Microsoft Exec Shift Could Spell More Enterprise MBS Sales

Partners and others reading the tea leaves say the recent appointment of Dan English as MBS general manager within the company's Small and Midmarket Solutions and Partners group shows that the company is serious about entrenching Microsoft CRM, Axapta, Navision, Great Plains et al. in the largest of enterprises.

For years, English was Microsoft's point man with Large Account Resellers (LARs). This select handful of companies including the old Corporate Software, Software Spectrum, ASAP Software Express, and Software House International initially sold volume licenses of Microsoft software to big companies. More recently, Microsoft started negotiating terms of those enterprise licenses directly with the corporate customers and then referred them to LARs for services built on their licensing and software asset management expertise. (See related story.)

A Microsoft spokesman confirmed that English has moved on to new duties within SMS&P but stressed that his focus within MBS will be on small- and mid-market customers. (see story.)

English, along with a full slate of executives including CEO Steve Ballmer will be out in force at next week's "Velocity" Microsoft Worldwide Partners Conference in Toronto.

There have been mixed messages from Microsoft about its enterprise applications game plan. With regard to the U.S. Government vs. Oracle antitrust case, Microsoft representatives have said the company does not intend to be an enterprise applications player on par with PeopleSoft, SAP, and Oracle itself. That argument counters Oracle's claim that Microsoft has big-time plans for enteprise applications and thus the category would remain tightly contested even if Oracle succeeds in its hostile buyout of PeopleSoft.

But elsewhere Microsoft executives have parsed their language carefully in addressing MBS' potential role in large accounts. MBS' new COO Orlando Ayala has said repeatedly that MBS applications will find a home in the "spoke" of hub-and-spoke corporate configurations where geographically dispersed offices may have their own applications linking back into headquarters' back-end systems.

By putting English, with his enterprise channel contacts, into MBS, the company has set up a scenario that could boost MBS sales into bigger companies, several partners said.

"Dan is well positioned politically to continue Microsoft's process of mainlining MBS and doing whatever it takes to drive the business forward," said one MBS channel executive.

"I'm not saying his only job is to put MBS apps into big companies, but I'm saying the net effect of him being in that job will help do that," this source said.

In his new role, English reports to Darren Huston, corporate vice president of SMS&P for Microsoft.

Many who know English say he is a good choice for this role. "Dan is someone who understands how to leverage the Microsoft brand as well as its strengths and also how to encourage support, and develop scaled channel model. If you look what happened in the LAR area, Dan English was heavily involved in that process of developing scaled enterprise, for rapid growth," says Dan Duffy, CEO of ePartners, a Dallas-based MBS and Microsoft classic partner.

The issue of MBS sales and the channels that will facilitate them continues to be a hot button with Microsoft and its partners. Currently, the only MBS product selling through volume licenses (and thus fulfilled via LARs) is Microsoft CRM.

Microsoft's decision to open up that distribution beyond MBS authorized solution providers last year sparked a firestorm. Now the fear among MBS partners is that the rest of the MBS portfolio will follow CRM into wider distribution. Microsoft executives, from Ayala and Microsoft senior vice president Doug Burgum have assured partners that this will not happen and recently extended ERP partner contracts to two years for MBS partners.

But some in the channel are lobbying for Microsoft to reconsider this. They say some creative thinking is necessary to boost MBS sales to the achieve the volume goals Microsoft dearly wants and needs. Microsoft insiders say privately that MBS sales have been somewhat disappointing. Publicly, they say they are "on plan." Some channel players maintain that the dividing line between volume license products"Windows, Office and CRM vs. the ERP lineup is not necessarily natural.

"If I'm in an enterprise selling MBS products, it does not seem to be a big step for me to be helping [customers] with their Enterprise Agreements as well," said one MBS partner in the Midwest.

He and other MBS partners chafe at the notion that they should source any product through LARs when they say they could do that, as well as provide licensing and asset management services themselves.

The tension reflects the sometimes bitter conflict that erupts among the diverse channel players in Microsoft's partner lineup. Many solution providers resent sourcing product through distribution and LARs--and the margin hit that inflicts on them.

For better or worse, Microsoft must often mediate these battles and try to keep all the parties relatively happy.

That may prove to be one of English's biggest challenges in his new role, observers said.