Channel Partners Lash Out At Microsoft's Restructuring


Solution providers this week lashed out at Microsoft's sweeping restructuring as just one more sign of the software giant's channel disconnect as it moves to become a devices and services superpower.

Hailed by Microsoft CEO Steve Ballmer in a memo as a "far-reaching realignment" that will enable Microsoft to "innovate with greater speed, efficiency and capability in a fast-changing world," many partners instead see the move as a sign of just how far removed Microsoft has become from partners delivering solutions to small, midsize and large businesses. They characterized Microsoft in the "devices and services" era as a company short on both channel commitment and innovation.

"The way I describe Microsoft in one word is 'disconnected,' " said Majdi "Mike" Daher, CEO of Denali Advanced Integration, Redmond, Wash., No. 114 on CRN's Solution Provider 500 list with $180 million in sales.

"They are disconnected from their partners and even their customers," said Daher. "Ask Microsoft customers: How do they see the partnership with Microsoft? Everything is done in a vacuum at Microsoft. Everything is a knee-jerk reaction. I miss the Microsoft that innovated and created markets and invited us to participate with them rather than reacting and responding to what others are doing like Apple and Google. Most of their products now are a reaction to what someone else has created."

 

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Daher, who sent several members of his team to Microsoft's Worldwide Partner Conference, said he sympathizes with Microsoft employees in the channel sales trenches, who are trying to make a difference for partners. The problem, he said, is they have "no tools and no programs to really engage the partners the way they should. I don't blame them. I blame the people who created the programs."

The Microsoft restructuring announcement came on the last day of the software giant's annual partner conference, an event some partners say further raised their ire.

Fueling the flames at the partner conference was Microsoft COO Kevin Turner's invitation to partners to bring customers to Microsoft retail stores, where Surface tablets are sold direct. This came after the software giant angered partners one week before the conference with the surprise launch of the Microsoft Devices Program, which gave just 10 Microsoft LARs the ability to sell Surface. That amounts to less than 0.01 percent of Microsoft's North American partner base and an even smaller fraction of the company's 640,000 partners worldwide.

Under the restructuring, Turner remains responsible for "worldwide sales, field marketing, services, support and (Microsoft retail) stores as well as IT, licensing and commercial operations," according to Ballmer's memo.

Some partners see Turner's retail roots as part of the problem. Turner, a 19-year Walmart veteran who ended his career there as president of Walmart's Sam's Club before joining Microsoft in 2005, is leading the charge on a Microsoft retail store expansion. He told partners at the conference that Microsoft will grow its retail store footprint by the end of its fiscal year 2014 by 38 percent to 101 stores, up from 73 stores.

NEXT: The Continuing Surface Slight