Microsoft to Spend as Much as $500 Million On New Channel Investments

Speaking here this week at the corporate headquarters of the world's largest software company, Orlando Ayala, group vice president of worldwide sales, marketing and services, said Microsoft needs new investments in order to reach familiar short-term goals, such as revenue growth, but also a raft of newer objectives that have only recently come to light. These aspirations include becoming more predictable, improving partner and customer satisfaction, increasing penetration in key market segments and reigniting the passion of employees and partners alike for small and midsize businesses. Though all of these objectives are more difficult to attain or even measure, they are nonetheless vital to the new Microsoft, Ayala says.

"I like to believe that the company [in the past decade has been perceived as an innovator in terms of channel programs," Ayala says. "We absolutely need to be sure that we keep innovating."

Although complete details of new channel investments won't be released until July--when Microsoft hosts its annual Fusion conference for business partners,the company this week hinted at what partners can expect. Among other things, Microsoft will hire hundreds of new partner account managers to improve communication in the field, provide rewards or incentives to partners who help drive sales of certain products or drive revenue into certain markets, and devote greater resources so that it may provide better support to its community of partners.

"We're investing in a lot of new headcount, including partner managers," Ayala says. "I felt that we were not at the level we needed to be."

Microsoft is also strengthening its channel leadership around the world and allocating more senior people run its various programs and initiatives. Ayala notes that in the United Kingdom, one of Microsoft's strongest employees in the region has now been assigned to oversee partner efforts. Furthermore, Allison Watson will step into the role of vice president of worldwide partner sales and marketing. Ayala says Watson will effectively become the new channels chief, following Rosa Garcia, who is moving on to run Microsoft Spain. One thing significant about the change: Watson has the title of vice president instead of general manager--a step up in the Microsoft internal corporate hierarchy.

These and other efforts will help Microsoft "get back in the channel game," Ayala says.