Partner Compensation: The Never-Ending Issue

One complaint across the cloud MSPs participating in the inaugural Cloud Roundtable? Vendor compensation. Each MSP agreed that vendors have created overly complicated incentives that they don’t package well for partners’ salespeople. Vendors need to simplify their programs, the MSPs agreed, and stop overengineering to the point of overwhelm.

The MSPs understand how this happened. In years past, they got burned by partners who abused the system, they said. But the time has come to simplify compensation.

At the same time, more partners need to take more initiative to obtain their own business. Too many rely on vendors to give them leads, Safoian said. SADA has combated this internally. The MSP spent three years teaching partners how to earn their own business independent of providers, Safoian said.

Gaining leads without providers’ help can be tough, though, AllCloud’s Gil said. Small customers, especially, don’t have strong marketing departments. This makes it harder to target potential clients.

Safoian agreed but said he wants partners to erase that “victim mentality” and make more business happen. True, AllCloud’s Gil said, but vendors hold some blame for that old way of thinking. It’s time to transition mindsets and for providers to extend more margin so partners can spend on people. (Ensono’s van der Westhuizen agreed — “more margin,” he said.)

Finally, Safoian said, vendors need to do better at knowing how much business each channel partner brings. Executives need to understand the ROI of their partners so they grasp what a partner is worth them, he said.