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FY10 Microsoft Dartner Stratenamicsy Q&A
 
 Overall Strategy
What is changing and how does it impact partners? 
The Dynamics partner program is currently undergoing an extensive update to take more advantage of the significant market opportunity for integrated ERP and CRM solutions. Horizontal solutions havebecome a commodity and it is no secret that our prospects value vertically-specific solutions. We havebeen talking about focusing on verticals for a number of years, but we are bringing higher levels of focusand investment than ever.Microsoft’s strategy is aimed at increasing the scale and productivity of partners. It encourages smallpartners to grow and go vertical and it helps larger partners succeed and grow more. The Partner Strategysupports partners during this transition with program changes and investment aligned with key goals.Partners that are vertical and growing will receive more benefits and investment from Microsoft. MS willbe more prescriptive and proactive in aligning vertically focused VARs with the CfMD ISVs that canprovide them with repeatable, packaged solutions. By rewarding and investing more in the partners thatare aligned to our goals we can transform our partner channel and more rapidly gain market share.These changes will have a big impact. Our goals are to:1)
 
Triple the average customer adds of our VAR partners2)
 
Triple the number of ISVs and VARs gaining >50% of their revenue from packaged, repeatablevertical solutions3)
 
Increase the average operating margin of our partners by 50%
Do the changes apply to both Dynamics ERP and Dynamics CRM? 
This applies to both ERP and CRM. There are key differences in the products:
•
 
CRM products are earlier in their life cycle, requiring a higher focus on new partner recruitment inmany areas.
•
 
CRM targets the Core Midmarket up to the Enterprise, which drives requirements for more globalpartners and tighter engagement with the Microsoft Enterprise Field sales force
•
 
Microsoft also sells CRM under VL, which drives differences in the sales and fulfillment process
•
 
CRM also has a unique opportunity to be sold as a development platform for custom apps, whichwe call xRM.With that said, there are key similarities that drive natural alignment in the partner program:1)
 
Customers prefer solutions that are specific to their vertical whether we are talking about ERP orCRM2)
 
Both product segments are requiring higher levels of partner sophistication, investment and scalebased on the potential of not only vertical solutions, but also Microsoft stack integration (SQL,SharePoint, Office, and Outlook). This motivates us to drive our partner strategy and programs tosupport a consistent end-game, the support and nurturing of partners driving growth and scalethrough a vertical focus.
 
 
Why are we making the cha
Though Microsoft Dynamics consistnot growing fast enough to rapidlyconsider Dynamics solutions as oftethan any other major brand. Beingpartners spent on the sales cycle isSo we are focused on this key issueapplications that take advantage of for the specific needs of the individ1.
 
VARs that invest to deeplychallenges of the prospectsare our most successful par2.
 
ISVs that write repeatable,for Dynamics and a criticalsolution does not scale. It don a vertical value proposition andScale is important. Partners that knengineers and consistent marketinggrowing our average partner to 1,0those with 30, 40, 50 people and gehundreds of dedicated Dynamics pthese same growth rates.
nge? 
 ently performs better than the overall ERP and CRMgain share or defragment the market. Research shon as our main competitors; however, we do not winonsidered but not winning is terrible. It means thatasted.– Win Rate. The path to a higher win rate is in sellinthe integration to the rest of the MS stack and oural customer. To drive a higher win rate, two criticalnderstand the vertical requirements, processes and. Our research shows that the Dynamics partners thatners.ertically specific code. Customization is a key compource of revenue for our Partners, but too much curives the prospect price too high and the implemenlonupnesof prodacollenrevWeexakinparisshastothecodrionnect the leads with the right partners that can wiow the vertical, Partners that know the stack, dedicaexecution all take a level of scale and size. We are n0 people. We are talking about taking our current ctting them to 90, 120, 150 people. Even if a partnerople, there is plenty of market opportunity for largemarket, we ares that prospectssubstantially moreall the moneyvertically specificbility to customizehings are needed:businesst have done thistitive advantagetomization in theation cycles too. It makesrading to theest version of theware a high costposition, whichages ourective long termancementnue opportunity.have a lot of mples of the rights of ISV and VARtners today. – Thee is that Microsoftnot done enoughrescriptively alignbest ISVs with themitted VARs,e demand basedn the deal.ed pre-salesot talking aboutore partners,lready hasr partners to reach
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