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Microsoft: Consolidating ERP, Office support will help, not hurt VARs

Microsoft has combined service and support contracts for its Dynamics ERP, CRM and Office applications.

Microsoft executives said the company's decision to add its Dynamics ERP to the same service and support plan as Microsoft's other business applications will reinforce the role of Microsoft Business Solutions partners, not undercut them.

On Thursday, Microsoft announced plans to add Dynamics ERP applications to Premier Support -- with the same Microsoft service and support contract as Office, Windows and SQL Server.

Previously Microsoft service and support customers would have to negotiate two contracts and deal with two Microsoft technical account managers (TAMs) -- one for Microsoft Dynamics Support, from Microsoft Business Solutions (MBS), and another for Premier Support of the other business applications.

That support is now consolidated under one contract and one Microsoft service and support TAM. "Dynamics" is the overarching brand name for Microsoft's four ERP lines and CRM.

For MBS partners -- who derive a big chunk of their revenue from Microsoft service and support -- the move hits a sensitive spot. But Microsoft insists the idea is to eliminate finger pointing and provide the best customer service.

"We still believe the partner has to be fully engaged with the customer, and we have collaboration mechanisms in place with Premier to ensure that," Jana Reinke, director of MBS Custom Services, said. "If we're triaging the situation and discover [the problem] is part of a customization and not the core code, we bring the partner in on resolution. We ask the partner, in exchange for a collaboration fee, to help document for us the customer install so we understand the third-party customization."

Dynamics partners already get an automatic alert when a Microsoft support call involves a Dynamics issue, Reinke said.

MBS sales and support has always stood a bit apart from Microsoft's "classic" sales process.

Whereas Microsoft's traditional model for sales, service and support of Office, Windows and most other products has been focused on a fast, high-volume sales cycle, ERP applications tend to require a slower, more hands-on approach, MBS partners have long said.

ERP sales thus typically carry fatter margins and higher service levels than "classic" sales. They have also worried that Microsoft would try to ramp up the process to the detriment of customer service and support.

The dichotomy was illustrated a few years back when MBS promised that the company's CRM product would be available only through authorized MBS partners.

However, it soon reversed course and put the application into volume distribution and made it available through standard Enterprise Agreement volume licensing, right along with Office.

ERP VARs also jealously guard customer relationships, viewing themselves as the customer resource of first resort. But many also maintain that they want tighter vendor relationships that might bring bigger resources to bear for support resolution.

Microsoft had offered a separate support contract, Microsoft Dynamics Deluxe, for MBS customers.

At past Microsoft partner conferences, several solution providers have complained in public forums that they have to deal with too many constituencies within Microsoft in order to address customer issues.

There has been a gap between the Small and Midmarket Solutions & Partners (SMS&P) division and Enterprise contracts, for example.

Many partners agree that Microsoft has made some progress by putting one technical account manager in charge of issues relating to both MBS and classic products, though the issue is far from resolved.

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