Scott Dodds, general manager of Microsoft’s Small and Medium-Enterprise Solutions & Partner group (SMS&P), recently met with CRN editor Sara Driscoll to chat exclusively about the challenges facing the software giant, and how he intends to regionalise the UK.
Sara Driscoll: You’ve been six months in the role, how has it been so far?
Scott Dodds: I started in January and it is coming up to four years for me at Microsoft. Before this I ran the OEM business for Microsoft and before that I was at Acer.
My key interest in this industry is around the channel and partnering. The big attraction for me coming into this role was that I get much closer to the whole partner community.
Within SMS&P we have all the partner elements. We own everything for Microsoft, from the medium-sized business down.
SMS&P accounts for about 40-45 per cent of UK revenues. This will be growing significantly over the next few years and we’re looking to grow about 14-15 per cent in revenue terms this year.
Driscoll: What were your priorities when you landed the SMS&P role?
Dodds: My priority was seeing the partners. In my first 90 days, I visited more than 100 individual partners. This is the lifeblood of what we do – if they are not clear about what we’re doing we can’t help them to drive their business forward.
One of the things that came out of this was that partners need to know about our plans before our new year starts. So one of my key objectives was to get ourselves into a position, from a planning perspective, so we were ready to go out to the channel and explain where we are going in FY08 long before FY08 actually starts. This is a bit of a novelty for Microsoft – typically, we would get to the end of a year, take a big sigh of relief, then start to think about what we were going to do with partners the following year. We have spent the past three months working on this, to the point that we are holding a partner summit this week for our key distributors and VARs in the UK to let them know exactly what we are doing.
Driscoll: What are your plans for next year (Microsoft’s year begins on 1 July)?
Dodds: We have massive amounts of information for both customers and partners, but it is difficult to show exactly what we have on offer.
It is absolutely crucial that there is clarity about what we have to offer to SMEs and what they can get online from us; there is a wealth of information and services that need to be made a lot clearer to the customer and partner community.
Our other key focus this year will be about regions. Typically, Microsoft has focused on the UK as a market with the assumption that every company is similar; we have taken a one-size-fits-all approach.
We have had a Scottish office for a number of years and have built very good relationships with both the Scottish government and the partner community
We have learned that we can get a lot closer to both the customer and the partner by driving this kind of regional strategy. We want to develop this; for example, half the businesses in the Black Country don’t have a PC in their offices. So, if you take a very regional view on specific parts of the UK, their market is very different.
We’re working on skills and training, and on how we can leverage some of the community activities that go on in these regions – hooking up partners with the customer types.
Driscoll: How do you intend to divide up the country?
Dodds: We’re going through that now. I think it will be a conurbation strategy. Clearly, partners tend to gather around conurbations – whatever size they may be. Some of the remoter parts of the UK will be relatively small in terms of towns and cities, but there will still be that community flavour and there will still be specific issues that face that part of the country.
It will be pretty much technology agnostic. We’re going to be there talking about how they can drive their businesses harder and better by using IT. Only 18 per cent of UK businesses actually sell online, which is an incredibly small number. We need to find out why this is.
Driscoll: How are you going to divide up your partners to ensure you get the right coverage?
Dodds: We already have about 32,000 Microsoft Registered, Certified and Gold partners. The Gold partners default to the top end because they are the ones with the deepest skills in the products. We need to work out in the regions how we drive these local strategies, but this has to be driven by what the customers need.
We have our B central web site, which is dedicated to SMEs, and this will be developed a lot over the coming months into a more sophisticated system, with further access for customers. This goes back to my original task of making what we have online more available and more well-known to partners and customers.
Driscoll: How will you do this?
Dodds: One of the things we did when launching Vista and Office this year was roadshows. We went out there and got in front of a lot more people.
We did 99 per cent demonstration and one per cent slides. It went down a storm because we were able to communicate what this technology can do for customers – not just the technology, but showing off the business benefits. This proved to us that basic demonstrations of the technology were still massively in demand. We tend to forget that when you live with this it is second nature, but a lot of SMEs don’t have time to absorb it and use it, and find out what the latest and greatest things are.
Driscoll: How will your communications and marketing manifest themselves?
Dodds: We will never have enough resources to employ an account manager for every partner. We have a fast-growing tele-business organisation, so there is a lot of telephone-based account management, which is what most of our partner community needs.
We have to be very clear; when you try to promise everything and fail, you won’t get anywhere, particularly with the sophisticated channel companies out there.
We need to be clear about what the differentiation is between our partners. We need to understand where we are going to invest over the next year or two and where we need specific focus and skills. We have to be clear about our key themes and who we have at a regional level that can help us deliver this.
Driscoll: What is happening with your distribution strategy?
Dodds: It’s ongoing. The process is running through until July. I will be in touch with all the distributors individually and as a group, and we will continue to manage this process. Once we have all the data and feedback from all the activities we have been doing then we will announce it.
Driscoll: How likely is it that you will axe one of the broadliners?
Dodds: I have no view on what this means yet, because I haven’t seen all the information. I arrived half-way through the process, so I am still catching up with all of this.
Driscoll: How do you see distribution at the moment?
Dodds: Distribution is still a massive part of people’s business. I absolutely recognise there are things that only distribution can do to help support a broader channel that is just not manageable by any one vendor. There has to be very clear reasons why we have the distributors we have, which is based on a particular skills set, market and facilities. I think there is huge opportunity for distribution to grow with us.
Driscoll: What is the biggest opportunity for Microsoft and its channel?
Dodds: The uptake of Vista and Office. We have to help the partner community realise the opportunities open to them with the new products and help the market upgrade, based on business drivers.
Driscoll: What is the biggest challenge for Microsoft and its partners?
Dodds: Explaining the complexity in everything we have talked about. Not just explaining Microsoft, but all the technology we have and how it can be used to drive business, and relating this to customer problems. The number of companies that use technology strategically is very low. This is something we need to get out into the wider community.
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