It should not come as a surprise that Microsoft is shaking up things again. This time the focus is squarely on its long-running partner program. This program’s roots stretch back to the early 90s and focused on providing solutions through on-premise applications. But now the cloud is eating software at a gluttonous pace with no signs of stopping.
With a vast majority of revenue streams being cloud-based, the partner program overhaul represents Microsoft’s continued commitment and investment in the cloud – which is the greatest growth market the world has ever known.
However, for the CXO, this that they will need to understand the impact their businesses, how the co-creation elements are shifting, and asking, “Do I have the right Microsoft Partner?”
What’s Going on Here?
First, the name is changing from “Microsoft Partner Network” to the “Microsoft Cloud Partner Program. This encompasses the full partner ecosystem – “building and selling services, software solutions, or devices.”
Second, the overall goal is to simplify the program and align it with Microsoft’s go-to-market strategy in six core areas:
- Data & AI (Azure)
- Infrastructure (Azure)
- Digital & App Innovation (Azure)
- Business Applications
- Modern Work
Third, customers have driven the necessary changes as their needs have shifted on tech intensity. Further, the model has been flipped so that the customer is at the center of this co-innovation and the partner is enabling the digital transformations.
Shifting the Competencies
Of course, this change doesn’t come without impacts on the competencies that Microsoft Partners must achieve and maintain. Again, with simplification in mind, Microsoft has introduced new Business Applications designations. The goal is to give customers “a way to identify you as a partner who is committed to training and accreditation and has delivered solutions.”
This requires partners to maintain a Partner Contribution Indicator (PCI) score of 70 points or higher for these Business Applications areas:
- Cloud Business Applications
- Enterprise Resource Planning (ERP)
- Project and Portfolio
- Small and Midmarket Cloud Solutions (specific to Business Central)
Additionally, the PCI score is comprised of three components:
- Performance: Measured by net customer adds
- Skilling: Demonstrates your dedication to skilling and training with intermediate and advanced certifications
- Customer success: Measured by usage growth and the number of solution deployments.
What Does This Mean?
For the more than 400,000 organizations around the world that make up the partner program, this forces them to be as equally committed to the cloud strategies Microsoft is investing in. Further, it will (unfortunately) weed out the partners that aren’t up to the task or have a mindset stuck in the past – and they only have until October 2022.
But, this opens the door for customers to bring their co-innovated solutions and services to market which, in turn, unlocks opportunities for their customers. CXOs can tap into this potential to drive new lines of business, service models, or product categories.
To add to this, Bob Evans, the Founder of Cloud Wars and Co-Founder of Acceleration Economy, spoke with Kees Hertogh, GM for Global Industry Product Marketing at Microsoft during the Industry Cloud Battleground event in November 2021 which surfaced early indicators of what was to come.
Kees emphasized the importance of co-creation with customers and partners as a “a vital component of Microsoft’s success.” The outcome of this co-creation has led to:
- A common understanding of data to drive critical decisions
- A faster time to value – which should be dropped and recoined as the “Time to Dazzle Customers and Employees”.
So, now, we are seeing all this come about through the ongoing evolution of the Microsoft Cloud Partner Program. Something to note is that, according to Microsoft, this is “not changing the value to partners”, but instead, “changing how partners get to that value.”
Further, this is creating opportunities for partners to pivot their business models to the cloud which aligns with the imperative of digital transformation and digital acceleration – all of which the CXOs needs to dazzle customers.
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