SAP has reorganized its internal organization this year to allow more aggressive recruitment of new cloud-focused SMB partners, including non-traditional partners. It’s a strategy they plan to accelerate in 2018.
SAP has been giving attention to the SMB space for years. Earlier this year, however, they made internal changes to their channel organization, redeploying resources out of the business units into the channels team. They brought back a separate SMB recruiting team, which had been absorbed into the Line of Business units several years ago. Marc Monday moved over from SAP Concur to a newly created position of Vice President, Partnerships & Ecosystems for North America. Christina Martin Greysman became Vice President, Partner Recruitment and Activation. SAP thinks that this approach will accelerate their SMB presence, and that expanding their SMB presence is the best way to attain their objective of tripling their cloud business by 2020.
The new initiative included SAP’s presence at the CompTIA ChannelCon event at the end of July, as part of its outreach to talk with resellers who serve smaller customers.
“We are really honing our message around what it means to work with partners in the cloud,” Greysman said. “By the end of the year will have recruited almost 100 partners. Most of them are entirely new to the SAP ecosystem. Those who are not are expanding their relationship with SMBs by moving into reselling around cloud in that space.”
SAP uses the term General Business internally to refer to the SMB-mid-market space, and defines it as companies with less than a billion dollars a year in revenue annually. Greysman indicated that SAP’s recruiting of SMB cloud partners isn’t looking just at that top of the spectrum, and so isn’t a midmarket strategy in disguise.
“We are talking with companies with customer revenues ranging from $50-100 million up to a billion,” she said. “We are looking for partners with customers who have outgrown QuickBooks or Sage. Many of these partners have been selling Dynamics or Netsuite, whose practices haven’t been growing the way that they would like. They aren’t necessarily unhappy with the products they have been selling. Partners don’t pick a vendor just for the product. They are looking for a vendor who completes their business strategy, and what they are doing in the market. They are looking at the big picture elements of our long-term strategy, like our partnership model, and machine learning, and our Leonardo platform, and that bigger story is resonating with them.”
Greysman said these discussions with SMB partners are much more about cloud business than about technology.
“We talk a lot about partners evolving their business, particularly around how much they are investing in digital demand generation,” she said. “We take it beyond a technology discussion, help them understand cloud economics in general, and help them define their value proposition. We come in more as a business consultant than a vendor pushing a product. There are lots of great products. We emphasize being a good fit with the partner’s strategy around the cloud.”
“With this shift to cloud, VistaVu Solutions continues to make huge investments in IP and growing our team around the SAP ByDesign cloud ERP solution, said Jory Lamb CEO of Calgary-based SAP partner VistaVu. “We’ve identified 5 verticals we feel we can be successful at: Industrial Field Services, Life Sciences, Industrial Machinery & Components, and Food & Beverage and we are investing in these spaces, as well as seeing tremendous momentum working with SAP in a short period of time.
While cloud partners are the target, SAP is not signing up many ‘born in the cloud’ partners.
“They are definitely a minority,” Greysman said. “We have a great brand, but it doesn’t attract small born-in-the-cloud companies. They won’t necessarily talk to us.:
Greysman said that SAP has more success with companies who have “bought-into-the-cloud,” rather than being born into it.
“We tend to be talking to the Gen-Xers of the cloud, not the millennials,” she said.
“We are also diversifying the audience we are talking to,” Greysman added. “For instance, we are now talking with CPA firms. There are alternative channels, with new types of consultants, and we are starting to work with those. We want to target more of those in 2018.”
Greysman said some of the new partners are seeing strong early momentum.
“We have one new partner, a couple months into SAP partnership, and we have six deals in the pipeline with them already,” she said.
“Cloud solutions have revolutionized the way SMB clients look at HR and other enterprise software,” said Sabya Mitra, CEO and CO-Founder of Dallas-based partner Renew HR, which has established a strong practice around SAP SuccessFactors. “Our SHARP RDS solution along with aggressive pricing from SAP has helped us to target very small customers as well which once considered out of reach by many in the industry. The smallest client we implemented successfully was a 47 employee company.”