Q&A with Top Microsoft Channel Exec Phil Sorgen

WEB EXCLUSIVE: Have faith in Microsoft on CRM, give Pinpoint another chance, check out DigitalStride, stay tuned on Surface in the channel and keep an eye on opportunities in Azure, hybrid cloud and EMS, Sorgen advises.

As 2014 wraps up, and the channel gets set for a new year, RCP got on the phone with Microsoft's top worldwide channel executive, Phil Sorgen, for a quick check on what Microsoft is up to and what's in store for 2015. Sorgen, officially the corporate vice president of the Microsoft Worldwide Partner Group, offered insights on changes in best practices for marketing to customers to the continued cautious channel rollout of Surface and many topics in between.

RCP: Some partners are saying they're having more trouble getting customers to come to events than they used to. Sort of the old coffee-and-a-donut approach that used to work pretty well has been drying up. I'm wondering if that's something that you're seeing across the board as feedback from partners and if there's anything that you're changing programmatically or that you advise partners to change about their marketing.

Sorgen: We definitely wouldn't call it the end of the program that people come and show up and participate to learn and create interest, maybe with the donut like you described, but what I will say is we're really enhancing our digital assets to enable partners to do their own marketing and for us to do through-partner marketing that has a digital consumption. Clearly, in the same way that people are adopting the cloud, they're using the cloud for developing, for finding, for trying and for buying in more cases. As a result, that's also true to a certain degree in the enterprise space around exploration of the [different] kinds of solutions.

The uptake on webinars continues to grow. We're [trying formats] for everything from a 50-minute, full-on briefing to more snippets around how to gain interest. For our partners, we stood up something called DigitalStride, which is sort of an agency model for those that don't have the marketing capability, especially those focused on the small and midsize space that may not have a marketing department to help them with the search engine optimization and SEM [search engine marketing] and some of those other capabilities that they may not be able to do themselves.

Every year we have over 275,000 assets downloaded out of the Partner Marketing Center. Those are assets that partners can use for marketing. More of those are becoming digital assets than ever before.

One of the things that we've done in RCP in the past is talk about "hidden gems" -- things that are available to Microsoft partners but that you feel are very successful for the partners who use them, but are not as well-known as they could be. Is there anything that jumps to mind for you? You mentioned DigitalStride, but is there anything else that you wish more partners were taking advantage of because they seem to be working very well for the partners who are?

Thank you, [DigitalStride] would be one that I would highlight. And then the broad utilization of the Partner Marketing Center. I would tell them if they haven't been in Pinpoint lately, they need to go back. It is core to our future and how we will integrate not only our directory -- and now I'm giving you more of a visionary statement. Today, it is a significantly enhanced platform. We just launched Partner Center last week and now we have the Sales Dashboard, Lead Management tool in place, a much improved UI, we're starting to integrate into more of our marketing efforts, so it really is a revamp. It's being developed and is now being enhanced by the same group that did the Commerce Engine. You can envision that over time, it will be both a directory and a place where partners will be able to transact their first-party solutions through our Commerce Engine.

"We're continuing to see great growth in the Cloud OS Network, which really represents the hybrid opportunity, which is a uniquely differentiated position in the market for us and one that our partners are telling us allows them to go leverage the best from us from public cloud."

Phil Sorgen, Corporate Vice President, Microsoft Worldwide Partner Group

That's not all fully enabled, but the first step is update your profile and become familiar with the new platform. We've been getting really positive reviews from the partners that have experienced that and are starting to use it. We've had two major releases of that in the first half of the fiscal year -- one on Sept. 29 and one last week.

The third thing that I'd highlight is taking advantage of the learning paths for readiness across the various role types within a partner. There's much more structure that's available. We've always had a lot of content to enable partners to enhance the skills of their people. Now we're enabling them to do it in a far more structured way by role type that will help them succeed.

Maybe the fourth one would be for our cloud competency partners. Drive down their cost of sale and drive up their Customer Sat [satisfaction] by leveraging Signature Cloud Support when they need it. That's one of the richest benefits in the new cloud competencies. Those that have utilized it are telling us very loudly in a positive way that it has enhanced their satisfaction.

One of the big themes lately has been that partners need to develop some intellectual property. I'm wondering if you have any updated messaging or examples of ways that they should do that or should be thinking about it.

We continue to trickle information. We have a partner profitability site on the Partner Portal. The last big release was the e-book on partner profitability. In the second half of the year, we will be continuing to enhance that, and we'll share more information in multiple modes. It will also coincide with some of the platforms that we've brought to market. I'll put it on two dimensions. On one dimension there's the Cloud Solution Provider program. As that continues to gain acceleration we have Tier 1 partners, we've now named Tier 2 distributors and we're about to go into market more fully with Tier 2. In the second half of our fiscal year, or the first half of 2015, we'll start adding more services beyond just Office 365 and Intune. Each of those really starts enhancing the way partners can create first-party and annuity streams for themselves.

On the other side of it, we're continuing to see great growth in the Cloud OS Network, which really represents the hybrid opportunity, which is a uniquely differentiated position in the market for us and one that our partners are telling us allows them to go leverage the best from us from public cloud where that makes sense, but to enhance that with the private cloud scenarios that they want to bring to market as part of their first-party IP that's rounding out their profitability story.

You had a blog in November blog announcing disti-led commercial programs for Surface in Japan and Hong Kong, as well as some new public sector VARs for the device. You closed that post by talking about work to be done and other opportunities ahead. Can you give partners an idea of what you're thinking about as far as next steps for them to represent Surface?

At this stage, the blog was a pretty complete blog. I don't have anything more to announce. The purpose of the blog, candidly, is to show two things. One, we continue to explore models around the world based on the feedback of our partners and the success of Surface Pro 3. Keeping those two things in sync, we're continuing to look at those. In a very thoughtful way, we're going to continue to advance this channel. We're excited about the opportunity, we are serious about the success, but it needs to be a successful model for both the partners that participate and for Microsoft and ultimately with success delivered to our customers. That will be our guiding light on how we'll look at any further expansion beyond this.

What are the key products that Microsoft partners should be keeping an eye on for 2015?

Based on the numbers we've shared, a lot are very aware of the Office 365 opportunity. I think the two that will continue to gain the most new traction from the number of new partners participating will be Azure, as well as solutions like EMS [Enterprise Mobility Suite], which is really about enhancing their ability to manage mobile devices and do that in a thoughtful way through a cloud implementation.

Maybe on the heels of that you're going to see much more integration work and many more opportunities for more partners that have the right capabilities around client. That's a big bet for us and I don't want there to be any confusion on some of the partners that we've created in the marketplace, because those are important partnerships for our customers. But we're not confused about the opportunity that we have with our CRM product to enable many of partners who may not have been, quote, CRM partners in the past but are doing interesting work with Office 365, understanding workflow or understanding interesting things around BI or SharePoint. They have a tremendous opportunity to drive their own profitability further through CRM Online.

There are a couple of things that differentiate us. One is our ability to give partners the tools to bridge hybrid to cloud, and every customer is on its own journey to the cloud. We can help them get there in a thoughtful, step way, and our partners value that. The second is the cross-sell, up-sell opportunity that our platform represents to them through their partnership with us. CRM Online is just one example. The ability to do SaaS extensions for Office 365 built in Azure is just a simple example of how we're going to knit these opportunities together to allow them to drive greater profitability.

We always think of things in terms of launches or announcements. Every time I get in front of the partner ecosystem -- I was just meeting with our Partner Advisory Council last month -- I just continue to [emphasize] that we are driving three tenets that are a level above anything that we talked about. Since I've been in this role, [the message] my whole team and that we're driving across the company is to keep making it simpler to partner with Microsoft, to keep lowering the cost of partnering with Microsoft and to keep increasing the value. Because if we drive those three tenets consistently, we'll help drive greater profitability. We know we're not perfect, but we use that as the filter for every decision we make. More and more of the decisions -- and it was validated again at the Partner Advisory Council -- both big and small are clearly going through those tenets, and I'm going to keep doing that.