For virtualization giant VMware, partner strategy is a serious business. The company does over 95 percent business through partners in Asia Pacific and Japan (APJ) region. Ideally, we’d like to do 100 percent business through partners, points out Sharat Sinha, VP of Commercial Business and Partners, APJ at VMware.
In a conversation with ChannelWorld, he reveals the secret recipe of sustainable digital transformation and how the organization is strengthening its relationship with channel partners to chart the next chapter of success.
VMware is going big on software defined data center (SDDC), how important is the SDDC story for the partner ecosystem?
VMware enables its partners in a comprehensive way – in terms of product capabilities and developing service capabilities for partners so they can take customers through the DX journey, which is a continued effort. It has evolved to a stage where VMware is training partners not only in technical terms but also in sales, and providing programs that are highly profitable for them.
VMware has introduced a deal registration program called Adplus - where when partners find an opportunity and do deal registration, they receive a 30 percent discount upfront on a product like NSX and vSAN.
SDDC is fundamental to digital transformation. By utilizing SDDC, which is a combination of server virtualization, network virtualization and storage virtualization, and using cloud management on top, the customers get an IT infra which is virtualized and ready for digital transformation. SDDC gives investment protection where customers have infrastructure that can be used in a cross cloud environment. Also, it optimizes cost and allows them agility to launch new services.
There is a huge demand for it because it simplifies things in a very secure way. For example, the network virtualization element of SDDC enables an environment which has intrinsic security. Given this, it’s important for both partners and VMware to create products and services according to the needs of the customers. It’s important to understand what the customer wants and then take the technology to the market.
What has been the response of partners towards SDDC?
It’s been pretty good, which is reflected in the results on our side. Both NSX and vSAN are pretty much billion dollar run-rate businesses and one of the fastest growing software products in the industry. vSAN, for example, is growing in triple digits for VMware – globally and in APJ. NSX too has high double digital growth. This reflects fast adoption by customers and it’s deployed by our partners so there is continued traction.
Initially, the company focused primarily on technical enablement, which has gone well. Now, partners are asking for sales training, which we have started executing for them.
How important is it for channels to include services in their business strategy, rather than just sticking with the traditional box-push approach?
Most of our partners have built their business on services and it is an extremely critical element of partners business. VMware gives partners the same training it gives to its employees. The company has introduced a deal registration program called Adplus - where when partners find an opportunity and do deal registration, they receive a 30 percent discount upfront on a product like NSX and vSAN. Apart from enabling, we have also focused on predictable profitability, which gives partners deal protection and a highly profitable business opportunity to grow.
On top of it, VMware launched a masters services competency program, where the company is transferring intellectual property to partners. This enables partners to get certified, trained and VMware gives them joint branding.
So, there are a few elements needed to be successful in services space – one is deal protection, which we are providing through Adplus. Secondly, unique capability - which we provide through masters services competency, and thirdly, credibility through joint branding.
VMware’s portfolio has broadened significantly. How are you strengthening the relationship with partners so that they don’t get overwhelmed with other tech vendors and their solutions in the market?
We are doing a couple of things on that end, and it’s true out product portfolio has broadened. There are few things we do, which aligns our sales very closely with partners’ sales strategy. One is called joint business planning. Each partner business manager is measured on the basis of having a joint business plan, if they don’t have it, they don’t get paid.
Another thing that makes partners profitable is the deal registration process – it gives them better margins. We measure our own team on the same metrics as we measure our partners.
What other technology trends according to you will be profitable for partners in the next couple of years?
VMware has already evolved quite a bit when it comes to technology beyond SDDC. End user computing, desktop virtualization, enterprise mobility management and cloud are billion dollar businesses for the company. Similarly, both NSX and vSAN have a billion dollar run rate. This has created massive opportunities for VMware and their channel partners in the market.
VMware’s partnerships with AWS, Google, IBM and others have created huge opportunities in cloud services space for partners. Also, a significant portion of VMware customers have not yet deployed these newer technologies. In the next few years, the focus will be on growing our business more through partners. The company is already engaging in technologies like 5G, IoT with pilots and early deployments.