VMware Partner Connect Now in Full Swing Worldwide
"This is the complete end state” of VMware’s channel program, per Tracy-Ann Palmer, and will hold for years.
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One of the most important points about VMware Partner Connect is that it simplifies how partners engage with the company.
All VMware partners, regardless of business model (and inclusive of more than one), now take part in a universal point system. As such, partners earn money and incentives across transactions, service delivery, capabilities and specializations. However partners go to market, they will earn rewards. Simply put, the more a partner invests in VMware, the more the partner stands to earn. (We go into the new tiers on the next slide.)
More than 90% of VMware partners have more than one business model, Palmer said. So, VMware now sees them as “holistic” across multiple domains, she said. This means offering incentives “based on the value that [partners are] providing to the customer.”
Those incentives apply during the pre- and post-sales cycles, as well as during the sale. They can add up quickly, too, especially if a partner has one more than one business model.
When it comes to the types of partners VMware is targeting, the focus has shifted from cloud, resell and services to:
• Solution Reseller: Resells VMware software and services
• Solution Services Provider: Offers services before and beyond the transaction, with emphasis on pre-sales advisory and post-sales lifecycle services
• Cloud Services Provider: Offers VMware-based cloud and managed services, including hybrid and multicloud, in various geographies
• Solution Builder: Embeds VMware technology within their software
VMware will pay 90% based on performance and 10% on capability by tier at each level — Community, Select, Advanced, Principal and Pinnacle, none of which have annual fees.
The capability requirements differ by number of points, level of participation and enrolled business model. This goes back to making more money the more a partner invests in VMware. Overall, the goal is to entice partners to sell more VMware platforms.
“For everything partners sell, we want to ensure we’re getting that deployment as quickly as possible because if a customer isn’t consuming, then no one’s making money,” Palmer said. “We’re very much focused on services, customer success and consumption.”
To do that, VMware is putting more emphasis on MSPs.
With VMware Partner Connect, VMware is embracing more services-centric partners, such as MSPs.
Of interest is that a number of so-called solution resellers are morphing into MSPs “because that is where the industry’s going, the market’s demanding and partners are seeing more areas of opportunity, and growth and profitability,” Palmer said.
And VMware is investing more money into those partners.
“We will be doubling down on partners going into managed services and providing more support there and capability and investment to help them,” Partner said.
Next, get into the weeds about compensation.
A significant aspect of VMware Partner Connect is that it pays partners for work across the entire customer life cycle.
After years of discussion, life-cycle compensation is growing more standard within the indirect channel. For example, Google Cloud later this year will start paying partners for the life cycle journey, too. But VMware ranks as one of the first cloud providers to act on the conversation. Much of the reason ties to the way customers buy SaaS as compared to one-time licenses. They do so on a recurring and regular basis, and this extends more opportunities for partners to deliver high-margin, repeatable sales.
There are 12 incentive programs, one of which, as an example, is called Sell. It’s a back-end rebate aligned to the partner’s program level.
“It is about rewarding for SaaS and subscription,” Palmer said. “You can earn two to 10 times versus your license bookings.”
Two other incentives are called Activate and Deployment. Activate pays partners for professional services work as customers use VMware Cross-Cloud services. Deployment rewards partners for selling more, select VMware platforms tied to application modernization and multicloud.
VMware Partner Connect features a new incentives historical tracker. The portal lets partners review their total payouts in previous quarters. That way, they know where to maximize profitability and identify potentially missed opportunities — or, as Palmer put it, “It shows money left on the table.”
Historically, VMware has not paid system integrators or consultants for their advisory services. With VMware Partner Connect, that’s changed. Partners who register as Solutions Services Providers now may earn performance points for influenced bookings, as VMware put it.
“They’re doing major digital transformation projects,” Palmer said.
Much of that effort encompasses pre-sales consulting and advanced services, she added. So, because of all that up-front work these partners do, VMware now will extend Influence Points, which equate to a bookings point (an amount VMware partners will know for their individual businesses, Palmer said).
As for other incentives, Partner-to-Partner remains in place. This is the SPIFF that pays partners to refer peers to do work on the same project.
VMware Partner Connect contains three more elements to support participants.
The first is the overhauled, customizable dashboard. Partners can track history, performance and progress.
The second is expanded practice development via VMware Ignite. Ignite underwrites partners activating and developing their VMware practices. It’s now available worldwide.
Finally, VMware Partner Connect now houses 14 competencies, including VMware Cloud on AWS; eight master services competencies, including one for cloud-native applications; and two specializations that validate skills beyond the technical.
Partners earn capability points toward program progression based on their investment in training, competencies and certifications.
As VMware Partner Connect rolls out across the globe, Palmer and her team are looking forward to the outcomes.
“This is the complete end state of Partner Connect,” she said. “It’s a unified partner experience that has the ability to meet our partners where they are today and support them … where they’re going to be tomorrow.”
Again, Palmer expects VMware Partner Connect “will hold for the next five to 10 years.”
Too often, companies upend their channel programs as they try to keep up with market shifts. This creates more upheaval for partners and can even cause a loss of faith in vendors.
VMware, though, seems to have crafted a structure that will withstand some time, even as partners can expect ongoing simplification, Palmer said.
“Absolutely we can evolve to the future and scale,” she said.
As VMware Partner Connect rolls out across the globe, Palmer and her team are looking forward to the outcomes.
“This is the complete end state of Partner Connect,” she said. “It’s a unified partner experience that has the ability to meet our partners where they are today and support them … where they’re going to be tomorrow.”
Again, Palmer expects VMware Partner Connect “will hold for the next five to 10 years.”
Too often, companies upend their channel programs as they try to keep up with market shifts. This creates more upheaval for partners and can even cause a loss of faith in vendors.
VMware, though, seems to have crafted a structure that will withstand some time, even as partners can expect ongoing simplification, Palmer said.
“Absolutely we can evolve to the future and scale,” she said.
The final phase of VMware Partner Connect is now in full swing worldwide. It’s an initiative that, according to one of its chief architects, should hold for the next five to 10 years.
VMware started revamping its partner program in 2020. That’s when the name went from Partner Network to Partner Connect. Throughout 2021 and 2022, VMware then focused on streamlining how partners interacted with the company. Despite improvements, some aspects remained difficult to navigate. But late last summer, VMware unveiled some details surrounding the last tweaks to Partner Connect that would take some time to fully implement — which the company now has done.
Tracy-Ann Palmer is vice president of global channel sales programs and compliance at VMware.
VMware’s Tracy-Ann Palmer
“The original Partner Connect started in 2020 … but the heavy, heavy lift has been over the last 12 months,” she said.
VMware’s Evolution
As VMware itself has evolved from a legacy hardware to software-as-a-service subscriptions focused on multicloud, it has brought its channel partners along for the ride. Resellers, systems integrators, managed service providers, consultants and other partners got a preview of VMware Partner Connect in August and have spent the intervening months preparing to operate in the new tiers.
“Our strategy is for every VMware partner to own the customer life cycle end to end, leading with services, partnering with others, and building predictable, recurring revenue streams,” Palmer said.
To be sure, VMware Partner Connect targets more partner types and pays for aspects of the customer life cycle journey where it historically has not. Steve White, vice president of channels and alliances at IDC, noted that VMware is on the right track.
“By bringing everything together under one VMware program with a more simplified experience, VMware can help partners transition to as-a-service/subscription models, expand their services portfolios, and better leverage their investments to the fullest,” he said.
Channel Futures sat down with Palmer, one of the key executives behind VMware Partner Connect, to go over the changes. See the slideshow above to find out what you need to know about the new channel program.
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