Channel Marker

Jul 21 2008   2:10PM GMT

Thoughts on Microsoft WPC (plus seven)



Posted by: badarrow
Tags:
Barbara Darrow
Channel partner programs
Cisco
Direct reseller channel conflict
IT channel products and technologies
Microsoft
Vendor partner business issues

It’s been a week since Microsoft’s Worldwide Partner Conference, and sometimes a couple days of beaching it (along with a little adult beveraging), puts stuff into perspective.

Here’s what percolated to the top of mind after some R&R:

First: : Stephen Elop’s message of “deliberate dependency” was perfect for this audience, most of whom have been battered by the one-two punch of a bad economy and the growing perception of Microsoft as a company of the past, not the future.

WPC was something of a coming-out party for Elop, the new president of the Microsoft Business Division, replacing long-timer Jeff Raikes. (Tough gig, btw.)

Said Elop: “Great software does not implement itself, it does not sell itself. There is so much work required to actually turn that software into a solution that meets the specific needs of customers.”

Also, he stressed that strategy in the abstract is fine , but the field is where reality happens–and can bite.

“All sorts of great ideas come flowing out of World Galactic Headquarters … but, at the end of the day the truth is where the customers are at, the truth is with the people who interact most directly with those customers. So I’ve learned to continue to spend a great deal of time with partners, and with customers, so that that truth, the truth from the field, is heard,” Elop told the more-than-10,000 partners in sweltering Houston

And finally: A vendor must clearly state the relationship between it and its partners. “I have consistently taken an approach, just as Microsoft has for 30 years, of building on a deliberately dependent relationship, between the company and its partner community. In other words, we each only succeed if the other succeeds.”

All great words. But, as Elop himself noted, the distance between aspirational verbiage from corporate bigwigs and field-implemented action can be huge.

Several Microsoft partners, talking informally  at the show, acknowledged the bad Microsoft behavior they face.

Large customers of small VARs are still shepherded to Microsoft’s favored few nationally-managed big system integration partners. These VARs readily admitted that Microsoft is less guilty of this bad action than other vendors (Cisco, take note) but it still happens all too often.

Microsoft at the field and regional levels tends to cherry pick partners willing to be quoted on its successes and channel friendliness over other partners who may have more expertise in a given area.

“How do I compete when my competitor [a rival Microsoft partner with the same competencies] has his name plastered all over the show by Microsoft?” asked one southern California-based Microsoft partner.

Second: The message out of one of the keynoters (which one escapes me, perhaps due to the aforementioned beveraging) was that no one but the customer can “own” the customer relationship.

Obviously,  the customer can work with the vendor or the partner of choice to get needed services, but Microsoft  execs claiming that direct relationships only occur upon customer request tests credulity. Several VARs said that Microsoft services personnel have tried to channel their customers into a more direct relationship only to be rebuffed by the customer itself. It’s a he-said, he-said thing, but face it: account control remains a point of conflict between partners and Microsoft. This is true of other vendors, but most of them don’t put on as energetic a partner-loving face as Microsoft.

Third: Microsoft software deployment rates are not perky. Stay tuned for more on this but Microsoft execs admitted off the floor that deployment rates for Vista (and for Office 2007 and perhaps other SKUs) have been “red flagged” within Microsoft. That is not a good thing. It means despite all the big talk about Vista flying off the shelves, it hasn’t met internal expectations.

What that means is there’s a lot of Microsoft software moldering on shelves that is not generating any service revenue. Needless to say, since partners don’t participate much in the license upgrade sales, this is bad for them, warns Paul DeGroot, analyst with Directions on Microsoft.

It’s also bad because companies that are upgrading just to keep their licenses up to date may start to wonder why they even bother.

More later.

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