The Changing Channel

What Microsoft Partners Are Grumbling About

Howard asked partners what their biggest grievances are with Microsoft. They were more than willing to share.

• By Howard M. Cohen
• July 26, 2016

It's been an interesting few months since this publication ran my 2016 Marching Orders for partners. In that column I recommended that partners treat Microsoft with the same benign neglect it has shown them for the last few years.

Almost immediately, Kati Quigley, senior director of Partner Community Marketing at Microsoft, asked me to gather and provide more detailed input so she could address those concerns.

Subsequently, I reached out to all of the same 500 or so Microsoft partners I consulted originally, asking for more detail. This time, they were much more forthcoming.

Nikkia Carter, CEO of Carter-McGowan Services, reports that she's been "busting my hump trying to get seats only for the plan to be changed to consumption with no warning, which renders more than half of my seats sold as meaningless in Microsoft eyes."

Heartland Tech Groups (HTG) Founder and Partner Arlin Sorensen focused much more specifically on the segment he believes has been hurt the most. "Bottom line is that from where I sit, Microsoft has basically turned away from the SMB channel yet again -- at least in terms of support. We represent over $1 billion of SMB channel revenue now working with over 500 SMB partners, and to have no interaction with Microsoft blows my mind."

IT Innovators' Dave Seibert adds, "Microsoft turned its focus away from many partners when it dismantled programs like TS2, Microsoft Across America, MSTS, SBS, SBSC, TechNet, etc. Partners absolutely responded to that by also turning their loyalty/focus elsewhere."

One longtime Microsoft partner was very detailed about what he feels has been mistakenly changed by Microsoft over the past few years, listing:

• The Partner Account Manager (PAM) role is effectively gone.
  
  
• Microsoft field sellers and management are doing more on their own or through as few partners as possible to minimize their effort.
  
  
• Marketing incentives aren't tuned for systems integration partners.
  
  
• Microsoft increasingly advocates for partners to change their business models with very little understanding of and even less experience in managing partner businesses.

This partner closed with a statement that echoed many of the things I heard: "While I care deeply and believe in Microsoft's product direction, I just don't care about the Microsoft field and marketing team any longer. I like to listen to what they are doing, but I value them giving me things and leaving me alone. There's no way I'm going to share anything from my business with Microsoft, as I feel like they're a competitor."

MJ Shoer, CTO at Internet & Telephone and former chairman of the board of CompTIA, focused on the competitive issue, saying, "The biggest issue is preserving our margin opportunity, especially with the new Cloud Solution Provider model, where Microsoft is essentially setting our sales prices, but we have little control on our cost. They also need to let us have the ancillary services for migrations and not invade that space."

Clearly, many Microsoft executives are listening, mainly the ones who interact with the partners regularly. Folks like Quigley, Cindy Bates, David Willis, Margo Day and worldwide leaders like Gavriella Schuster, Jon Roskill and Allison Watson, have all staunchly supported the channel. But it does look like decisions being made above them have deeply affected Microsoft partners.

One former Microsoft employee shared an observation that seems to be a great place to conclude this chapter of the discussion: "Some years ago, Microsoft decided they didn't need the channel in order to go to the cloud. Funding, programs and resources were cut. That was a bad call as every organization sees themselves as a special snowflake and wants someone to walk them through setting up IT for their business. That someone is a partner.

"Which leads me to the big truth: IMHO, the only true competitive differentiator that Microsoft has in the cloud is the channel. They can't claim capacity or major tech superiority. The emphasis on partner is coming back, which is great, and it's nice to see that someone reacted to your article. But it's going to take some time and hard work to rebuild the ecosystem to where it was. I work with [Amazon Web Services Inc.] now, and [its] partners are huge fans of the company. I remember the days when Microsoft was that."

So do I.

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