IBM Drives Changes in the Channel

IBM has reinvented itself with an innovative portfolio of advanced technologies – cloud, data, AI, Watson, Quantum – and an unmatched vision for business and industry – a leader among traditional computer vendors. In the channel, however, IBM demonstrates less innovation.

The problem? It’s tasked with keeping its traditional vendors happy while working a new breed of partner that defines the future of partnering.

But that didn’t stop IBM, Wednesday, from rolling out new initiatives and making new commitments to the 2,200 partner attendees at IBM PartnerWorld at Think 2018 — that’s twice the number as last year. In fact, all the partners in the room got to meet John Teltsch, general manager for IBM global business partners — the company’s channel chief since June. Teltsch took the reins when Marc Dupaquier left the company.

Teltsch outlined the three catalysts driving change in the company’s channel: Partners want more transparency, simplicity, and lower costs of doing business with IBM; changing markets; and IBM’s dramatic transformation over the past few years that puts an intense focus on cloud, security, data, and modern infrastructure.

“IBM is transforming, the ecosystem is transforming, the market is transforming; thus, we need to transform inside our ecosystem,” Teltsch told the audience. “So we’ll accelerate our execution model [to do that].”

John Teltsch

IBM says it is committed to making investments in the following five areas:

• Improving the overall end-to-end partner experience.
• Simplifying its partner-incentive programs with clear client segmentation to improve focus.
• Doubling down on its commitment to partner enablement, competency and certification, which drives differentiation and value.
• Continuing to expand its embedded business solutions models while aggressively developing its third-party marketplace approaches, and delivering new go-to-market models.
• Focusing on lowering the barrier to entry for partners to interact, develop and buy from IBM.

Of particular interest are the changes the company is making to client segmentation. For the first time in IBM’s coverage-model history, it has agreed on its software segmentation model.

“We’re committed to the segmentation for 12 months, ensuring that you and your accounts are protected. Before it was six months, now it’s 12 months, and we’re working to get that to 24 months,” Teltsch said.

The company also promised to be more transparent about client segmentation and where partners invest versus where IBM invests its resources. In 2018, the tech giant will deliver the following across three global market segments: the top 900 global accounts are IBM-led; the 14,000 accounts within the industry segment will be co-led; and the commercial segment will be business partner-led.

To show its dedication to the commercial segment and its business partners, IBM is removing commissions and commission payments to IBM sellers who sell direct.

“If they don’t leverage a partner, they don’t earn commissions and they don’t retire quota,” Teltsch said.

There are also new compensation plans for collaboration between IBM reps and partner reps to ensure partners’ success. IBM also reduced its hardware/software incentives from 100 to five, announced in January.

The company further announced four initiatives to help accelerate next-generation partners across its ecosystem.

• Enabling ecosystem transformation. IBM is making it easier for business partners who resell its technology to shift between engagement models and move up the client value chain. The company has consolidated the number of competencies it offers to make sure they’re relevant to product authorization so that partners can get higher recognition, faster. IBM also added new features to the Program Console and PartnerWorld Advisor. The company introduced enhancements for partners that want to embed IBM technology into their solutions, including new bundled partner benefits and expanded SaaS trials, sandboxes, IBM Cloud credits and development assistance for those who want to build new solutions on IBM technology. The company will continue to expand its marketing development funds.
• Introducing Watson Build 2.0, the AI challenge to build new IP. This is the second iteration of the Watson Build challenge. The first challenge drew more than 1,300 firms to IBM design-thinking workshops, spurred 400 AI-based business plans and enabled more than 100 partners to advance and develop new embedded AI solutions. 
• Launching a new, digital self-service platform. Designed for partners who are building and selling solutions with integrated IBM technology, the platform provides access to leading-edge technologies and offers technical support, pre-built code patterns and skill-building courses. IBM will offer several promotional offers to partners to get started building quickly with IBM Cloud, AI and data. Once partners are ready to take their embedded solutions to market, they can list them on the IBM Marketplace.
• Expanding its digital footprint with third-party cloud marketplaces. IBM recently signed a new deal that means partners and clients can find IBM offerings on a total of 10 different cloud platforms and reach more than 60 million new customers worldwide. New and existing partners can reap the benefits of these new routes to market as new customers bundle IBM technologies with other complementary catalog offerings and partner services. This provides a new integrated route for partners to serve their clients digitally.