Distribution of software sales leads to IBM partners happened on an ad-hoc basis before. Now the company promises to pass leads valued at up to $50,000 to the most qualified VARs, said Sandy Carter, vice president of IBM Software Group Business Partners.
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Authorized VARs that made the cut are happy about the change to the IBM partner program.
"You need the technical and sales certifications for the product brands, or as of Monday, you're not selling them anymore," said Lori Gianattasio, IBM national sales director for Perficient Inc., a St. Louis-based IBM authorized partner.
Promoting IBM VAR partners over big-box suppliers
After what can be a long and involved pre-sales process, many software resellers complain that they often lose deals to CDW, Dell or big-box retailers that throw in software to sell hardware. The goals of the new program are to promote IBM partners that provide value-added services, help them become profitable and avoid this kind of poaching, Carter said.
"This requires you to be a true solution provider -- not a big-box hardware reseller," Gianattasio said.
The program emphasizes complete offerings that solve business problems, taking the focus off of selling software SKUs. The net result is that VARs will sell less shelfware, said Devi Gupta, vice president of marketing for Prolifics, a New York-based IBM Premier Business Partner.
"This is very valuable to the customers," she said. "They won't be buying something they won't use."
IBM partners get upgrade, renewal opportunities
With IBM, unlike Oracle and some other competitors, VARs can participate in upgrade and renewal maintenance.
"With IBM software, whoever sells the software gets notified about the renewal," Gupta said. "So IBM sends a letter to the customer that says you can book it through us or your partner."
With this new program, authorized partners will be better able to sell maintenance and retain that business, she said.
To get authorization -- and the software sales leads that come with it -- a VAR organization must get two technology certifications and one sales certification per solution area or offer a solution that IBM has tested, Carter said. There are 11 solution areas in total.
Of course, qualifying for the program can cause controversy. Last year, when the vendor previewed what was then called its "Growth Through Skills" initiative, several IBM partners beefed about the time-consuming and pricey qualification process. In essence, it required that VARs be authorized to sell most of IBM's product line -- with the exception of the Express small business editions, the open source-oriented lineup and WebSphere Application Server, which still sell through open channels.
Carter estimated that 60% of IBM's software lines now sell through authorized partners, and that percentage will increase as IBM adds unified communications and Lotus products to the authorized-only mix and starts distributing software sales leads for those products later this year.
IDC analyst Darren Bibby said IBM has done a good job building a comprehensive program. Based on IBM internal numbers, the company could have handed out 70,000 software sales leads last year, he said.
Large software vendors tread a fine line: They want to field enough partners to make sure they have the right geographies and verticals covered. But they don't want so many partners that they end up competing with each other for business and eroding profit.
This new IBM plan, which includes cloud computing certifications, was to go live in October, but IBM decided the fourth quarter was a bad time to roll out the changes. So as of today, they are in effect.