SAP hails progress of SMB channel push

Business applications giant looks to shatter end users' misconceptions that it is an enterprise-only vendor

Business applications giant SAP claims it is on course to be 100 per cent channel only in the SMB market by the end of the year.

The vendor vowed to stop selling direct to SMBs in February and that all deals in that market would be transacted via the channel by the end of 2011.

In the same month, the vendor appointed John Antunes as director of SME and channels to oversee its downstream channel push in the UK and Ireland.

Speaking to ChannelWeb, Antunes said the firm was on course to achieve its indirect goal, thanks to an organisational overhaul during the first three months of the year.

"We realigned the whole organisation in Q1 so that our original direct sales force, which we now refer to as the high-touch team, started to support partners in closing deals on SAP," he said.

The shift has already resulted in partners winning more business in the SMB market, thanks to the lead generation efforts of its internal sales force.

"The direct team still continues to hunt for new business and leads, but the difference is, when they uncover new prospects they engage with a partner to deliver on it," Antunes explained.

"I think it's a key differentiator as not many of our competitors would be prepared to put a direct sales force behind the channel."

Channel change

The transition from direct to indirect was not an easy one for some of the firm's internal sales teams to get to grips with, he admitted.

"It was not easy from the perspective that we needed to move from this kind of competitive environment to a collaborative one," he said.

"That said, the team have embraced it since we engaged with them at the back end of last year about the business plan for 2011."

Even if there had been resistance, ramping up its channel activities to secure a large slice of the SMEs' IT spend would still have been a priority for the vendor.

"There are 1.5 million SMEs in the UK and Ireland and the only way for a business to successfully scale into that area is through a partner channel," explained Antunes.

"I do not believe we would ever be able to reach that volume of SMEs without the channel's help."

Looking ahead

Antunes revealed that the next part of SAP's SMB strategy will involve altering end-user perceptions about the firm being enterprise only.

"This year, there will be a big drive from us to bust some myths and make SMEs appreciate that SAP is not too big, expensive and complex for them," he said.

"I do not think it's a big barrier [to SAP's growth] and it is certainly not insurmountable, but these are definitely misconceptions that we need to change."

The channel will have a role to play in this, in terms of educating the marketplace about SAP's product portfolio and the business challenges it can help SMEs solve, he added.

"The channel will be the face of SAP to the SME market and partners will have an absolutely critical role to play," concluded Antunes. "This year you can expect to see a lot more focus from SAP in supporting the channel to educate the wider market."