If 2017 was a year when Microsoft talked the talk, then 2018 must be the time that the tech giant walks the walk in the channel.
Billed by many as one of the most fundamental changes to impact the ecosystem, the One Commercial Partner (OCP) roll-out has redefined what it means to be a Microsoft partner.
While the core vision principles remain at a high-level, deep in the partner trenches, front and back-end overhauls have combined to create a new model for partnering.
Launched in early 2017, OCP is a modern take on a contemporary channel, representing a rebuild from within the walls of Redmond, creating internal and external change in equal measure.
“Sometimes, vendors can go through global restructures and reorganisations but the channel finds that little changes,” observed Phil Goldie, partner director of Microsoft New Zealand, when speaking exclusively to Reseller News. “But we are focused on ensuring that we deliver on our promise for partners.”
From a structural standpoint, the One Commercial Partner organisation is architected around three key areas - build-with; go-to-market and sell-with.
“The best indicator of change is through our build-with team,” Goldie explained. “This focuses on how we can help partners build new products, capabilities and offerings.
“This allows partners to productise through the Microsoft cloud, while also having the right commercial models, pricing strategies and value propositions in place. Getting the right organisational structure in place was key to achieving this, but then it’s also about sourcing the right skills to drive change behind that.”
To drive such change, Microsoft kick-started the year with a triple channel hire in New Zealand, recruiting Hamish McNee, Matt Simpson and Daniel Larsen to boost partner capabilities specific to independent software vendors (ISVs).
Furthermore, the vendor also recruited former Intergen executive general manager Emma Barrett as enterprise channel manager in late 2017.
“We’re fully staffed,” Goldie said. “Our ISV hires in particular were key because it’s crucial to bring on board people who understand the business model of an ISV, alongside the technical architects and how they are looking to build on the cloud.
“But even in the areas that we haven’t hired new staff, there has been a lot of focus internally around up-skilling people to help partners land the right deals and programs. We’ve put in a lot of focus behind the scenes to ensure we have a full-strength channel team in New Zealand.”
According to Goldie - who assumed the role in March 2017 - the market has responded positively to the sweeping changes at a local level, with the onus now on Microsoft to turn rhetoric into results.
“There was a lot of promise from Microsoft around what we planned to do and partners can now see this beginning to pay off,” Goldie said.
“We’ve done a great job to get the team and the channel ready but nothing is ever complete because we’re consistently reiterating and improving.”
Even the most enthusiastic supporter will agree that the past 12 months have been a work in progress for Redmond, a change so fundamental that labels such as reshuffle and revamp hardly suffice.
Because at the core of OCP, a determination to entice a new breed of partner is evident.
This represents a different sell from years gone by, when products done the talking and a leading line-up of solutions stole the show.
Granted, the Microsoft suite continues to be as strong and appealing for customers as ever, and innovative and profitable for partners alongside.
But it’s the platform, through an intelligent Azure, that will be Microsoft’s magnetic pull in the years ahead.
Simply put, OCP mirrors the priorities laid out by Satya Nadella during his seven-hour visit to Auckland in November 2016, in an address that pictured a world in which ISVs rule the roost.
In short, developers and intellectual property (IP) builders represent the beating heart of Redmond’s new channel, a reality now hammered home through OCP.
With more than 120,000 staff housed across 120 subsidiaries globally, backed up by an army of channel partners, Microsoft can most certainly feel the pulse of the customer.
Since 1975, logo after logo of iconic brands have joined the long list of businesses leveraging the vendor’s technologies, amounting to a market capitalisation that has now surpassed US$700 billion.
But while partners remain patriotic and customers loyal, a giant the size of Microsoft still chases the elusive net new.
Net new in the sense of ISVs, of course.
Because in the world of cloud, the platform holds endless potential for innovation and crucially, consumption.
With ISVs front and centre going forward, Microsoft must now demonstrate the value of Azure to a group of all shapes and sizes.
The official Redmond, and industry, definition is an organisation that develops, markets and sells software that runs on third-party software and hardware platforms, including Microsoft.
“We have a very competitive technology platform,” Goldie said. “Perhaps that sounds a little generic but the high-value scenarios that can be delivered through Microsoft are attractive for channel partners and ISVs.
“We’re seeing lots of long-term and new partners engage on the build-with side. As we engage deeper and deeper, we’re unearthing more opportunities. The build-with piece is never done because you’re constantly changing with product innovations.”
Developers are the heartbeat of digital innovation, making a thriving developer ecosystem mission-critical to the success of any Microsoft platform or technology.
According to recent Accenture findings, Azure developers are most satisfied with the platform’s accuracy, currency, findability and readability of content, alongside widespread approval with the timeliness and technical background of the support received.
Such endorsements will provide crucial reference points for the vendor when attempting to be universally acclaimed as developer-friendly.
“Many ISVs in New Zealand have plans to sell into markets outside of New Zealand,” added Goldie, alluding to Microsoft’s ability to help developers market and sell offerings globally.
“Through our sell-with team, which is consistent in every market across the world, we can take those solutions to market providing partners are willing to invest also.
“If you’re an ISV building first-party IP, the ability to take that through the Microsoft channel and through our selling teams globally is attractive.
“For example, if you’re building software for airlines and specialise within that market segment, many if not all of the airlines globally have some form of buying relationship with Microsoft. This creates a unique opportunity to sell with the global sales organisation.”
With plans in place to “remove the friction” between selling teams globally, the prospect of a one-way ticket to global expansion ranks high as an attractive selling point for Microsoft in the cloud.
“In New Zealand, it’s a huge plus for ISVs,” Goldie added. “This is an inherently small market that is highly innovative and has had lots of success stories from a software point of view.”
In observing local market trends, Goldie said customer demand is placing increased pressure on the channel to deliver innovation through the cloud.
“Particularly through advanced workloads and scenarios such as artificial intelligence, bots and machine learnings which require a different depth of skills,” he explained.
But while Microsoft has pivoted in the direction of cloud, software development and digital transformation, the channel remains counterbalanced.
For this would be a turning of the titanic, an ecosystem globally that boasts more than 600,000 partners, of which around 3,000 operate within New Zealand.
“You can’t move an entire ecosystem of partners,” Goldie acknowledged. “It’s not true to think that the Microsoft channel can be lifted and shifted, it’s just not practical.
“But the opportunity today outstrips the size of the market from a partner point of view in New Zealand. Partners are analysing the market and assessing capabilities which is helping clarify positions within the channel.”
Microsoft, and the many products that it developers, manufacturers, licences, supports and sells - spanning cloud, software and hardware - is unrivalled in depth and breadth of offerings.
Whether it be Office 365, Windows 10 or Azure, partners have access to a shop window of solutions and services.
Choice can create challenges however, as the channel jockeys for position in the years ahead. Bets must be made, gambles put in place and clear strategies outlined, with Microsoft a leading horse in the race.
“We’re unique as a technology vendor in the sheer size and breadth of our partner ecosystem,” Goldie added. “The design principal is that we’re trying to ensure everything we do is as scalable as possible so we can bring as many partners along as we can.
“As with change however, some partners won’t want to move and may place bets elsewhere, ultimately that decision is down to the partner as they run their own business.”
While partners are very much in the driving seat when it comes to decision-making, and aligning with both technology and channel platforms, Goldie said that even though Microsoft is racing ahead, crucially, a bridge remains for those with an appetite for instigating change.
“We have the right resources already in place should partners come our way,” he added. “Through our build-with team for example, this is a dynamic part of our channel which works with partners at the right time.
“Rather than bringing everyone along together, if partners see an opportunity to invest in emerging technologies or markets, then we have the right people in people. If now is not the right time, we will be here when they are ready.”