IBM partners encouraged to sell services to SMB

LAS VEGAS – In the information technology industry, communications is vital to success. But judging by the confused look on the faces of many resellers here this week for IBM Corp.’s annual partner conference, giving 5,200 attendees a Blackberry device for fetching agendas and networking was a mixed


To be fair, asking a rookie to learn how to operate a complex wireless unit quickly – even with the benefit of a cheat sheet and special classes – was asking a lot.

Fortunately, IBM had better success in getting out one of its two messages: Big Blue wants partners to concentrate on selling services and products to small and medium business, and to push the company’s ‘on demand’ strategy.

On the former, it announced a range of initiatives to appeal to partners and independent software vendors (ISVs) to get moving on these goals, some of which will be rolled out through the year. But there still appears to be – as one industry analyst here put it – some fog around the meaning of ‘on demand.’

One change that will appeal to Canadian VARs wasn’t revealed here but will be made shortly: Partners will be able resell products offered by IBM’s Global Services consulting division. That announcement is related to the recent appointment of Shannon O’Connor to develop programs for the small and medium business market. Details of the plan are still being worked out.

However, one of the big announcements made at the conference left this country out: IBM partners in the U.S. who resell IGS managed hosting services to small and mid-sized companies will be able to get up to a 100 per cent incentive increase above the existing program. It will be realized through an annuity throughout the term of the agreement and with a signing bonus.

Partners will also be able to resell a special IGS managed hosting service for medium-sized business “”to further boost business partners profitability potential,”” the company said. Businesses will have their choice of running applications on Windows, AIX, Linux or Sun Solaris operating systems. It will be branded under the IBM Express name.

“”I can’t see why we wouldn’t do that,”” Gary Isaacs, IBM’s director of business partners in Canada said in an interview, suggesting that like other programs that start first in the U.S., this would move north in three months.

Another significant announcement made here was the upcoming simplification of the company’s partner programs, which may make it easier for solution providers to become top ranked. Currently there are three levels, premier, advanced and member for each of four tracks: software, services, personal computing and developers. Resellers who wish a designation have to meet certain training and sales criteria, which differs within each track. But it means a company could be a ‘premier’ software reseller and an ‘advanced’ services provider. Also, the reseller couldn’t use training credits earned under the premier designation to be upgrade certification in the software section.

“”It gets confusing to customers,”” Isaacs said of the different designations. “”The implication is ‘you aren’t good on the other.'””

So next year the company will eliminate the tracks and simplify the criteria for attaining each level. The result will be a partner can use the training credits earned under The criteria will be announced in April.

“”This is huge,”” said Dan Hinchey, who owns three MicroAge franchises in Western Canada and is a member of the PartnerWorld advisory committee.

“”It’s really going to help IBM strengthen their business partners across multiple tracks.””

As for ISVs, the company said it will spend US$1 billion this year to become IBM partners. The money will in part go to help them port applications away from proprietary languages and tools like Microsoft’s C# and .Net to open standards like Java, as well as to help them build their applications on IBM middleware like WebSphere, DB2 and the Lotus family.

IBM said it has signed more than 30 ISVs to the program and want to double that this year.

Other announcements included:

An Innovation Centres Initiative, which brings under one umbrella three education, porting and testing facilities. The renamed Business Partner Innovation Centres are a merger of existing storage and software centres, of which there are an estimated 14 in Canada. Operated by partners, these centres showcase reseller solutions and services built on IBM hardware and software. IBM Innovation Centres are similar facilities operated by IBM, including one in Toronto. The manufacturer also has an online Virtual Innovation Centre knowledge portal for software resellers and ISVs, which emphasizes selling SMB solutions.

Also, IBM will be giving partners the ability to download IBM’s Signature Selling Method e-learning module. It’s hoped VARs will benefit by using the same sales methodology as the company’s staff.

As for the demand for on demand, IBM executives spent much time in both general and special sessions explaining, touting and honing the concept. Broadly, IBM uses it as a logo to mean its way of helping companies integrate applications and hardware to help them use their IT systems efficiently, either in-house or outsourced, with flexibility to meet changing needs.

But partners confess it doesn’t mean much to them or many of their customers. Even after Palmisano stressed defining it in his opening address partners were mixed on his success. “”It’s inconclusive,”” said Ross Salvo, president of Montreal-based SIA Service Information Access Inc. “”Nobody understands it, but nobody cares.””

“”Progress was made, but there’s still more that has to be done,”” said David Weglo, Ontario director of sales for the Ram Group.

Robert Sproule, managing partner of the Kenna Group, a Toronto sales and marketing ISV, said the firm uses IBM ‘on demand’ marketing material in its brochures, but its a concept his company doesn’t lead with.

“”It’s a complex message,”” admitted John Callies, IBM’s vice-president of marketing for e-business on demand, the man in charge of getting the message out who lead a session to help partners get it. “”I would like the message to be clearer . . . It takes a little education.””

In other words, to some degree there’s a failure to communicate.

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Howard Solomon
Howard Solomon
Currently a freelance writer. Former editor of and Computing Canada. An IT journalist since 1997, Howard has written for several of ITWC's sister publications, including Before arriving at ITWC he served as a staff reporter at the Calgary Herald and the Brampton (Ont.) Daily Times.

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