IBM Think 2023: CEO Krishna Wants To Double Partner-Associated Revenue To 80 Percent
Wade Tyler Millward
‘The power of partnership is important to us. You have our commitment that we want to make you successful. As you become successful, your clients become successful and that means it’s a win-win-win,’ says IBM CEO Arvind Krishna.
IBM Chairman and CEO Arvind Krishna revealed during the vendor’s annual Think conference that recent investments in its partner program have grown the percent of “revenue associated with the ecosystem” from about 15 percent to about 40 percent—and he wants that number to double to about 80 percent.
And when asked by CRN about the Armonk, N.Y.-based vendor’s investment in the channel, Krishna told a room of analysts and reporters that within that 40 percent, about 20 percent is “fully autonomous,” meaning a partner can fully handle a customer without any help from IBM. He wants that number to eventually reach 50 percent.
“To make that happen is why [we’ve made] investments in the channel and why we want to go there and why we have doubled the number of people [at IBM] … who are only going to help the channel, meaning make the channel autonomous,” Krishna said in response to CRN’s question Tuesday. “Now, that’s a five-year bet. That’s not a six-month bet. We’re staying the course, and we’ll make it happen.”
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IBM CEO Krishna On Partners
Krishna’s comments come during Think 2023, a gathering of about 4,000 business and technology leaders that runs through Thursday in Orlando, Fla..
For the first time, IBM held a Partner Plus Day for content geared toward about 750 partners in attendance. Krishna also spoke during that event Monday.
IBM has about 55,000 worldwide channel partners, 12,000 of them in North America, according to CRN’s 2023 Channel Chiefs.
During Tuesday’s event, Krishna explained that investing in the channel is critical to IBM. While a vendor can possibly handle thousands of customers with direct sellers, it would need a sales force of around 500,000 people—not to mention manpower to get the product up and running—to eventually reach 100,000 customers. The vendor would also need time before getting a return on that investment.
“If you’re going that deep, I think it’s much better, as a win-win, to let the channel do that,” he said. “That’s what drives it for me.”
Krishna also described a more intentional approach to what products receive the resources channel partners need to go to market. A product that would ultimately benefit few customers, for example, is likely not going to interest partners, he said.
“Not everything in our portfolio is good for the channel,” Krishna said. “And that’s part of the mistakes we’ve made in the past.”
He said that at this moment, IBM is putting resources into about 15 products with simple packaging, pricing and deployment that would benefit from a strong channel sales motion.
In an interview with CRN, IBM Vice President of Global Partner Sales Todd Grube said that some of those products include:
*IBM Planning Analytics business performance management software
*Envizi, an environmental performance management data and analytics software offering IBM acquired last year
*The Maximo suite of asset monitoring, management and maintenance applications
*The QRadar set of threat detection and response offerings
Notably, some of these products are among the earliest of IBM’s to become available on Amazon Web Services’ Marketplace.
Krishna told the crowd Tuesday he expects the number of channel-friendly products “to grow, but it should not go to the hundreds because that would be too much.”
Speaking At Partner Plus Day
During his talk at Partner Plus Day, Krishna restated his commitment to the channel.
“The power of partnership is important to us,” he said. “You have our commitment that we want to make you successful. As you become successful, your clients become successful and that means it’s a win-win-win.”
IBM’s recent revamping of its program from PartnerWorld to Partner Plus was “the single largest change we have made to our partner program in my memory” as a 30-plus year IBM veteran, he said.
The vendor’s goal is to be “the easiest partner for you all to work with,” with partners now having access to the same training as IBM employees and a simplification in how to work with the partner program.
Although the vendor has grown its ecosystem-associated revenue from 15 percent to 40 percent, Krishna called the partner program boosting effort “a two-year journey.”
“We are half the absolute that we should be. … If I look at the next two to five years, I’d like us to double and aggregate together,” he said. “And we’re willing to keep investing to do that. Our hope is that you want to come along with us and be our trusted partner to bring all this to our clients as we go down this path.”