SAP Channel Chief Kevin Gilroy: Partners Reaching Revenue Faster

SAP AG (SAP) Senior Vice President-Global Channels Kevin Gilroy told press and analysts at the SAP Americas Partner Leadership Summit in Hollywood, Fla., that partners are now on a path to quicker revenue.

According to Gilroy, it normally would take partners selling enterprise resource planning (ERP) around 36 months on average to see a reasonable return on investment (ROI)—breaking even, he said, would take 28 to 30 months. However, Gilroy said these numbers have decreased drastically, with partners on average now seeing revenue after eight to nine months, depending on the product line.

He said the number drop was a result of SAP finding partners with the right evolving profile, which includes balancing resale and services, leveraging marketing know-how, delivering consistent demand generation cadence and leading cloud transformation.

There are, however, partners signing contracts in the channel and not helping themselves by hiring a sales team, pre-sales team or a demo team, he said.

SAP actually loses money by keeping those partners in its partner program, Gilroy noted. To avoid these partners, SAP has become more selective, picking partners with the greatest opportunity to succeed, while having the ability to extend SAP in the marketplace.

Partners must also fit a certain risk profile. "We are looking for prudent, agressive risk," he said.

Finally, SAP is beginning to take a look at the balance sheet to find out if there is room for a partner to grow—a task the company is doing more often than it has in the past, he said.

Gilroy didn't say if the company would start dropping partners, but he did say SAP has been "calling partners out" if they're not where they should be.