Simplification top priority in Avaya channel program changes

Avaya has announced alterations to the Edge partner program it first rolled out two years ago, to remove some pain points, and which provides partners with more compensation than before, but which is distributed differently.

John Colvin, head of Global Partner Marketing at Avaya

Avaya has made changes to its Edge channel partner program, which the company introduced in late 2016 to support the restructuring of its business from a formerly hardware-centric model to one based on software and increasingly, the cloud. The dominant theme is one of simplification, to further encourage sales of cloud solutions.

“The changes build on the momentum that the program built up in 2018,” said John Colvin, head of Global Partner Marketing at Avaya. “We spent a lot of time with partners, getting feedback on what worked in the program – and what didn’t work. The enhancements are all about rewarding growth and modernization, to encourage partners to grow their business by modernizing their base, and driving to the cloud. We hope that they will stimulate additional cloud sales.”

Colvin cited the change in the structure of the program from running parallel with Avaya’s fiscal year, which runs from October 1 to September 30, to the calendar year, as an example of a response to partner feedback.

“This sounds like a small issue, but we found that it was something that was very important to partners,” Colvin said. “They wanted the program to run with the calendar year, to better align with their own businesses, so we changed the timing of the program, and have moved the start date to January 1.”

Another partner concern was that parts of the program were too complex, which made it too difficult for them to easily link actions to payouts. The changes have not only simplified the programs but also how it trains partners on them, to make cause and effect as clear as possible.

“For example, the rebate system used to be very complex, with separate structures for multiple categories like integrators and specialists,” Colvin said. “We have eliminated that, taking away complexity to make the process simpler for the partner to understand.” That sees the structure of possible commissions simplified from 126 possible options to 9. That not only makes the commissions more predictable, but it also removed a retroactive performance evaluation that included a manual appeals process, and which partners found to be painful.

“We had so many buckets before, and now it’s much easier for partners to understand and act on,” Colvin indicated. “The new structure rewards partners by providing them with more benefits as they sell more. There are gates that trigger additional benefits, rather than quotas that need to be met. It’s all about selling seats in UCC services and cloud. That’s really it, and there are additional rebates for things like driving net-new logos and getting new deals registered in the system.”

The result is a more levelled system of rewards across Avaya’s partner tiers, which has separate levels for integrators and for Diamond, Sapphire and Emerald partners, with the latter being a flashier equivalent of the old industry-standard Gold, Silver and Bronze metallics. Avaya is touting this as providing equal growth opportunities to partner of any size.

“We give everyone the opportunity,” Colvin said. “You don’t get a bigger rebate payout because of the tier. Diamond sells more than Sapphire and Emerald, so they will make more dollars that way.”

Colvin said that the rationale for the change has already been explained to the larger partners, and Avaya isn’t expecting any grumbling from them about the new system.

“We have spent a lot of time explaining this, so this won’t come as a surprise to them,” he noted. “We have sat down and done the math with them. It’s all based on growth. There are actually more dollars available now in this system then under the old one, but its based on growth levers, on growth as a percentage of their business year over year. The more you grow, the more you get.”

There are also now significantly more rebate dollars for selling net new Avaya Unified Communications or Contact Centre solutions, and a program has been put in place, Avaya Loyalty2gether, designed to encourage migration from legacy communications hardware to new solutions. This has been a thorn in Avaya’s side for years, as customers have been understandably reluctant to ditch old Nortel PBX systems that just keep on humming along, despite entreaties from Avaya and their partners that the new UC and CC offerings can provide them with much more. The new program rewards partners for migrating this base to the newer technologies.

“We kicked off this campaign in spring of 2018 with a  program to incentivize customers off the old hardware and move to a modern hybrid or pure cloud solution, or even on-prem in real cases,” Colvin indicated.  “We could almost match the cost of what they were paying in maintenance to move them into the cloud. We have now end-of-lifed these products, although they are not yet close to the end of service.”

Avaya continues to manage its channel programs on a regional basis, in contrast to most channel vendors of their size, and their own past policies. Since  the departure of their last global channel chief in 2017, they have run their channel operations on their three separate regional management organizations. One covers EMEA and Asia Pacific, one covers the U.S., and the third is responsible for Latin America and Canada. Gary Levy runs the channel business in the U.S., while Santiago Aguirre handles Canada and Latin America.

The channel changes will be front and centre at the upcoming Avaya Engage event, the company’s annual user group conference, which is taking place in Austin TX from January 20 to January 23, with the Partner Forum taking place on January 21.