the business of corporate marriage how to evaluate partner program effectiveness
DESCRIPTION
Fierce competition, demand for increasingly tailored products and fewer deals up for grabs are the realities technology vendors face, which require savvy companies to find new ways to sell their products with exponential reach and efficacy. Identifying outlets to meet these goals can be daunting, but heeding the advice of the world's richest man will go a long way toward helping you achieve your goals. According to Carlos Slim Helú, "In this new wave of technology, you can't do it all yourself, you have to form alliances." TBR's research on partner and channel effectiveness is the guide to finding, selecting and partnering with the firm that will shoulder some of your sales obligations in this tough environment. On April 3, 2013 Senior Analyst Allan Krans recorded a webinar where he spoke frankly about smart investments vendors should make in a partner program, what expectations they should have, what partners really want from their vendors and what kind of growth you can expect from your channel. This deck was used during the presentation. We explored questions like: •How can IT vendors optimize investments and programs to accelerate a mutually beneficial engagement with partners? •What is the competitive landscape of partner-driven growth and the return on investment? •What are the broad programs competitors use to engage with partners, and what resources are provided? For more information please contact Alison Crawford @ [email protected]TRANSCRIPT
TBR
TECHNOLOGY BUSINESS RESEARCH, INC.
Go to Market & Partner Effectiveness
Webinar April 3, 2013
TBR
April 2013 | Webinar – Go to Market and Partner Effectiveness ©2013 Technology Business Research Inc.2
Presenter
Allan [email protected]@allankrans
Senior Analyst, Software and Cloud
Enterprise Software Cloud Ecosystems
TBR
April 2013 | Webinar – Go to Market and Partner Effectiveness ©2013 Technology Business Research Inc.3
Build Buy Ally
Accelerators: Increasing R&D
Spend Portfolio
expansion
Inhibitors: Tight S&M
budgets
Partnerships and alliances are becoming an increasingly important of IT vendors overall go to market equation
Accelerators: New technology Time to market
Inhibitors: Rising valuations Execution risk
Accelerators: New technology SMB Growth Customer
Solution Focus
Inhibitors: Structure Alignment
Mixed Trending Decreasing Focus Increasing Focus
Summary
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April 2013 | Webinar – Go to Market and Partner Effectiveness ©2013 Technology Business Research Inc.4
The pace of innovation growth is greater than the internal growth in distribution and marketing capabilities
Build Strategy
2011: $27 B
2012: $30 B
Total R&D Spend
2011: $921 M
2012: $1 B
Average R&D Spend per Vendor
2011: $51 B
2012: $54 B
Total Sales & Marketing Expense
2011: $1.7 B
2012: $ 1.8 B
Average S&M Spend per Vendor
Larger PortfoliosGreater Diversity of OfferingsMore Solutions Focus
Constrained SpendingLimited Headcount GrowthShift in Sales Models
*All expense numbers are sources from TBR’s Software Benchmark Database
TBR
April 2013 | Webinar – Go to Market and Partner Effectiveness ©2013 Technology Business Research Inc.5
Buy
A traditional mainstay for many vendors, the acquisition activity is slowing, led by some vendors with the deepest pockets
Accelerators: New technology Time to market
Inhibitors: Rising valuations Execution risk
Decreasing Focus
Buy Summary
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April 2013 | Webinar – Go to Market and Partner Effectiveness ©2013 Technology Business Research Inc.6
The balance between acquisition impact and requirements is dampening the “buy” element of go to market strategy
+ Portfolio Expansion+ Sales Reach + Channel Expansion
Acquisitions Advantages- Rising Valuations- Shifting ROI Model- Execution Risk
Acquisitions Disadvantages
Buy Strategy
Buy Summary
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April 2013 | Webinar – Go to Market and Partner Effectiveness ©2013 Technology Business Research Inc.7
IBM acquisition activity will accelerate between 2013 and 2015, with cloud, analytics and back-office applications being the primary focusIBM’s Acquisition Evolution
Buy Summary
2010 2011 2012 2013-2015
Continued acquisition activity in growth initiatives, primarily analytics and cloud with additional investments to enhance
back-office solutions and supplement 2012 acquisition of Kenexa
TBR
April 2013 | Webinar – Go to Market and Partner Effectiveness ©2013 Technology Business Research Inc.8
HP’s acquisition spending dropped to $0 over the last five quarters as the company reorganizes and bundles the IP it has before looking to add moreHP Software’s slowing acquisition activity
Buy Summary
Company Acquisition Date
Est. Price
Est. Number of Employee
Autonomy August 2011 $11 B 1,500
Vertica February 2011 $.350 B 100
ArcSight September 2010 $1.5 B 512
Fortify Software
August 2010 $.265 B 150
Over the last decade, HP has built it’s software portfolio through acquisitions, with multiple acquisitions annually. However, under the new leadership of Meg Whitman, there have
been no acquisitions made across the entire company in the last five consecutive quarters.
TBR
April 2013 | Webinar – Go to Market and Partner Effectiveness ©2013 Technology Business Research Inc.9
Partnerships and alliances are becoming an increasingly important of IT vendors overall go to market equation
Ally
Accelerators: New technology SMB Growth Customer
Solution Focus
Inhibitors: Structure Alignment
Increasing Focus
TBR
April 2013 | Webinar – Go to Market and Partner Effectiveness ©2013 Technology Business Research Inc.10
Vendor
To complete the distribution partnership, the need, structure, and investment must remain intact at each step in the relationship
1. Need2. Structure3. Investment
Partner
1. Need2. Structure3. Investment
Customer
1. Need2. Structure3. Investment
Ally Summary
Ecosystem Model
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April 2013 | Webinar – Go to Market and Partner Effectiveness ©2013 Technology Business Research Inc.11
The erosion of EMC’s Dell relationship provided the business need to spur greater focus and investment on channel partnersEMC’s Channel Evolution
Ally Summary
EMC Channel Evolution Timeline
Channel-only
Products
Enhanced financial
incentives
Direct Sales Realignment
VSPEX Program
“following the disintegration of the Dell relationship, it would have been an easy excuse for a slowdown in revenue, but you didn’t see us do that. We refocused on our channel relationships outside Dell to fill that gap and move the company forward” – Senior EMC Executive
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April 2013 | Webinar – Go to Market and Partner Effectiveness ©2013 Technology Business Research Inc.12
The business result for EMC has been a gradual shift in its customer mix, leveraging SMBs to achieve growthEMC Customer Segment Mix
Ally Summary
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April 2013 | Webinar – Go to Market and Partner Effectiveness ©2013 Technology Business Research Inc.13
The business need and intended customer needs have driven companies like EMC to employ a diverse set of partnership vehiclesEMC Alliance, Investment, Acquisition Strategies
Ally Summary
>$1 billion run rate Mounting losses for
EMC
Increasingly close alliance relationship
Shifting products back, forth, and out of the alliances
Infrastructure play that is broader than Dell relationship
Geographic and customer segment strategy
Formalized EMC venture function
Some financial wins, but focused on industry insight
EMC’s partnership and joint venture activity is amongst the most diverse in the industry Another VMware link
Funnel for other initiatives
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April 2013 | Webinar – Go to Market and Partner Effectiveness ©2013 Technology Business Research Inc.14
Overall Partner Program Attribute Importance vs. Satisfaction
Though all program elements rank as important, the primary business need for partners is largely tactical and deal-driven
Ally Summary
SOURCES: TBR RESEARCH; TBR INTERVIEWS
KEY3: MORE21: LESS
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April 2013 | Webinar – Go to Market and Partner Effectiveness ©2013 Technology Business Research Inc.15
TBR research delivers the drivers, requirements, and perceptions of each actor in the partnership cycle
Business strategy Programs Levels and
segmentation of investment
Business models Program requirements Vendor and program
evaluation
Product needs Distribution model needs Vendor & partner
evaluation
Ally Summary
Ecosystem Model
TBR Ecosystem Research Addresses the entire partnership cycle:
VendorPartner Customer
TBR
April 2013 | Webinar – Go to Market and Partner Effectiveness ©2013 Technology Business Research Inc.16
Presenter
Allan Krans, Senior Analyst, Software and Cloud
@allankrans
@TBRincwww.slideshare.net/TBR_Market_Insightwww.youtube.com/user/TBRIChannel
For further information, please contact:
Stuart WilliamsDirector, Software and Cloud [email protected]
James McIlroyVice President, [email protected]
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