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Microsoft industry focus meets with channel approval

Microsoft is adopting an industry orientation that channel partners believe will mirror their go-to-market approaches and promote solution selling in areas such as IoT.

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Microsoft is organizing around industry lines as it seeks greater insight into its customers' businesses and will work with partners to coordinate vertical market offerings.

Judson Althoff, executive vice president of Worldwide Commercial Business at Microsoft, said the Microsoft industry initiative will focus on six vertical markets: financial services, retail, manufacturing, government, education and healthcare. "Customers are asking us to more deeply understand their business," Althoff said. "We are changing our model and changing how we go to market."

For example, Microsoft account teams will be organized along industry lines. The company has viewed customers according to size -- the number of seats in a given organization. The industry emphasis, however, goes beyond sales. Toni Townes-Whitley, corporate vice president of industry at Microsoft, said the industry model also spans marketing, business development and engineering.

She said Microsoft will use "solution maps" to assess a partner's offering against the line-of-business needs of its customers. The maps will include a reference architecture to demonstrate how Microsoft and partner technology fit together.

Microsoft is pursuing the industry focus as one of its initiatives for the company's 2018 fiscal year, which began July 1.

Wanted: Industry knowledge

Raju Chekuri, president and CEO of NetEnrich Inc., said a vertical market focus becomes necessary as cloud providers move upmarket from infrastructure as a service to platform as a service and software as a service. NetEnrich is a cloud and IT operations services company in San Jose, Calif., that partners with channel companies.

In addition, industry knowledge is also critical for companies like Microsoft that aim to change the way clients do business via digital transformation, Chekuri said.

"If they don't understand those verticals, it is hard to do that," he said.

We are looking for partners who have deep knowledge of those certain industries, where they truly understand the needs of the customers within those vertical markets.
Kati Quigleysenior director of partner marketing, Microsoft Partner Network

David Newbould, director of cloud services, Europe, at Tech Data Corp., a distributor based in Clearwater, Fla., said the Microsoft industry orientation is "music to my ears. What we see is a change away from the traditional selling motion around products toward selling a solution and that no longer fits the number-of-seats model."

Newbould pointed to the example of the internet of things, where solutions revolve around vertical markets such as retail and transportation and logistics.

Renee Bergeron, senior vice president of global cloud at Ingram Micro, said the distributor can identify with the Microsoft industry push.

"We are seeing it in our market ... We started specializing two years ago," Bergeron said, noting customers want technology providers to have some knowledge of their business.

Ingram Micro focuses on the healthcare, legal and finance, public sector and retail verticals.

"It's absolutely the right vision," Bergeron said of Microsoft's structuring around industries.

Microsoft: Industry focus influencing recruitment

The industry focus is also informing Microsoft's partner recruitment strategy.

"We are looking for partners who have deep knowledge of those certain industries, where they truly understand the needs of the customers within those vertical markets," said Kati Quigley, senior director of partner marketing at Microsoft Partner Network.

In addition, Microsoft will look for opportunities to connect partners with other partners so they can combine their resources to address customers' industry-specific requirements, she noted.

Quigley said Microsoft plans to build out a feature within its Partner Center portal to help partners find each other. That feature will be added in the next six months. In another move in that direction, the company recently launched MicrosoftPartnerCommunity.com, which lets partners post inquiries.

Next Steps

Gain insight into launching a channel business in the healthcare industry

Learn about the role of IoT in the food supply chain

Find out how to build cloud solutions geared toward particular industries

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Does the Microsoft industry focus give it any particular advantages in channel partnering?
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