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Microsoft To Turn Up The Heat In Enterprise Services

Barbara Darrow

At a recent meeting with the company’s largest integrator partners, Microsoft executives said they would like to place one architect from Microsoft Consulting Services (MCS) in each of its top 2000 global accounts and one-third of an architect—as in three companies would share one—in the next-largest tier of accounts by the end of the decade.

Simon Witts, corporate vice president of Microsoft’s enterprise and partner group, said that indeed is the company’s aspiration, although it is far from clear whether it will hit those targets.

“This is all fee-based. We have to sell our way in,” Witts told CRN last week. “We dare to dream in the time frame you talked about to put one in every major account, but in reality there is no business plan for that yet,” Witts said.

Microsoft, Redmond, Wash., now has 300 MCS architects working in customer IT departments. “Yes, if we can, we want to sell an on-site architect to all of our major accounts. In reality, if we move from 300 to 1,000 [in that time frame] that would be great.”

The company also wants to place more Technical Account Managers, or TAMs, in the next tier of accounts through its Premier support option, Witts said.

“We’re doing two things. We’d like to increase the number of on-site architects through MCS as part of a multiyear consulting relationship. And, we want to increase TAMs that come through Premier services,” Witts said.

The next largest tier after the global 2000 accounts is some 8,000 or so major accounts, sometimes called CAS for Corporate Account Space.

“Majors will also get a dedicated or shared TAM depending on volume of business, but [Microsoft Services] would have to grow from 7,000 today to over 14,000 to make this work. Services will run at around 10 points over ‘cost,’ adding perhaps 1 percent to Microsoft revenue,” said one integrator who attended the event.

Microsoft estimates it accounts for 2 percent to 5 percent of total enterprise IT spending and wants to up that percentage to maybe 10 percent. The goal is to also grow partners’ share of that spend as fast or faster, this attendee said.

Some partners at the global partner summit two weeks ago said the plan as they perceived it would mean a substantial spike to Microsoft Services head count.

The company has about 7,100 services people overall including about 4,300 in MCS proper, 2,100 in Premier services and another 700 field engineers, a spokesman said. Some partners worry that a bulked-up services presence would lead to further struggles over account control and that Microsoft might try to supplant third-party integrators—even huge allies like HP Services, Accenture and others—in large accounts.

“They’ve already attempted to win account control. This is just another roadside bomb,” said one mid-Atlantic integrator. “They believe they own the accounts, and those of us who’ve done business with the customer for 25 years or so believe we own the accounts. So there’s a conflict there.”

Witts pushed back on that, saying that perception “depends on which partner you talk to. For big system integrators, we have no confusion that they have much more account control than we do. For smaller solution providers, it is true that our [account] relationship is strong but it shouldn’t be seen as a ‘who leads’ kind of thing. The more we drive the platform, the better it is for all,” he said.

Peter Rakoczy, general manager of worldwide MCS, concurred. “The customer tends to dictate who controls the account, and we all vie for the right to own the business. In general, the Premier presence with TAMs is viewed quite positively as a way to backstop and help with the platform so partners can focus on projects and engagements.”

Other integrators were sanguine. “We have our people on their [Microsoft’s] campus and they have their people on our campus. The goal is to work together better for the client,” said an executive with one of the national integration giants.

This executive also noted that Microsoft has long tried to tighten ties with enterprise customers but integrators are safe because “people want a vendor-agnostic view” as well as the vendor’s own take on their situation.

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