Facetime with partners

Like a few other vendors, Novell cancelled its partner event, Brainshare, this year and has announced that it is reviving that vendor/partner meet.  

In speaking with technology partners, particularly ones from Europe and Asia, I am often told how much they value networking with other partners, learning what solutions work for partners in other regions, learning what overall trends are likely to affect their customers and establishing a personal, trusting relationship with vendor sales, marketing and technical personnel through face to face dialogue.

A year’s hiatus is not too bad a thing – it makes people on both sides of the fence realize the importance of that mode of learning and personal contact.   No newsletter, webinar, account visit, training class, let alone blog or tweet can come close to the hurly burly, frenetic, serendipitous speed dating that occurs when gaggles of partners mingle with other partners and their strategic vendors.  It is the fastest way to build a trusting ecosystem and has a high ROI where companies depend upon indirect channels as significant routes to market. That ROI is all too often not measured (one of the things my company can do) in terms of partner loyalty and pipeline which is one of the reasons why partner events suffer early blows from the accountant’s axe when sales turn south.  It is like turning off your email system and handing in your mobile phones to save costs. It is a direct communication medium, just as essential to a healthy indirect business, as those media we regard as fundamental utilities.

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Changing a Partner Program & the New Microsoft Partner Network

 Partner programs grow like coral reefs on steroids, rapidly accreting new forms, morphing into shapes that bear no resemblance to the outcrop that provided its original bedrock.  Microsoft’s program is such a reef, providing shelter and structure in a diverse ecosystem of partner types and business models.  Every so often a program needs a refresh, a shock to take it to the next level and it hopes that changes announced last week at its Worldwide Partner Conference will do that. Microsoft cannot hope to broaden its partner base – it already has 640,000 businesses within the program – the majority of all companies serving other companies in information technology.  The issue is quality not quantity.  There are already 16,400 Gold partners, the highest level of achievement within the program.  To differentiate within that level and the middle, Certified tier, Microsoft currently has 46 competencies corresponding to different sets of products or types of services and business models.   It wants to raise the bar. Microsoft, like many other companies could create a higher, platinum tier, but that would further complicate the program. The company has as one of its aims to simplify as well as purify the program.  

Partners want certainty.  Anytime a program changes, whether or not it will, in the end, benefit the partner, stresses a partner’s business.  Every new benefit proposed by a vendor always comes with a price tag, either explicit, or implicit in time, focus and energy.

Customers want certainty.  A vendor’s seal of approval should be a good indication of future partner performance.  When a partner’s program changes those changes need to be communicated and embedded in customer minds. 

And vendors want certainty that their interests and the end user’s interests are in balance and being well served.

The first change the company announced was a rename of the program itself, from the Microsoft Partner Program to the Microsoft Partner Network,  a more partner focussed sounding phrase.  Partner to Partner networking is a benefit of most partner ecosystems.  As Microsoft put it, “We want to create passionate communities where partners share best practices, spark innovation, and discover opportunities to serve customers better.”

The second change is that, by November, Gold partners must have participated in the Microsoft Customer Satisfaction Index (CSAT).   The index (or indices as it is a composite of scores) is flawed.   It is purely quantitative and relies on getting respondent details third hand. Four times a year, a request to participate in the survey is sent to contact email addresses provided by partners wishing to participate in the CSAT program.  Firstly, because Microsoft does not know who the significant influencers are in most of its end customers, it must rely on partners to supply those names.  Because partners perceive they have a vested interest in getting high CSAT scores, and because Microsoft has a vested interest in viewing individual partner scores, partners are more likely to provide details of satisfied customers.    Within partners, usually only the salesperson knows who the supporters (and detractors) are.  Salespeople are likely to be asked to provide contact names.  As individuals they have a vested interest in providing only the details of happy campers.  Plus account managers are likely to “assist” a customer to fill out the survey.  Secondly,  gauging satisfaction and loyalty in a changing business is complex.  It is in no way as straightforward as it is with individual consumers.  Relying on quantitative indices alone is foolhardy.  Raising the competence bar is a much better way of ensuring that customers are being served well.

To signal that the bar is being raised, Microsoft is changing the name of the two higher tiers, from Gold Certified to Advanced Competency and Certified to Regular Competency.   One question every vendor should ask before changing a program is this, “Will this change deliver more value to end customers?”  Because end users are used to the Gold Certified and Certified labels, the new names deliver less value in the short run.  If the competence of partners rises substantially in step with the name change, then in the long run, it may be a good thing.  The jury is out on this one.

Microsoft is also reducing the number of specializations from 46 to 30 and (thankfully) simplifying how they are known.  For example, “Custom Development Solutions competency with Application Infrastructure Development specialization” becomes “Software Development”.    The five specializations under Microsoft Business Solutions competency (e.g. “Microsoft Dynamics AX specialization”) become “Enterprise Resource Planning.”  Throughout the program, Microsoft has adopted the same principle of simplification and translating into a language that is meaningful to customers.  That is common sense and a signal that Microsoft is getting more in tune with its end customers.

But is Microsoft raising the partner quality bar, or is this just window dressing? Beyond compulsory participation in a customer satisfaction system that can so easily gamed, and language, how are these changes going to deliver more value to the end user?  At first glance, most of the competency requirements – technology exams and customer references –  do not appear to have changed.   There are lessons here for any vendor building end customer value through partner routes to market.

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Linkedin and Sales Channels

As technology partners tend to be early adopters of some types of social media, I thought it might be interesting to look at how some individuals working in technology partners are using social media.  Now, I have railed on about small samples with big pretentions, but I thought I would share with you some crude observations of the  first 109 individuals I looked at.  They were from around the world working in various job functions in companies varying in size from large enterprises to medium sized businesses, with an even split between those with technical, sales and line management roles. There were 17 individuals from APAC, 48 from EMEA, 1 from Latin America and 43 from the US.  I only looked at whether they had a LinkedIn profile and how many contacts they had.  I may broaden this to 500 individuals, time permitting, to get more a accurate picture.  Though some individuals on LinkedIn keep their profiles hidden, revealing only their job function, I knew enough about these people’s responsibilities  to know there were none like that in this sample.

In the US, 23% had no profile, whilst in Europe that figure rose to 40%.  Of the 6 Germans in the sample, none had LinkedIn profiles.  Checking on Xing, which originated in Germany, I could not find them there either.  Likewise of the 9 people from Singapore, China, Japan and Korea, none had LinkedIn profiles.  In India, France and the US there was much evidence of use.  In the US, of those who had profiles, there were on average 64 contacts, whilst in EMEA it was 65.  The crude observations are these – LinkedIn is popular in India, some European countries and the US.  Penetration is low in most Asian countries and Germany.

How is LinkedIn being used? One can surmise that the most obvious reason contact lists are built  is because people wish to feather their nest in preparation for a company switch, but many people use it as a glorified contact list. As with Plaxo, you can be fairly certain that if someone changes company, you will still be able to get in touch.  But are they using it, as headhunters do, to prospect – to look for contacts of contacts?  I am told that is how it is being used by some partners.  A recommendation from an existing client is a powerful endorsement – but why not just ask the client directly instead?   Perhaps the best endorsement they make will be a phone call to another decision maker not on LinkedIn.

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Channel Advocacy

Advocacy is a hot topic in marketing circles not least because social networks have increased the speed and spread of advocacy effects.  Company reputations are built more rapidly and eroded even faster. Pockets of ignorance, which buffered companies in the past, are dwindling. A whole new branch of marketing is emerging – social media marketing. At its core are well understood principles of advocacy and loyalty.

Advocacy is so powerful, it can be used as a leading indicator of sales, as shown in Marsden, Samson & Upton’s 2005 paper, “Advocacy Drives Growth“.  Using a survey of UK adult consumers, they found that a 2% reduction in negative word of mouth correlated with just under 1% growth in sales, whilst a 7% increase in word of mouth advocacy correlated with a 1% growth in sales. Perhaps companies should put over 3 times the resource in trying to satisfy the unhappy as they do in making those who are satisfied, happier. The squeaky wheel gets the oil should be the operative phrase.

With social networks, squeaky wheels are amplified, but only heard by corporates if their ears are tuned to multiple frequencies. A watchful ear to social media wires isn’t enough. Honest conversation over a variety of media is required. In B2B, that often means frequent, in depth, probing conversations with channel partners, something that can’t be derived from a web survey that bounds and stifles conversation.  Ask the question,  pioneered by Fred Reichheld, “How likely would you be to recommend…?” in such a way that you get an honest answer from a partner.  Then ask them why they said that.

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LinkedIn and Selling

Recently I came across a paper written almost two years ago by Tony MacKelworth, Social Networks: Evolution of the Marketing Paradigm. It must have been his masters thesis because there is a lot of meat that would impress most marketing academics.  MacKelworth now works for Microsoft UK but at the time he wrote the paper, he worked for AMaC,  a 2.0 company if there ever was one.  By doing so, he had an excellent set of contacts to work with, and managed to get 897 fully completed questionnaires from senior executives worldwide, asking them to rate the various ways they get information that might influence their decision on a business offering. 

MacKelworth set out to prove that credence is related to the source of information, though that seems a no brainer. The work is distinguished by spread of its sample and the range of questions he asked.  It is particularly difficult to get senior executives to participate in any online survey, so one usually finds that iffy conclusions are drawn on small samples.  This study’s implications for B2B marketing are significant.

Telemarketing, SMS ads, banner ads, unsolicited emails – in other words, push communication were discounted by most people and even disdained.  It found that recommendations from friends were regarded by most people as the most authorative sources of information regarding external products or services.  A company’s web site, and recommendations from individuals’ LinkedIn networks were also respected.  The importance of getting a company web site in shape is well understood, but leveraging LinkedIn is more complex. 

Would encouraging employees to get to the 500+ level in LinkedIn help a company or increase its staff turnover?   Or should it merely encourage the evangelists?  My favourite IBM software evangelist, Ed Brill , no matter what his job description, has blogged and fought for IBM for many years and as a result maintains a loyal following of people who also have large LinkedIn networks.   My favourite Microsoft evangelist, Eileen Brown has done a similar thing for that company for many years and, sadly, has been laid off.  The trouble with such social networks is their value cannot be measured, but as MacKelworth has shown, they are vital. Perhaps his new employers should read his paper.

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Leads – SharePoint or ShareSplodge?

I got it again yesterday.  Speaking with a partner they moaned about not getting leads. If I had a nickel for every time….  It is such an old chestnut and this is its root. There is, always has been, and always will be a fundamental schism between how many people in channel partners view vendors’ abilities to generate demand and how many people in vendors view those same abilities in channel partners.

Many people in vendors think that because a partner gets a discount, the partner should be chiefly responsible for generating demand for the vendor’s brand.  They overestimate a partner’s ability to promote a vendor’s brand and the margin that a partner is able to earn.  The smaller the vendor, the more often one hears this view– and it comes most frequently from direct salespeople promoted into roles where they have overall responsibility for direct and indirect sales. Conversely, partners think that because vendors attract prospects, there is a secret honey pot of leads that they only get rare, teasing glimpses of.  They overestimate two things: the ability of a vendor to promote that vendor’s brand; and the vendor’s ability to identify, qualify and manage leads.

Vendors are not well equipped to identify who expresses an interest in their offerings.    That is not just for new prospects. Vendors are often are not very good at identifying opportunity in loyal customers.  There is a gap between touch points – all the times a customer interacts with a brand –  and a potential sale. It often comes from a vendor failing to ask or not having the opportunity to ask “Why?” or “What are you using it for?” or “How will you do things differently in the future?”  Plus, customers, often don’t know those answers either because a need and a solution become recursive.  There is a gap too, because vendors lack processes to turn a download or web visit or a tweet into a frank conversation that could reveal a need that the vendor could profitably fulfil.  That is what keeps marketers up at night. Partners don’t understand how much a vendor doesn’t know. Godot isn’t coming. There is no honey pot. 

Let us say all those touch points could become qualified leads with accurate details on budget allocated, who has authority and a decision influence, what need is being satisfied and the timeframe for the project. How could they be fairly distributed?  A single lead for a single, simple project could be the product of multiple touch points within a number of partners, strategic alliance members and vendors. It is not a simple, closed system.  The honey pot is more like opaque, week old goulash, more ShareSplodge than SharePoint.

As for vendors, understand where your channel partners make their profits and the competitive pressures on their business and you will begin to understand their priorities, their mountains and your molehills.  As a salesperson you know you need to walk a mile in your customer’s shoes.  Try on a business partner’s pair for a change.

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Opportunities for channel partners in unified communications

In every downturn, there are always sectors of innovation that do spectacularly well. With companies cutting travel and with the growth in flexible working and dispersed teams, corporations are turning increasingly to unified communications to reduce costs, improve productivity and raise job satisfaction. According to IDC’s latest research,  the European UC market will grow from its present size of $2.6 billion in 2008 to $13.5 billion in 2013, an annual growth rate of 39%.  IDC believes that presents a significant opportunity for service companies.  Their value is enhanced because they can be a single point of contact for voice vendors and IT suppliers such as Cisco, IBM and Microsoft. As any UC systems integrator will tell you, getting pilots off the ground involves multi-disciplinary teams within the customer. It is a complex, political sale, one where channel partners can add significant value.  All three of the top UC vendors have made significant strides in growing their UC partner ecosystems to help address the demand.

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