IBM’s New Channel Chief: What are His Top Priorities?
IBM (NYSE:IBM) is putting a sharper focus on MSPs recently, recruiting 500 new managed service providers in the last five months alone. The uptick coincides with the appointment of a new channel chief in January as the company’s new CEO Virginia Rometty assembled her own executive team. Mark Hennessy, IBM’s general manager for the IBM Global Business Partners and Midmarket has spent his career at IBM in a variety of sales roles, and he’s no stranger to the value provided by channel partners. Hennessy told me that he is looking for partners to continue to grow as a percentage of IBM revenues between now and 2015.
For partners that will mean ramped up lead generation and continued investments — $2 billion a year – in the partner program with a third of that going to marketing. It’s all designed to help partners move their businesses to deliver more and more value for clients, he told me. For MSPs specifically, one big play right now is the IBM PureSystems offering, Hennessy said. IBM has promised that PureSystems will reduce deployment time and enable more automation, something that we all know leads to higher profitability.
The Scoop on IBM PureSystems
Announced last month, the idea is to offer a system that includes all the hardware, networking, software and services needed to get started. The hardware looks like a basic rack system that plugs into a standard 110 volt wall socket and a standard Ethernet connection. It supports Linux and Windows. MSPs can use these systems to host applications for end-user companies.
And a host of ISVs have created native applications for PureSystems, including SugarCRM, SAP, VMware and many others. The applications are offered for sale through an online enterprise application and solution store, The PureSystems Centre.
Hennessy also points to big growth areas such as the IBM Smarter Planet initiative. He says that close to 50 percent of the company’s Smarter Planet references come from channel partners.
That coincides with Hennessy’s top priority for partners going forward – to help them move to higher value with their clients. He says partners are doing this already as they transform their businesses to focus more on the solution sale. For instance, he said, some are doing it around system analytics, some around Smarter Cities engagements, others are doing it on an industry basis and some are expanding their geographical footprint. By driving more value for their clients they drive higher margins for themselves as well.
“That’s number one,” Hennessy said. “ We’ve got lots of activities within IBM to help drive that with partners.”
And the other priority? Hennessy told me that IBM would focus on making it easier for partners to work with IBM. Specifically the company is offering some new incentives, such as a single large incentive (and higher profit margin) for selling hardware and software together. It’s a less complex way to compensate partners who are going for the solution sale.
On the MSP side, Hennessy said that IBM General Manager for Global Small and Medium Sized Businesses Andy Monshaw has created a set of programs that simplify pricing, offerings and enhanced education. (We’ll be catching up with Monshaw soon, too.)