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How IBM is changing its partner tune

How IBM is changing its partner tune

Lucrative incentives and placing more business back in the hands of partners are some ways Big Blue is trying to change its model

If there’s one thing that partners are taking away from IBM’s PartnerWorld event, it is how the company is trying to change the way it handles business with its partners.

In earnestly transforming its partner program and incentives, IBM is making it clear, it wants partners to have a larger handle on 'commercial' business opportunities.

And one way that it is doing this is through being transparent on its client segmentation, which involves three global market segments -- industrial (top 900 global IBM-led accounts), enterprise (14,000 accounts that are co-led with partners and IBM representatives) and commercial (170,000 clients that are owned by business partners).

“We understand one of the most important attributes of the partner ecosystem, is to have your own client segment," IBM general manager of global business partners, John Teltsch, said.

"For the first time in IBM’s coverage model history, we now have an agreement on the IBM software segmentation model and we’re committed to the segmentation for 12 months, ensuring that you know that you’re accounts are protected.

Previously that was six months, now it’s 12 months and we’re working to get that to 24 months. To show how dedicated we are to the commercial segment, we’re removing commissions and all commission payments for (internal) IBM sellers to sell direct. If they don’t leverage a partner, they don’t earn commissions.

“We’ve also deployed compensation plans for collaboration between our reps and your reps to ensure success."

As a result of this, Teltsch said that in the last six months he has been building new skills within his own team and the rest of the organisation in an effort to deliver better value to partners and distributors.

“We’ve been adding new talent across our geographies, brands and on a worldwide level. Most importantly we’re consolidating, integrating and eliminating many of the traditional ways we’re doing business and the rules that drive us,” he said.

The company has also taken steps towards simplifying and consolidating more than 100 software program incentives down to five categories. 

Teltsch explained how this now involves client segmentation, partner-led solutions, new client acquisitions, and if partners develop their own marketing incentives, leads and close those leads, they’ll earn an incremental incentive as well as on-time renewals.

In addition, Teltsch said it has also improved its global IBM partner financing incentives to increase total earnings opportunities.

Additionally, Teltsch highlighted five areas were IBM is making significant investments through improving its end-to-end partner experience, simplifying partner incentives programs with clear client segmentation, and doubling down on its commitment to partner enablement, competency and certification.

Furthermore, it is also and expanding its embedded solutions business models, while aggressively developing third party marketplace approaches and delivering new go-to-market models.

IBM has also simplified its partner portal and improved its lead management processes to ensure the right leads were going to the right partners through Score (Smarter Cognitive Opportunity Recommendation Engine), which is built on Watson technology.

“Partners now receive more leads, and based on our own cognitive approach, opportunities are sent to the value partner with the right skills to close the leads. Score is also designed to provide the right leads to partners within 48 hours,” Teltsch said.

Big Blue has also further refined its co-marketing program in an effort to make it less complex aiming to make it easier for partners to submit claims, build and optimise a demand generation effort and improve closure rates.

“We invest US$80 million per year in our co-marketing program, with over 25,000 partners globally, leveraging this with 12,000 marketing programs that generate US$4 billion in pipeline - but over the past six months, we’ve made great strides in reducing this complexity,” Teltsch said.

“Our passion is around dramatic improvements to our partner experience across every facet of your engagement with IBM, but when it comes to integrity, trust and compliance, we will never waiver on our dedication and vigilance across our ecosystem business model. 

"No transformation is ever easy, but we’re confident that building this next generation ecosystem will offer partners great opportunities for growth," he said.

Julia Talevski travelled to IBM PartnerWorld at Think in Las Vegas as a guest of IBM.


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