SAP Reaches $1B in Channel Revenue

Troy Richardson, SVP of SAP's North American Ecosystems and Channels group

, SVP of ’s North American Ecosystems and Channels group

Enterprise software giant SAP AG crossed the $1 billion mark in partner-driven revenue for the first time in 2012, with channel sales growing 86 percent year-over-year.

It’s part of what Troy Richardson, the company’s new senior vice president and general manager of its North American ecosystems group, called the biggest year ever for the company’s channel community, one that saw the channel group beat its plan by nearly 40 percent.

The company has been focused on building its channel community in recent years. SAP has set a goal of reaching one billion people (and $20 billion in revenues) by 2015, which means expanding its presence in is a must. After a few missteps in reaching that audience, it has built its presence in the space by building its partner network, a charge led by longtime channel veteran , now the company’s senior vice president of global channels.

SAP has stated it intends to get to the point of doing 40 percent of its business through channel partners by 2015. Gilroy said that in North America, the percentage of indirect business is at around 33 percent and is “on track” to meet the 2015 goal.

“Our channel will grow faster than SAP in 2013,” Gilroy predicted.

Richardson, new to the role of North American channel chief, said he has four priorities to make sure that growth materializes.

He said the company is making SMB customers under $1 billion the exclusive domain of its partners, and is emphasizing on getting partners trained on the breadth and depth of the company’s offerings. With its SMB partners, SAP is focusing on making sure partners are able to quickly implement with a series of rapid deployment solutions, seeking to shake the well-earned impression that SAP products are unwieldy and time-consuming to roll out.

The company is also seeking to get things moving more quickly in its OEM business, which includes products from a number of SAP acquisitions, most notably Sybase. Richardson said the company has built a deal development team to go after that portion of the market, and will work with partners to get deals done more quickly.

As it looks to build its SMB presence, the company will also seek to get closer to its distribution partners, again seeking to focus on speed and agility by emphasizing “try and buy-ready” offerings that shorten partners’ sales cycles.

And finally, SAP is eyeing more connections with what Richardson calls “next level service partners,” services-led partners who are building both expertise on top of the company’s solutions, and bring their own deep vertical or horizontal skills.

Earlier this year, the company outlined its plans to get its in-memory database deeper into the SMB community, an area where the company wants to be “as close to 100 percent channel as we can.” That means building capacity around the technology. Those efforts are well underway in the form of various workshops and enablement programs.

“Channel capacity around HANA is not going to be an issue,” Gilroy said. “Our channel understands that HANA is game-changing, and it plays in the enterprise, in the midmarket, and even into small enterprise.”

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