Q&A: Polycom Execs On Why Partner Opportunity In Collaboration Is At An All-Time High

Polycom's Partnership Progress

While Polycom traditionally has been known as a heavyweight player in the voice and videoconferencing space, the San Jose, Calif.-based company is pushing hard to get its partner community to embrace its collaboration and workflow offerings. Christopher Jones, president of Americas sales and the worldwide partner organization, and Nick Tidd, vice president of the global partner organization (l. to r.), said these areas present a significant runway of opportunity for current Polycom partners, as well as ways for new partners (especially those already engaged with Microsoft) to work with the vendor. CRN caught up with the two executives at the 2016 XChange Solution Provider event in Los Angeles. Following are excerpts of the discussion.

How is the Polycom strategy evolving?

Tidd: We had some significant product announcements in Q4. We have a tremendous brand in the channel, but we have not done a great job at communicating how strong we are in video and the opportunity around workflow and collaboration. … We're getting more into the video space and, more importantly, workflow and collaboration. We're beginning our quest of looking to actively recruit and on-board new partners. That's not necessarily a share shift within our existing partner infrastructure. It's more to complement. We believe there is a significant upside and opportunity for the partner community. We're going to be very active. … It's a pretty exciting opportunity.

How does that push into video, workflow and collaboration affect your approach to partnering?

Jones: If you take a look at our go-to-market model, it's close to 100 percent going through the partner community. I'm a big passionate believer in the idea that the only opportunity we have to scale our business is by building a collaborative partner ecosystem. We have a good running start there. At our Global Partner Summit this past year, there were really three pillars that we had laid out with our partner community: growth, focus and engagement. We had very good feedback with that.

How are you applying those pillars of growth, focus and engagement?

Jones: The growth aspect of things, we've come out with a whole new suite of products that have a tremendous opportunity to help partners both with hardware but also from a services standpoint. There's a growth trajectory there. The focus standpoint is working with our partners to identify with the solutions that we have in collaboration and video, to really take advantage of areas that we have an opportunity to help partners build core practices around. Engagement is all around how we go to market with partners. We want to make sure we have partner profitability built into everything we do. There are a lot of investments ... and a combination of not only doing more with fewer but also making sure that we have the right partners focused on the right markets that we're focused on.

Do most of your partners take advantage of your full ecosystem of solutions, or is it mostly segmented?

Tidd: We've got a cross-section. We have a lot of traditional AV partners that have been conference room build-outs and meeting room build-outs.

Talk about your new partnership with Microsoft around Skype for Business. What's the opportunity for partners there?

Tidd: We're a very strategic partner for them. Today's announcements centered around video capabilities in Skype for Business that had traditionally been a cloud-based offering. There's a tremendous opportunity for partners that have a Microsoft practice, that have collaboration practices. We're also seeing a change in what are commonly referred to as the interconnect partners – those folks who have been focused on call control and on-premise PBX-type technology. As we see this movement, there's definitely some void in some of the manufacturers that don’t have solid cloud offerings that we can absolutely complement. Then, there's also still your 95 percent of call control platforms that are still on-premise. There is a refresh cycle to that as well. What we've been focused on is collaboration and ease of connectivity in collaboration, which is a distinct competitive advantage for us.

How does this play into the transformation of the channel's perception of Polycom that we've been talking about?

Tidd: We do more than conference calls. … It's the proverbial I don't know what I don't know. For us the timing is very unique to look at segment expansion, as well as filling voids in the marketplace where we don't have good coverage. As we alluded to, the majority of our revenue is channel-based already. That includes a very high component of services revenue. We want to continue to build out on that with professional services revenue. In particular, to give you an example, one of our fantastic announcements in October was Centro, which is a center-of-the-room experience. Those small huddle rooms, of which there's estimated to be 50 million in the world, only 12 percent of them are video-enabled. There's a significant upside opportunity there for penetration. We're really presenting opportunities to the partner base on where they can complement existing practice, but also build out an existing practice.

Why Microsoft for the partnership?

Jones: Microsoft is now becoming a major disrupter in an area that they have traditionally not been: the area of UC and collaboration in general. This is an area that they haven't played [in], but the Skype for Business platform that they have now … where a lot of people might have looked at that as a small-business solution, they're now realizing there's lots of very large enterprises that are moving to the Skype for Business platform. That's opening up an entire new ecosystem and opportunity for partners that can go forth and help companies migrate to a Skype for Business type of platform. We just came out with some announcements that Microsoft [talked about] in their keynote the significant relationship they have with Polycom, where we become essentially the on-ramp for the Skype for Business service line. For partners, it represents a phenomenal opportunity to help companies drive the integration and provides them a significant services opportunity.

Have the partners already started taking advantage of this? Or is the opportunity early on?

Tidd: A little bit of both, but the acceptance of it has been tremendous. In particular, we're talking about the E5 version of Office 365 that was laid out in the latter part of December. Since then, we've been inundated with opportunities to partner with and partner through and to transfer knowledge to them because there's a subset of the partner base that's only done licensing or traditional call control. … There's a tremendous growth opportunity there. Microsoft is clearly going to be a disrupter as they come into this space that traditionally a customer would evaluate based on call flow and implementation, as opposed to how do I collaborate better with my enterprise and take advantage of presentation content? That is key.

Do you have an example of a partner already doing this?

Jones: I met with a partner yesterday at Enterprise Connect. This is what I call a traditional Microsoft partner who has built a significant practice around Skype for Business. They view the opportunity here, being able to pull together what they do with Microsoft with Polycom, as adding a tremendous amount of value to help them drive a whole different level of services into the enterprise. I think we're going to see it opening up a lot of really unique opportunities for the partner community.

I would imagine margins would be better by bringing the two together. Is that true?

Tidd: Do you remember the old adage? Where there is mystery, there's margin.

That's why it's exciting for us to be there. Folks have this preconceived notion that we do great voice handsets and great voice conferencing products, but what they don't realize is how focused we are on that workflow and collaboration. That's really going to be the message as we embark not only at XChange here, but as we lay out the strategy for the rest of the year with the channel companies.

What are the other areas where Polycom is evolving?

Jones: On the whole coverage aspect of things, when you take a look at what I would call the traditional legacy base of partners, who have been great partners for Polycom, there's a lot of change going on with respect to collaboration in general. One of the changes is, obviously, the move to a lot of cloud-based services and partner opportunities there. The other is, relative to the other types of markets with the broad new product portfolio that we introduced several months ago, we opened up the door to start getting into a lot of markets that we traditionally have not focused on. The midmarket and small business is an example. We need partners that can help us really take advantage of the opportunities there, of which huge percentages are looking for how do they further their collaboration. Areas where video had not traditionally played are now getting much more ubiquitous.

What factors do you see driving this changing approach to video and collaboration tools?

Jones: We like to think of it as the 'millennial challenge.' Millennials entering the workforce have an expectation on how they work. … It's an expectation by my kids on how they communicate. Greater than half of the millennials make decisions in groups and want to have the collaboration experience in order to do that with people, irrespective of where they are. It's creating a great opportunity for us and our partners.

What about the Trio platform? Can you give us an update on that?

Tidd: The third part of that strategy we announced earlier in the year is Trio, which is focused on collaboration. It's the next-gen conference platform. ... One of my subtle messages to the partner community is: How many times do you walk into a conference room and see a Starfish Polycom phone? That's a potential upgrade. There's a huge potential refresh capability. I think the important pieces that partners are evaluating are their on-board strategy, all of our training is Web-based, it's not a cumbersome product to seek authorization, it's a multitiered program based on profitability and the transfer of knowledge. There's some very unique markets that we can play vertically [in] as well as horizontally. We're pretty excited about the opportunity to get in front of the audience.