Consistency is the big strategic theme this year, following a massive restructuring a year ago, but Microsoft still had a to-do list for partners for the year ahead.
Today, at a joint conference of Microsoft’s Worldwide partners and their internal sales people at Microsoft Inspire in Las Vegas, the company set out its agenda for the year ahead, providing a general overview of their strategy and a glimpse of their plans to execute that story – since more detail on those plans is slated for tomorrow’s keynote. Following a year of great change last year, with the Microsoft One Commercial Partner model, the message this year was much more about consistency and fine tuning – with a lot of breast-beating over the first three quarters of what the company hinted is going to be an extremely strong year.
“We have united Microsoft sales reps and Microsoft partners this year for the first time,” said Gavriella Schuster, Corporate Vice President, One Commercial Partner. “We will learn together and plan together to get us off to the fastest start of a fiscal year that we have ever had… We need to lean on each other and learn from each other more than we ever have before.”
Schuster started her keynote with a Microsoft World Cup game, measuring the results of the 32 participating countries with a score based on the growth in customer wins. While both real-life finalists France and Croatia made it to the Final Eight before dropping out, the winner was Morocco, with a 162 per cent growth in customer wins. 30 of the 32 countries in this sample had over double-digit growth in both overall growth and customer wins. Microsoft’s game reflected a strong FY18, based on the first three quarters.
“FY18 might be a little hard to beat,” Schuster said. “We had an incredible year, in the first three quarters. “We saw 42 per cent growth in Office 365, 65 per cent in Dynamics 365, 93 per cent in Azure, and 234 per cent in Cloud Solution Provider revenue growth. We now have over 135 million active seats of Office 365.” More than three million leaders were delivered to partners, and more than 400,000 individuals were trained on cloud competencies over the past year.”
Judson Althoff, EVP Worldwide Commercial Business at Microsoft, continued this theme, as it related to the changes to the Microsoft commercial model implemented last year.
“There has never been a better time to be a Microsoft partner,” Althoff told the audience. “FY18 was a landmark year for us. We executed more change than the company has ever seen. We put the customer at the centre, and focused on putting the right resource in front of the right customer at the right time. The new commercial model that we implemented in resonating. It increased our focus on our industry strategy, and it is our partners who bring forward the differentiation that we need to bring this to life.
“The crown jewels of this commercial model is the Microsoft ONE commercial program,” Althoff stressed. “Because of it, we now have 5x as many solutions today, compared to a year ago. We then took those solutions to market, which resulted in tens of thousands of wins. This commercial model is resonating.”
Althoff said that the new model better fits the needs of a market and economy based on digital transformation.
“It’s not about selling product any more,” he said. “It’s using cloud services to transform their business. This new wave of compute – the intelligent cloud and the intelligent edge – will shape everything we do for decades to come. This is your opportunity. This will create more opportunities for the Microsoft ecosystem than we have seen in our history. It’s not some science future story. It’s here and it’s now.”
Althoff then turned to outlining the FY19 vision, strategy and plan for execution.
The core vision remains what it has been for years – empower every person and organization on the planet to achieve more. The overall strategy in terms of Microsoft’s solution area focus [gaming, modern life, modern workplace, business applications, applications and infrastructure, and data and AI] also remains consistent. Althoff stressed, however, how these have been infused by the focus now on digital transformation. He conducted an extended customer analysis segment with both the CIO and chief brewmaster of beer-maker Carlsberg, using multiple vignettes to demonstrate how Carlsberg is now using technology to drive digital transformation. For instance, the Carlsberg executives explained how the patterns that they see in the data now allow them to predict how the beer will taste.
“If you can optimize beer with AI, you can probably optimize any product on the planet,” Althoff stated.
Althoff also threw out some additional nuggets to the partner audience.
“Without a doubt, investing in a Dynamics 365 practice is the best way to invest more in Microsoft, and I would implore you to invest in that,” he said. He also pointed out that in Data and AI, which he termed his favorite area because of how it will shape compute going forward, partners have been taking their abilities and turn them into Cortana skills to facilitate AI-driven data analysis for business execs with consumer simplicity.
For FY19, Althoff stressed that the theme is stability
“Our commercial business remains steadfast, he said. “There will be fine-tuning, but no major changes.”
He did, however, identify five priorities for the year ahead.
“First and foremost, we will accelerate our cultural transformation,” he said. “We think of our partners as an extension of Microsoft and a growth mindset culture is first and foremost.” That entails being obsessed with our customers, as well as diversity and inclusion.”
The second theme is getting even deeper into Microsoft enterprise accounts.
“We will double down on industry focus, and increase density of coverage by 40 per cent,” he said. “This means we need more and more ISV solutions, and more services practices.”
Customer acquisition is a third major theme.
“We will be investing heavily in account-based marketing to feed more leads,” he said. “We will create some new customer-only territories on the Microsoft cloud, and add specialists dedicated to them. We will also have a new incentive model to compensate our people and you for the hard work of acquiring new customers.”
The fourth priority is customer retention, following the old axiom that acquiring new customers doesn’t do that much good if you don’t keep them for the longer term.
“We are continuing to add resources so you can focus on this,” Althoff said.
Finally, Althoff said Microsoft will invest heavily in learning and readiness, to come back to the first theme, since you can’t effectively foster cultural transformation without teaching it effectively.
“We will have a brand new learning platform this year, which is being rolled out simultaneously both internally and to partners,” he said. “We will have a new cloud certification that will become live at Ignite. We will also do things to revolutionize role-based learning.”