. All will be right with your business.

Next Page: 5-8

It looks like this could be a year of opportunity for Microsoft partners. What with a new, huge revision cycle that includes Windows 8, Office 2013, Exchange 2013, SharePoint 2013, the new Surface tablet and Lync, there's a lot to crow about.

I can't remember a year in which Microsoft has unleashed such a barrage of new and updated technologies. Some might argue that this onslaught is a wee bit too much to thrust upon the market all at once. Time will tell, but for the moment I think this spells opportunity -- as change often does in IT -- for those partners that have positioned themselves to take advantage of this bounty.

Revision cycles are when corporate clients take the time to reevaluate their technology configurations. Given the volume and variety of what Microsoft is introducing, corporate clients are going to need -- more than ever -- their IT services partners to help them figure out what's right for their businesses. For corporate executives it's the logical time to consider on-premises or off-premises cloud options, for example; to further their move into mobility; or to consider the new applications made more viable with these new technologies.

For the partner community, particularly for those IT services companies that specialize in vertical and technology niches, as I've long preached, you're going to be in high demand. But only if you're able to demonstrate that you and you alone have the requisite expertise to sift through this abundance, identify the best options, and then help your clients translate and implement the right solutions.

On the flip side, this era of abundance may also be the death knell era for the generalist IT services companies that think that they can do it all. We may well see a year in which the stronger, well-positioned IT services companies prosper and the less-well-endowed falter and die. It could be a shakeout year.

In this new exciting era with the product launch wave -- the biggest in our company's history -- it's imperative that our partners educate themselves and their customers on the benefits of these product offerings.

I want our partners to be able to approach sales opportunities with a high degree of comfort, fluency and credibility to take full advantage of revenue potential. As such, Microsoft needs to provide its partners with a roadmap, allowing each of these organizations to forge ahead and blaze a trail of individualized success.

A few areas each partner needs to look at, and ensure are part of their business model, include:

• Cloud computing: For our partners to evolve and grow, success hinges on our ability to lead the channel through a new way of doing business with the advent of cloud computing. Partners can truly understand the power of the cloud through resources available to them, such as the Microsoft white paper, "Cloud Computing: What IT Professionals Need to Know" (.DOC)
  
  
• Certifications: New sales and services models are emerging, which also means we have to retrain our existing staff and hire new talent. This is critical to ensure our partners have the capacity, capability, and commitment to deploy and deliver the right solutions for customers and help them move to the cloud on their terms. This is a great opportunity for our partners to refresh their existing talent through training and certifications.
  
  
• Diversity: Diversity isn't only about race or gender anymore -- it's about acknowledging the differences that make people unique. This allows companies to have fresh perspectives to innovate and solve problems. Today, successful businesses require an accepting environment where the best and brightest minds -- employees with varied perspectives, skills and experiences -- work together to deliver solutions that work across multiple devices.

I will continue to encourage our partners to engage closely with us as we embrace the opportunity with the new products in the market; think deeply about sales and technical capabilities by building a strong employee pipeline; and actively recruit and hire top talent from diverse backgrounds.

Together we will create the positive change needed for the channel to continue to evolve and grow.

Business partners of the future must continually reinvent their businesses. Otherwise, they'll find themselves left behind as the "supplier" of technology versus the trusted partner that guides clients to where they need to be. Helping businesses focus on growth and enabling new and different customer experiences is where businesses are spending their IT dollars.

This is being driven by what Gartner calls the "Nexus of Forces" (see gartner.com/webinars), the explosion in information, social, cloud and mobility, as well as the intersection of these rapidly evolving capabilities. These are disruptive technologies that fundamentally change business processes, business strategies and business models, and they're coming at us faster than ever. This is creating unprecedented uncertainty and opportunity for the IT channel as a whole.

There is a catch, however. To tap into the true power of this next generation of solutions, partners need to focus on business processes, IT services, software development and creating unique offerings, which are focused on business outcomes and not just "reselling someone else's technology." Selling outside of IT (sales, marketing, supply chain and finance) will become a requirement. Building a sales organization that can speak to business unit owners should be a priority (if it isn't already). Expanding your (vendor) partnerships beyond the usual suspects must align more appropriately to your long-term goals; otherwise, you'll find yourself selling what people are no longer buying.

No one channel company can go at it alone anymore. Indeed, organizations unable to collaborate -- those that cannot effectively manage the kinds of partnerships that encourage innovation, and direct that innovation toward new strategic capabilities and business growth -- will find themselves at a severe disadvantage.

For some years, many CIOs, IT managers and business owners have seen their channel partners -- integrators, vendors, outsourcers -- as a way to perform standard processes at less cost while their internal IT organization strategically guides the businesses use of technology. Now, however, these very same partners (read: you) have an opportunity to become a source of innovation -- and often the only way complex solutions can be delivered and managed in a fast-moving "hybrid" world.

So, the question is, in 2013 will you be one of those partners that's mapping out your own course, enabling innovative IT solutions that help your clients harness the power of information, social, mobile and cloud technologies? Or will you be the partner that's waiting for your vendor partners to tell you what you should be selling and how much money you can make doing it?

The New Year brings a new era of opportunity for partners working with SMBs. New levels of innovation in the cloud, new form factors and ways of interfacing with PCs, and the accessibility of virtualization solutions are transforming the way SMBs run their businesses, let alone their IT infrastructures. Among the biggest areas of opportunity:

• True momentum in cloud. Cloud remains chief among the opportunities for partners to transform their business for the future. According to IDC, 60 percent of SMBs say the cloud plays a critical role in giving them an advantage over competitors by providing access to enterprise-grade technology. SMBs demand flexibility, security and scalability, and the cloud is the affordable answer. By the end of this fiscal year, we project nearly 2 million seats of Office 365 will be sold in SMBs -- a true testament to the investment SMB partners are making in cloud. To build upon this success, we will continue to provide a variety of offerings to meet your business needs, and the needs of our mutual customers.
  
  
• Innovation and growth projections in hardware. Growth projections for PC and tablet sales next year are higher for the United States -- at 23 percent -- than for anywhere else in the world. If history repeats itself, they could actually be much higher than that. When Microsoft released Windows 7 three years ago, IDC at that time had forecast a PC growth rate of only 3 percent that fiscal year, and the market actually grew at 16 percent. At the same time, we're seeing tremendous innovation from our OEM partners, who are delivering new form factors and making natural UI a productive reality in the PC environment. We've entered a new era where business people can have a cohesive experience across all of their devices, and actually be productive whether working on a PC, tablet or smartphone. All of this adds up to a host of new scenarios being unlocked for SMB customers. For example, the combination of mobility, touch and the new level of productivity now delivered on tablet devices makes tasks such as point-of-sale presentations easier and, frankly, cooler than ever before. Partners should explore these new scenarios with their SMB customers to help them realize the full potential of what they can accomplish in this new era.
  
  
• Accessibility, affordability and demand for virtualization among SMBs. More than 70 percent of midmarket companies are currently virtualizing some servers, and roughly one-third of small businesses cite virtualization as their largest area of IT investment, with disaster preparedness specifically in mind. As the Northeastern United States continues to rebuild following Hurricane Sandy, disaster preparedness is top-of-mind as an imperative for SMBs, which arguably have more to lose than large enterprises when disaster threatens their ability to operate. The availability of Windows Server 2012 in SMB SKUs that include Hyper-V Replica make now a perfect time for partners to engage SMB customers around enterprise-caliber disaster recovery solutions and affordable IT scalability.

Visit the Ready-to-Go Marketing portal to learn more about marketing to SMB customers.

Next Page: 9-11

Who ordered this tepid recovery, anyway? Several years ago, when the economy was "resetting," I made forward-looking statements that the downturn was going to align closer to a normal recession, not the "Great Recession" others predicted. Bottom line is that they were closer to right than I was.

While the slowly improving economic data inspires optimism in me and others, a common current refrain is that we've never worked so hard for so little. True -- the past few years have made us all more focused and efficient. But you're not alone if you're getting tired of this recession too!

Our predictions at SMB Nation are:

• Positive hardware growth. While major research entities and some hardware manufacturers are predicting flat PC/laptop/server sales at best (some forecasts even predict a slight decline), we believe there will be net-net positive growth for hardware for several reasons:
  • The U.S. elections are completed, leading to certainty in the business community.
  • Expectations that fundamental growth is sound in the economy.
  • The Windows 8 launch should yield growth benefits in the second half of 2013 (even though we're not seeing an order backlog today).
    
    
• Deferred refresh cycle. Many SMBs have extended the useful life of their IT assets and must now refresh. They have the fiscal confidence to refresh. This will exceed expectations.
  
  
• Innovation excitement. There's a natural excitement with new technologies and with the mainstream acceptance of cloud computing (finally) in 2013 that will create both budgeted and impulse buys in the SMB community.

Slalom is embracing opportunities in the cloud to drive deeper engagements and long-lasting partnerships with our clients. We've seen great success by first seeking to understand a company's unique business needs, and then developing a tailored solution that delivers ongoing value after implementation.

That's important because the explosion in adoption of cloud technologies from Microsoft -- such as Windows Azure and Office 365 -- means partners have even more tools to create a strong breadth of offerings for their clients. Many of the Microsoft tools work with cloud solutions from companies such as Amazon.com Inc. as well, expanding the opportunities. But gaining long-term business value is often a real challenge.

If you're not already, consider your client interactions as business consultations -- not just technology implementations. Slalom focuses on offering unique solutions and truly becoming a client's business partner. We also believe that strong relationships with cloud providers, anticipating change, and adapting business models to provide customized offerings are crucial.

The reality is that clients can choose from many partners to help them move to the cloud. By effectively communicating both the immediate benefits and long-term business value to your clients and guiding them through the transition process, partners can achieve great success through their cloud offerings.

Integrator. That's what most of us have called ourselves for the last three decades. What do integrators do? They take hardware from various manufacturers and software from various publishers and combine them to create superior customer solutions. A proud heritage.

Over the past few years, some enterprising technologists realized they could create some of the services we used to install at customer sites and produce them more effectively in their own datacenter. Not only that, but by selling these services to a large number of customers they could achieve an economy of scale that would deliver better service at a lower price, and they would still make money doing so.

So now integrators combine hardware, software and these services delivered from remote datacenters into superior customer solutions, and save our customers money in the process.

We call these services cloud services.

If there's one thing I'd like to see channel partners do this year it would be to strike the word "cloud" from their vocabulary -- or at least stop buying into the idea that there's something mystical or magical going on here. Leverage the cloud hype if you must, but don't buy into it. They're just remotely delivered services that can be delivered more cost-effectively that way. That's all.

That is, of course, unless they fall under the new Microsoft redefinition of "private cloud" services, which we'll probably spend the next two years being confused about. Simply stated, Microsoft has chosen to use the National Institute of Standards & Technology (NIST) definition of cloud computing to differentiate "cloud" servers from plain-old servers by adding things like pooled resources, self-service portals, elasticity and a "layer of abstraction" between the user and the underlying technology. I thought we always wanted those things.

This year, let's return to talking like adults about our customers' networks and just leave the word "cloud" out of it. Then watch their FUD go thud.