VMware’s Tracy-Ann Palmer On How She Is Putting Partners In The Driver’s Seat

‘So we are leveraging the data very strategically to drive a profitability conversation around how do they make money and what are they optimizing versus what are they not optimizing. Don’t leave money on the table,’ Tracy-Ann Palmer, VMware’s vice president of partner experience, programs, investments and compliance, tells CRN.

VMware has tuned the car and given the channel the best engine and pit crew, but it is up to the partner to win the deal.

“The partner is in the driver’s seat,” said Tracy-Ann Palmer, VMware’s vice president of partner experience, programs, investments and compliance, who has overseen a massive transformation of VMware’s channel program that gives partners better business insight and higher profitability.

“So we are leveraging the data very strategically to drive a profitability conversation around how do they make money and what are they optimizing versus what are they not optimizing,” Palmer said. “Don’t leave money on the table.”

Speaking ahead of this week’s VMware Explore, Palmer walked CRN through VMware’s strategy behind the channel program changes and how it has set partners up to meet the multi-cloud moment, as well as positioned them for the arrival of generative AI.

Partners at the show told CRN they love the changes.

“I always like it when our vendors say I’m not going to be the roadblock. I don’t consider it their responsibility to be the driving force for us. I view it as their job is to get out of the way,” said Michael Bullough, a senior systems engineer with VMware partner CompuNet, based in Meridian, Idaho, but with offices across the U.S. “That’s all they need to do. They’re not here to hold our hand and do our job for us.”

Arne Olsson, sales manager for enterprise at 12-year VMware partner Real Time Services in Sweden, a 200-employee VMware Pinnacle partner, said the new program has been good at shifting his shop into advanced lines of business around app development.

“The new program has been good,” he told CRN at the show. “Now we are driving the Tanzu products hard to build up application development. The last year it has been very good. For us Tanzu is a very big opportunity. VMware is always the enabler. They built parts in everything, so of course if something new comes along, there will be a VMware option too.”

Palmer’s message to partners is the bigger the deal, the bigger the reward.

“A partner today who brings in a multimillion-dollar deal in ACV can make 2.5X more on the deal than they used to make,” Palmer said. “We’re not talking small numbers. We’re talking big numbers.”

Here are five questions from Palmer’s chat with CRN ahead of VMware Explore:

You put a lot of work into making sure partners have insight into their business with VMware, to help them make better decisions and strategies. Has that paid off?

We put in these ‘visibility machines,’ call it what you want, within the framework where we now give them predictability and visibility into two main areas. One, how do they make money? What is their compensation plan? And going back to those points of analysis, how can they monetize? How are they optimizing? What are they not optimizing? What do they need to tweak to make more money?

And I’m going to give you an example. I go to all of our strategic partners, dating back to FY20. I showed them all the components of monetization that we have given them at their disposal. We went through them, line by line, of what did they get to optimize? What are they optimizing? What are they leveraging? What are they not de-leveraging? How do we build that into their plan? Don’t leave money on the table, right?

The numbers have completely shifted. So we are leveraging the data very strategically to drive a profitability conversation around how do they make money and what are they optimizing versus what are they not optimizing.

The second piece on the data side is giving them customer information that they can leverage. So if you think about access to customer usage information, for instance, how do they optimize the customer spend? You have to have that in a cloud environment otherwise it doesn’t work.

So two big, big pieces. They have access to data 24x7 on their predictability, what they’re optimizing, so that they can put the strategic targets in place for their sales teams, putting the accelerators in place, everything they have to do on their own to make sure that we’re using that, and then the customer usage piece.

How has that performed since you put it in place?

So let’s just go through some of those metrics because this is where, sort of, the rubber starts to meet the road.

Here’s the way we look at all the activities that our services partners would drive. Technical assessment, which would be discovery, deployment. The areas where we want to drive SaaS, but we know we really want partners to double down and invest in.

We don’t just incent them on the front end. We say we’re going to give you something on the front end to do the work, but if you get the booking we’re going to give you more.

That conversion to booking used to be 25 percent. It’s 45 percent. Channel is without a doubt proving itself 100 percent. It’s those deals where partners are actually doing the discovery.

Where do partners see the value in continuing to work with VMware?

I would say first of all, multi-cloud 100 percent. In our channel ecosystem, over 70 percent of the bookings are in multi-cloud. High. It’s the biggest opportunity because here’s the thing: Customers didn’t choose a multi-cloud complex environment. They didn’t choose that.

The DevOps guys went and got Google, someone else went and got AWS. Right? The IT guys are sitting there with private infrastructure and data centers and everything.

Then they look back and they say, ‘We’re spending too much money and we’ve got all these different clouds and we don’t have all the expertise.’ Which is why managed services is taking off. There’s going to be a massive growth and consolidation in managed services in the next five years.

The small folks too, or do you mean larger solution providers?

The Rackspaces, the Lumens. But customers are saying, ‘Our environments have become complex. We don’t have all the expertise, and we don’t have all the talent and it’s costing us a lot of money.’ Right? So they’re sort of pushing partners to take a much more valuable role and support, but they also need to rationalize that environment as well.

On the new products being unveiled at Explore, there’s probably a lot to go over but I was wondering if you could talk about how partners should be looking at these in terms of positioning to their customers.

If you think about it, the cost of data. In a public environment, any kind of cloud environment, the most expensive thing in a cloud environment is data storage.. Our value proposition out way back has been around private cloud infrastructure.

And where do you want to store your data? When it’s proprietary you don’t want anybody getting their hands on it. Two. It costs too much in a public cloud environment. So the reason that we’ve become so valuable in that customer conversation is because of our private cloud capability.

AI is a massive, massive disrupter. Customers are still trying to figure out how to monetize that. That is the next thing that will happen. But customers are going to want to leverage private cloud infrastructure for all of their AI. Because, one, they don’t want anyone getting their hands on it and two, they want to make sure that they don’t have those high burdensome costs, which is what’s happening in the market right now.

There is a rationalization of cloud because the costs have gotten very, very high and a lot of that is because you’ve got multi-cloud environments, so you’re not paying for one. I mean, most customers have a minimum of two public clouds in their environment.