New HPE Partner Ready Vantage Compensation: 10 Things Partners Need To Know

After five years of paying a 17 percent up-front rebate on GreenLake Flex custom deals, HPE is moving to a new model that pays more for IaaS and SaaS cloud services.

The HPE Channel And Partner Ecosystem Strategy: Three Strategic Initiatives

Hewlett Packard Enterprise Vice President of Worldwide Channel and Partner Ecosystem Simon Ewington said the channel and ecosystem strategy for the new Partner Ready Vantage—which goes into effect Nov. 1—is centered on three strategic initiatives: innovating and expanding, driving profitable growth, and delivering a best-in-class experience.

“We want to be the vendor of choice for driving edge, hybrid cloud and AI and we want to do that by increasing our relevance and in turn increasing our partners’ relevance in the market,” said Ewington.

HPE intends to deliver on three strategic initiatives by “enabling differentiation through expertise and a focus on being the sustainable vendor of choice,” said Ewington.

The first element to enable partners to “increase their relevancy through innovation” is continuing to drive “as-a-service business model evolution,” said Ewington.

“We want to continue this by enabling our traditional partners to evolve at their own pace, but we also want to attract new partner archectypes, so MSPs is a good example, which Partner Ready Vantage is very aligned to,” said Ewington. “And we are going to do that by developing and enabling more managed capabilities on the GreenLake platform that they need for their business.”

HPE is also focused on scaling through repeatability, said Ewington. “We can’t continue to scale the deployment of custom, as-a-service solutions in the way that we have,” he said. “We have been hugely successful but we have to shift toward simpler, more automated platform-based offers.”

Here are the 10 things partners need to know about the new HPE Partner Ready Vantage compensation changes.

A New GreenLake Compensation Model

Under the new HPE Partner Ready Vantage model, HPE is moving away from the 17 percent up-front rebate on GreenLake Flex custom on-premises deals that has been in place for the last five years.

In the U.S., HPE is also shifting the GreenLake compensation model from monthly to quarterly.

Under the new custom Flex model in enterprise accounts and below, partners will receive a 9 percent base incentive and a 5 percent new logo incentive that will be paid quarterly.

In addition, partners will receive an annual full fiscal year volume incentive of 3 percent for hitting five deals or more that will be paid at the end of the fiscal year.

The new payment model is in sharp contrast to the GreenLake Partner Ready model, which paid partners a straight-up 17 percent rebate on GreenLake deals generally within a 30-day period.

The new model is a shift away from the often-time-consuming and complex on-premises Flex capacity deals in which HPE estimates compute/storage/network capacity at about 70 percent to 80 percent and then builds in a buffer for customers. Those proposals require a complex calculation on each and every solution and can take from six months to a year or more to go from first conversation to proposal to implementation.

Instead, HPE is opting to pay more for repeatable IaaS and SaaS deals. “We can’t continue to scale the deployment of custom, as-a-service solutions in the way that we have,” said Ewington. “We have been hugely successful, but we have got to shift toward simpler, more automated platform-based offers.”

Paying More For IaaS And SaaS GreenLake Offers

HPE is paying partners more for IaaS and SaaS GreenLake offers in enterprise and below accounts with a 12 percent base incentive compared with the 9 percent base incentive for custom Flex GreenLake deals.

The IaaS and SaaS compensation also includes a 5 percent new logo incentive and a 3 percent annual rebate that will be paid on five deals or more at the end of the fiscal year.

The IaaS and SaaS base and new logo incentives will be based on total contract value and paid quarterly.

Among the IaaS and SaaS solutions that are eligible for the higher-margin payout are GreenLake for Private Cloud Business Edition, and backup and recovery services.

“We are focused on giving our partners the opportunity to earn more based on the value that they deliver and repeatability and focusing the ability to drive more of their own services, which is where the big opportunities for many partners are,” said Ewington. “They can earn a huge amount of money by driving their own margin-rich services.”

A New Top Account Model For Flex Custom GreenLake Solutions And IaaS/SaaS

Under the new top account custom Flex solutions model, partners will receive a 9 percent base incentive paid quarterly and a 3 percent annual volume rebate paid on five deals or more.

Under the prior model, partners would have received the full 17 percent up-front rebate paid generally within a 30-day period.

The new IaaS and SaaS model for top accounts for partners is a 12 percent base incentive paid quarterly and a 3 percent annual rebate for five deals or more.

HPE Partner Ready Vantage continues HPE’s focus on driving and rewarding partners where they are providing “incremental coverage” for HPE, said Ewington.

Simplifying Partner Compensation With A Single Global HPE Partner Ready Vantage Program

HPE Partner Ready Vantage is aimed at simplifying and enhancing partner compensation with a single global program, said Ewington.

“We want to simplify and enhance partner compensation, move towards one standardized program that aligns to our mantra of simple, predictable and profitable,” said Ewington.

HPE said the new quarterly payment GreenLake model in North America is in line with the rest-of-the-world model that HPE has had in place for more than a decade.

At the heart of the new HPE Partner Ready Vantage is a move to have more “value-based” and “segment-based” compensation, said Ewington. “A good example would be new logo acquisition, which we really recognize as a real value to us that partners deliver,” he said.

As for the segment focus for HPE Partner Ready Vantage, Ewington said HPE is driving compensation to focus “more where partners are driving coverage on our behalf,” he said, such as “commercial segments and below where we are relying more on the channel to drive that business on our behalf.”

“The partner community does an amazing job of being our extended family in the field and that will continue as we move into FY 2024 and beyond,” he said.

“We are genuinely super excited about the partner community, how they are embracing HPE Partner Ready Vantage, the opportunity they’ll have to drive enhanced margin opportunities and create a longer-term, more relevant sustainable business built with us for their customers.”

The Financial Impact On GreenLake Enterprise Partners

As to the financial impact on enterprise partners, which have done the most GreenLake deals, HPE Vice President of Worldwide Channel Partner Programs and Operations Jesse Chavez said HPE is currently working through the pro forma financial impact at this point.

“Each partner is different, of course, in the way that they have built their business as far as the pro forma,” he said. “So we are working with them through pro formas right now, but partners that we sit down with understand the program and how we are going to not only simplify it but make it standard across the world and understand their opportunity to make more money exists.”

In fact, Chavez said, the larger enterprise partners will be recognized for their ability to drive repeatable GreenLake business under the new compensation model.

Ewington, for his part, said the enterprise partners that have done the most GreenLake deals should have no concern with the changes. “It is exactly in line with the strategy,” he said.

“We’ve made those changes and we designed those changes in collaboration with a lot of our partners,” he said. “So for a good example we tested some of the changes at our Partner Advisory Board and we have been rolling out testing the concept over the last couple of months with partners as well.”

A ‘Best-In-Class’ Experience To Enable Partners To Sell More

HPE Partner Ready Vantage is focused on providing a “best-in-class experience that acts as an enabler” for partners to sell more, especially in the compute business, said Ewington.
The best-in-class experience includes changes in the compute business, said Ewington. “We’re really radically focused on how do we simplify our offers, how do we have high-velocity offers, programs aligned to the compute business and how do we simplify offerings in the market to get to a really truly frictionless experience to partners, but also for their partner sellers?” said Ewington.

The second best-in-class experience focus is on optimizing “process and policies” in contract and discount processes, said Ewington. “We really want to reduce or eliminate a lot of our back-end work completely,” said Ewington.

Finally, HPE wants to increase “standardization” around compensation and other areas like deal registration and new business opportunities.

“If we standardize, we can automate and if we can automate, we can then introduce AI to really deliver a best-in-class partner experience,” said Ewington.

Expanding Data Services And Storage Opportunities

HPE is stepping up its focus on data as-a-service and storage opportunities, said Ewington.

“We are going to focus on refreshing our installed base, installed base expansion through competitive attack and hunting,” said Ewington. “We are going to achieve that through increased partner enablement, particularly in the technical community.”

HPE has a new worldwide “speciality-led hunting” go-to-market model that puts in place HPE product experts in the field who specialize in storage and compute and are chartered with driving core solutions sales growth.

“This is going to help us to help partners to focus, to better compete, to grow and will be supported by the work of our marketing colleagues to drive awareness and preference and demand generation and all the great stuff that they have been doing in the last 12 months,” said Ewington.

New HPE Hybrid Cloud Enablement And Tools

With Partner Ready Vantage, HPE is providing new enablement, tools and resources for hybrid cloud as-a-service practices, said Chavez.

Among the tools HPE is providing through its Professional Services Center of Expertise is a rapid migration tool that reduces migration costs and time, he said.

“The rapid migration tool essentially does the orchestration from an end-to-end perspective on the workflows and really starts automating how you do the discovery and the assessments and then also automating the way you move the workloads over to GreenLake,” said Chavez. “It is something that we have not made available before to our partners. It is a tool that our services organization used. We are now building a hub under the Center of Expertise for professional services where partners will have access to these tools.”

The rapid migration tool is just the start of more tools that will be added over the next year, said Chavez. “That’s an example of where we are enabling partners to really build out more services where really the margin is at as we go forward,” he said. “We want to make sure they get rewarded for those things.”

Driving HPE Aruba Networking Partner Ready Vantage Solutions

HPE Aruba Networking is stepping up its effort to provide new resources, tools and training to help partners do practice-building around its offerings, said HPE Aruba Networking Senior Director of Worldwide Channel Partner Programs and Strategy Beth Jensen.

To that point, HPE Aruba Networking has new and expanded consulting services workshops and training designed to help partners develop “strong as-a-service business plans” and help them determine the most relevant Networking-as-a-Service or managed services offerings through Aruba Service Discovery Sessions, said Jensen.

The HPE Aruba Networking engagements are also available for solution providers with a focus on building out managed services capabilities, said Jensen. “The engagements are either self-guided or with a consultant one on one,” she said.

Within the next several weeks, HPE Aruba Networking is going to have a practice accelerator tool that will help partners assess the “strength and maturity” of their managed services practice, said Jensen. That will also include recommendations on how partners can optimize the service offerings that they deliver, she said.

HPE Aruba Networking has just launched a new business outcome selling webinar series, said Jensen. “Over the next year we are going to have many more sessions,” she said. “They will be targeting some of our key industries and how to drive business outcomes and value-based selling through these industries.”

HPE Aruba Networking has also been focused on launching a customer success partner life-cycle campaign designed to drive adoption of HPE Aruba Networking practices, said Jensen.

In addition, HPE Aruba is assigning partner success managers that work with partners to help throughout the customer life cycle so they “can leverage all our best practices, tools and methodologies to drive the exceptional customer experiences we are looking for,” said Jensen.

HPE Aruba Networking has been getting rave reviews from partners that have adopted the HPE Aruba Networking tools and resources.

“On professional services, we have been hearing that they really appreciate all of our IP and the high-touch support we are providing to help them monetize their own services and then on customer success, they have been really appreciating the strong support we have been providing to them throughout the life cycle to not only land, but adopt, expand and renew,” said Jensen.

HPE’s Partner Ready Program Remains In Place

HPE will continue to maintain its bread-and-butter reseller-focused Partner Ready program, which supports the majority of its partners today, said Chavez.

Partners can migrate to the HPE Partner Ready Vantage as-a-service program as they build up their as-a-service capabilities, said Chavez.

“We want to make sure that we can recognize [those partners] not only through their efforts and their expertise but highlighting those capabilities to our customers and to our field as we go forward.”

The Partner Ready Vantage as-a-service ecosystem model includes three tracks for partners: Build with Centers of Expertise focused on solutions development and technology validation; Sell with an as-a-service Center of Expertise; and Service with Centers of Expertise focused on customer success, managed services and professional services.

“We believe that any one of these tracks can actually support some of the business models that our partners are either organically building or going through acquisitions at the moment,” he said.

The Services Track Center of Expertise is critical as partners move to gain more margin by delivering their own services, said Chavez.

“Partners will be able to actually gain more margin by delivering their own services,” he said. “We’re going to enable them with the tools that we are going to make available to them.”