Q&A: Microsoft Channel Chief Phil Sorgen Talks About Cloud Incentives, Surface, Windows XP


Phil Sorgen, who took over for Jon Roskill as corporate vice president of Microsoft's Worldwide Partner Group last August, has spent most of his 18-year career at the software giant in field sales leadership roles. In all of his various positions working for Microsoft subsidiaries, Sorgen has been responsible for the last mile of execution.

In an interview with CRN in late February, he talked about how this experience informs his current role as Microsoft channel chief. Following is a transcript from the interview.

CRN: What are you focusing on at the moment?

Social, mobility, big data and cloud. My No. 1 priority coming into this job was to start making sure the things we're doing are best positioning ourselves, with our partner ecosystem, to be successful in these four megatrends.

Second, we want to be a company that is easier to do business with. That means simplifying partnering with us, lowering the cost of partnering with us, and increasing the business value that you get from partnering with us. If we can do those three things well, that equals profitability for the channel.

Related: Microsoft Partners In Uproar Over Cloud Sales Commission Cuts]

[CRN: Microsoft made some changes to Office 365 cloud partner incentives earlier this year. Can you explain the rationale for that move?

Truth be told, we're a self-critical organization, and there is a learning in that. We used vehicles [to communicate the changes] that we felt would reach the partner community. We learned that we need a megaphone larger than that when we announce changes. We have to consistently announce as far out as we possibly can. Because if a single partner didn't know, then there's a gap.

As we make decisions going forward, one of the principles is going to be looking for opportunities to drive stability and consistency. The next question is, do stability and consistency get us and our partners where we need to be? If not, then we need to change, and communications are a part of that.

So we're definitely going to look at that through a filter of minimizing change -- where minimizing change is the best thing for us and our partners.

CRN: Are these kinds of moves something that partners are just going to have to get used to -- because of the different way Microsoft is going to market?

With cloud incentives, we take pride in having some of the richest in the industry, and we will continue to richly reward partners for the work they do in cloud. In fiscal 2013, cloud incentives grew from 9 percent of the total [of $2 billion in channel incentives] to 18 percent. We pay more incentives, on average, across Windows Azure, Office 365, Windows Intune and CRM Online than any other products.

With a partner ecosystem as broad as ours, which covers many different partner business models and solution areas, any single decision could thrill one partner and potentially cause pain to another partner. We have to make [like] we're transparent with our communications, and that we're always sharing the rationale for decisions.

CRN: Did the total incentives paid to partners grow? Are you actually paying partners more?

I'd call it pretty consistent. It has shifted, and we told partners we are going to incent more for the leading areas. So it's absolutely shifted. It's increased in dollars year-over-year because of the growth of the business.

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