SAN FRANCISCO -- With hundreds of VMware partners in attendance here yesterday at the Americas Region Breakout session at VMware Partner Exchange 2014, company segment and specialty leaders reiterated the company message of the importance of investing in the software-defined data center (SDDC), end-user computer and hybrid cloud. Then, a panel of VMware segment leaders homed in on the partner opportunity for its 24,000 Americas partners...
in the various market segments – enterprise sales; midmarket; commercial; and state and local government and education (SLED) -- while the specialty leaders drilled down on opportunities in various technologies, such as Desktop as a Service (DaaS) and management.
Tim Merrigan, senior director for SLED at VMware, was the first of four segment leaders for the Americas channel to enlighten the audience about partner opportunity and what VMware needs from partners.
The SLED segment is 100% channel-led, and the opportunity is growing as VMware moves into more areas in the SLED space, Merrigan said. "The great part about SLED is that it's 100% repeatable," he said, meaning that the problem that one customer has extends to all. SLED is also segmented so it's important to match the right VMware partner to the right customer subsegment.
"It's going to be critically important for us as we get into the complex multi-state, multi-agency arrangements and also for the white-space attack on K-12 and local governments," he said.
Over the past year, VMware's SLED group has worked out the kinks in its go-to-market strategy and is looking for more partners.
Pete Dockery, vice president of enterprise U.S., healthcare and Canada enterprise sales, explained how two years ago the organization segmented enterprise customers as the Fortune 1500 in the U.S., the top 1,500 healthcare accounts in the U.S., and Canada as its own international segment – all of which make up Dockery's group. Today, the opportunity is moving from an opportunistic selling model to a value-based selling model, or from product to solution and from IT to business.
In that move partners, who get the business value opportunity, have become more critical than ever, Dockery said. "We need partners to work with our account team as we shift from an opportunity-based selling methodology to a value-based selling methodology. We need partners to help and lead our team on going deep in the business value and wide across functional areas," he said.
Brandon Sweeney, vice president for U.S. midmarket and SMB sales, said that his group is also 100% partner-led and very dependent on partners. In 2014 the goal is to scale from $5 billion in revenue to $10 billion.
"Expansions to our portfolio and the transitions in the market play to our sweet spot," he said, noting that his group has 100,000 customer sites in the U.S. The midmarket is defined as organizations with fewer than 1,000 employees.
He outlined several areas of opportunity including management, whether the workload is on premises or off premises; and white-space accounts (the company added 10,000 new accounts last year and this year, bifurcated its business into select business and emerging business based on prior spend and wallet share opportunity).
Sweeney then set some goals: to do a thousand deals above $50,000, to enter the first quarter with 20% of cloud-related sales, and to triple the amount of user computing business as the company enters 2015.
Moving forward, he said that he needs VMware partners to carry the company's message forward and figure out how to engage in those areas with customers. He also needs partners to drive hard on the vCloud Hybrid Service (vCHS).
Don Schleicher, vice president for the commercial sales segment, is responsible for 6,600 existing customers with 1,000 to 5,000 employees. His key focus in 2014 is threefold: to get existing customers and new customers to the vCloud Suite; to get the upper 25% of the segment to increase their investment, specifically in end-user computing and vCHS; and to increase the sale of point product solutions, such as Virtual SAN (VSAN), vCHS, and Desktone DaaS.
Partners drive 100% of sales and were responsible for 20% year-over-year growth last year, Schleicher noted. Going forward, he needs partners to focus on the management automation value elements for the customer in order to drive VCloud Suite sales. Schleicher also needs partners to rally around VSAN.
"Probably every partner has a SAN practice and VSAN would complement most of your businesses," he said.
The specialty panel speakers addressed the various VMware technologies that the company is promoting to partners.
Are partners in sync with VMware's message? Yes and no.
A few partners we spoke with agreed that the company didn't have much that was new to tout at this year's conference and that a lot of the software-defined enterprise is "pie in the sky" for their customers, who aren't in the big-business category.
"If you're a big enterprise or big data center -- East Coast or Silicon Valley -- SDDC makes sense. And that's the 15% of the business that goes direct to VMware that they didn't talk about. The 85% of channel business that they did talk about is not going to get a piece of that pie," said Steven D. Thraen, enterprise architect at QCM Technologies Inc. of Scottsdale, Ariz.
What Thraen did appreciate at PEX this year is the time he spent in management classes, which, he said, provided content he didn't get in the past. "I was real happy about that," he said. However, Thraen would like to see VMware lower the price on its management suites, which he believes would allow him to sell more product to SMB customers.
Peter Park, solutions architect, and Dean Flatland, cloud operations manager at Sayers, a boutique IT VAR located in Vernon Hills, Ill., were interested in learning more about VMware sponsors and what was new on the exhibition floor that they could take back to their customers. Sayers provides services around data center, infrastructure, security and mobility.
They would have liked to hear VMware talk about new features and capabilities in vSphere that would offer more stability. The partners, including Thraen, were all interested in hearing more details about VMware's acquisition of AirWatch, but it isn't a done deal yet.