By: Dann Anthony Maurno
Microsoft is pledging this week at Inspire 2017 to make a transition from a “partner led” organization to one that is “partner first.” And with the re-organization that preceded the event, the company is also showing it is transitioning the way Microsoft solutions will compete in the marketplace.
As Inspire begins, the company has noted a range of stats to underscore partners’ importance to Microsoft in fiscal 2018, among them:
- That 30% of partners have joined network in the last 12 months
- More than $17 million people are employed by partners around the globe
- Microsoft has more cloud partners than AWS, Google, and Salesforce combined
- That more than 64,000 cloud partners exist globally
- 95% of commercial revenue comes from partners
- Partners receive 19% higher margins than the next closest competitor
Microsoft is embarking on an effort to reform its partner strategy by bringing partner-facing roles under one organization, a move that the company hopes will improve both partner and customer satisfaction.
ISV Cloud Embed, and a co-sell investment
Microsoft has launched its “ISV Cloud Embed” program, aiming to boost partner usage of Dynamics 365, PowerApps, Power BI, and Flow in third party business applications. The company promises that the platform will lower partner development overhead and costs, tiered go-to-market support and the opportunity to showcase apps through Microsoft AppSource.
Microsoft Business Applications & Industry General Manager Alysa Taylor describes the Embed program as enabling partners to “take [Flow, PowerApps, Power BI, and Dynamics 365] and make them building blocks for the ISV ecosystem; they can take sales automation, finance, and operations or our service line, and build unique IP on top of those building blocks and distribute and provision their IP out through cloud service provider network.”
Next is a significant co-sell investment, spanning Microsoft Azure, Dynamics 365, and Office, aimed at increasing incentives for Microsoft’s Azure co-sell program. This, says the company, has helped close more than $1 billion in annual contract value for Azure partners over the last six months. The investment is chiefly in channel managers, a new role at Microsoft which is 100 percent focused upon supporting partners’ go-to-market efforts.
Taylor describes the latest co-sell efforts as the most comprehensive partner offering among cloud providers, between training resources, marketing resources and sales incentives. Microsoft sales reps are paid up to 10 percent of the partner’s annual contract value when they co-sell qualified Azure-based partner solutions.
“Super-significant” unveiling of Microsoft 365 commercial bundles
Nadella in his Day 1 keynote will “talk about how the new culture of work requires new solutions, which we’ll be delivering,” a spokesperson described.
To that end, Nadella will unveil Microsoft 365, a bundled offering that incorporates commercial offerings including Office 365; Windows 10; Enterprise Mobility and Security. There will be both Enterprise and Business editions available this quarter, with pricing to be revealed at Inspire.
Microsoft describes the offering as a significant opportunity to grow deal size, increase offerings, and grow managed services revenue, and cited a Forrester Research estimate that Microsoft 365 will increase the partner opportunity by more than 50 percent versus selling Office 365 alone. Corporate Vice President, Office 365 Marketing Ron Markezich described Microsoft 365 as a “super-significant brand and product offering” that brings together the foundation of 100 million Office 365 users and 400 million active devices on Windows 10.
General availability of Dynamics 365 apps and LinkedIn integrations
Both slated for July release, partners can expect Microsoft Relationship Sales, which is a joint solution with LinkedIn Sales Navigator and Dynamics 365 for Sales, and which helps sales orgs modernize with social selling “at an incredibly competitive price.”
Markezich describes a scenario in which Microsoft 365, LinkedIn Sales Navigator and Dynamics 365 work together. Consider a field services support incident, with an alert from a device needing maintenance. Dynamics 365 dispatches a support technician, LinkedIn identifies the decision maker in charge of the device and provides an upsell opportunity, while Office 365 enables collaboration.
Microsoft will also broadly unveil two new business apps for enterprise, including Dynamics 365 for Talent and Dynamics 365 for Retail, first announced by Microsoft EVP, Cloud and Enterprise Group Scott Guthrie in April. Dynamics 365 for Talent covers the end-to-end employee lifecycle, from recruiting through billing and payroll, and with deep integration with LinkedIn, Office and Azure.
Azure Stack from hardware partners
Microsoft will announce that the Azure Stack hybrid cloud platform (which company communications chief Frank X. Shaw calls “a crown jewel of the differentiated hybrid strategy”) is now available to order from launch hardware partners Dell, EMC, HP Enterprise and Lenovo, with Cisco and Huawei soon to follow.
Here, the opportunity is for partners like Rackspace to grow their Azure business and to reach new customers by extending Azure on premise, and by making cloud and digital transformations a reality for customers.
Azure Stack will be available on a consumption-based pricing model which can accrue to Azure subscriptions, based on virtual CPUs per hour or month. Pricing has yet to be revealed, but Microsoft promises a rate card lower than that of Azure. Microsoft is pledging that Azure Stack is not “Azure Lite”: infrastructure and services updates will be on pace.
Customer and partner momentum, and an audit platform
Althoff on Day Two will cover partnerships aimed at enabling partners, including last week’s co-selling agreement with storage provider Box (a surprise; Box was rumored to be an acquisition target for Google); he will also present partnered success stories with retailer Sephora and construction contractor Airtech.
The newest such partnership is with professional services firm KPMG, to bring their Clara intelligent auditing platform to Azure – the first of the big four auditing firms to bring its auditing platform to the public cloud.
Security, privacy and GDPR
Smith on Day Three will discuss the increasing importance of security and privacy in a world in which every company is a digital company, and will detail how Microsoft is integrating privacy into its products and services.
No details yet, but Smith will discuss how Microsoft is “uniquely positioned” to protect and defend customers, and how cloud partners have key roles to play.
He will discuss the EU’s GDPR legislation, which takes effect next May, and strengthens protection of personal data. As Shaw describes, “Customers will need partners’ help” with GDPR, and Microsoft will release a new GDPR assessment tool for partners’ use.