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Ultimate Guide to Partnering® Special Interview
Join Vince Menzione in this special episode of The Ultimate Guide to Partnering, where he shares insights from an exclusive interview conducted on the Partnerships Unraveled podcast hosted by Rick van den Bosch. Explore the intricate realm of tech partnerships and ecosystems, delving into Microsoft’s dynamic partner ecosystem, mid-market focus, and AI investments. Discover invaluable perspectives on Microsoft’s channel strategy and growth opportunities alongside expert advice on leveraging marketplace opportunities when partnering with Microsoft. Uncover the crucial role of partners in Microsoft’s AI strategy and explore potential opportunities in this burgeoning field. Don’t miss out on this enriching episode packed with actionable insights and expert guidance.
What You’ll Learn
- Partnering and ecosystems in the tech industry. (0:02)
- Microsoft’s partner ecosystem and event. (4:26)
- Microsoft’s mid-market focus and AI investments. (9:34)
- Microsoft’s channel strategy and growth opportunities. (15:29)
- Partnering with Microsoft and leveraging marketplace opportunities. (19:37)
- Microsoft’s AI strategy and partner opportunities. (25:50)
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Announcing Ultimate Partner Experience
I am thrilled to welcome you into a world that delivers unparalleled insights, best practices, and essential information to unlock your potential as a partner and propel you towards your most ambitious goals. This is a world crafted for partners like you.
Our journey began seven years ago with a vision to empower partners in the complex world of tech giants like Microsoft, Google, and AWS. It started with a podcast.
Today, Ultimate Partner’s mission is clear and bold, “empower every individual, organization, and partner to achieve more through successful partnering.
As an Ultimate Partner Experience Member, you will unlock a growing treasure trove of resources. Dive into recordings of our events, exclusive podcast episodes, and a wealth of unique content, all designed to enhance your Cloud Go-To-Market (GTM) strategy and ecosystem growth. We are in our early days and expect much more to come.
As an innovator, being part of this experience is more than joining a community; it’s about integrating into an ecosystem brimming with innovation and collaboration. Here, shared experiences and insights are your gateway to progress, offering connections with peers and resources to elevate your Cloud GTM strategy. This is your platform to engage, seek support, and contribute to our collective growth.
I’m thrilled to welcome you to this journey. Let’s navigate, thrive, and redefine success in the tech partnership landscape together.
Welcome to the future,
Vince Menzione
CEO, Ultimate Partner
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Transcription – by Otter.ai – Expect Many Typos
SUMMARY KEYWORDS
microsoft, partner, organisations, ai, marketplace, channel, customers, ecosystem, market, selling, work, recognise, model, bit, big, company, created, opportunity, partnership, cloud
Rick van den Bosch 0:02
Vince, how are you doing today?
Vince Menzione 0:03
Rick, it is so such a pleasure and an honour to be here with you today. Thank you so much for hosting me. Likewise,
Rick van den Bosch 0:10
we actually recorded the podcast earlier together, but then it was on Ultimate Guide to partnering. So I’m very excited to continue the conversation today and the dive even further in the world of ecosystems on the channel today.
Vince Menzione 0:25
You know, I love I love unravelled because I think it’s a great way to decode and talk about what we’re experiencing in our world in our lives today. So excited for this conversation.
Rick van den Bosch 0:34
Likewise, I’m super curious. Also, for our listeners, Finns, who might not know you yet, could you elaborate a bit more on how you got acquainted with partnerships, and you’ve had an impressive career there. So I think it’s definitely interesting to learn a bit more there. So
Vince Menzione 0:51
Rick, as you mentioned, I’m the CEO of ultimate partner and the host of The Ultimate Guide to partnering podcast over 200 episodes. Now we’re in the 200 range now, which is kind of crazy. I started my career in the early days of wireless computing describe this careers for successful business transformations. I’m on number five now. And I started off carrying a bag as a salesperson company that was in the early days of wireless computing before Wi Fi. We were pioneers in that technology. We I use partners to build an influence strategy to help us grow our market share. We went public on the Toronto exchange, we had a successful exit that companies now Zebra Technologies, I followed one of the leaders to go to a turnaround company that was at the brink of bankruptcy. And Golden Gate capital had spun us out. And I built a new business. And that’s where I started into the partnership role to really fully I was asked to build the government business. We were Panasonic’s largest competitor, Panasonic was the market leader in selling into public safety and military. And we had a product that was equally as good. I built the channel strategy, I went down to Washington, DC, I aligned with several the largest technology partnership organisations and I build that business incrementally X. Just we had, we had tremendous success. I was the growth engine, we sold the company to another company, General Dynamics large defence contractor, it was at that point that Microsoft recruited me. And for almost a decade I ran Microsoft’s we didn’t call it ecosystem at the time yet we call the partner strategy. But I ran the ecosystem for $4.6 billion business within Microsoft for almost 10 years. And I learned quite a bit about partnering and ecosystems and all the different types of partnerships and, and what that meant to building a successful strategy for a large tech giant like Microsoft. I left at the end of 2016. And I was convicted more than ever. That organisation struggled, I saw the partners that got it right. I realise a lot of organisations still struggle to the 400,000 Microsoft partners in that ecosystem, which is the same ecosystem that all the big tech giants really care about. It’s really one ecosystem. And I started this podcast Ultimate Guide to partnering, I started doing consulting work for those organisations. I went back inside for two years to the largest software company nonprofit. And I recognise that the C suite level, there was still a lack of understanding and alignment of our partnerships. And so when I left during COVID, I was convicted more than ever, that we needed to solve for this. And so I’ve made it my mission now, to help organisations achieve their greatest results through successful partnering individuals and organisations, I want to empower the world of partnering. And it’s I’m on a 10 year journey, a 10 year mission to help solve for that with ultimate partner. And we’ve expanded now from just being a podcast, to doing digital and live events. We’re going to be building a collective of organisations we want, we want to invite everybody that is that cares about the hyper scalar ecosystem to be part of that collective, because we feel that they need to have a stronger voice, working with the big hyper scalars. So that’s where I’m a mission to help solve. I won’t stop until the chief partner officer is that equal footing with the CRO, the CFO and the CMO and the organisation at the C suite. And that’s that’s where we hope to get to.
Rick van den Bosch 4:23
I love that. And that’s super impressive Korean partnerships. And I’m very curious what you think I can totally imagine in the back in the days already at Microsoft probably it wasn’t called ecosystem yet. But I can imagine Microsoft is always the front runner and everything partner related. Really were a lot of things that were actually already ecosystem, even though we were mentioning it like that yet. Like, could you maybe give some examples what you see right now what are very hot topics. I mean, the market which actually maybe Microsoft was already starting to work or really laid the foundations for at that time.
Vince Menzione 4:58
In fact, we can Hold the network back then. But I’m going to back I’m going to back up, because I feel like Microsoft created it at the very beginning. We might you and I talked about this once before. But when Bill Gates came down here to Florida to Boca Raton, to meet with IBM when they created the PC, and they were going to buy his operating system, he said, I’m not going to sell it to you. I’m going to licence it to you. And they also agreed to licence the hardware components that sparked an ecosystem that created trillions and trillions of dollars of new incremental revenue in our industry. And it created Michael Dell started building PCs in his dorm room, and Compaq computer got started. An organisation large reseller organisations in the United States CD W and some of these others started marketing started delivering magazines and doing direct marketing to sell you PCs and networking bars were created. The whole ecosystem was really spawned from that moment in time back in like 1981. Microsoft recognise that and they nurtured that they realised they couldn’t sell direct, they realise their where their strengths were. And they didn’t want to have 100,000 salespeople out there, they realised the leverage and the value of the partner network that they call it back in the day. And they also started to divide and conquer, like, okay, these parts they, they bucket ties partners into specialisations, they recognise that there were MSPs, and si guys, and ISVs, and GSI, guys, and so on, and learning partners and all like, and they started nurturing and building a whole partner, organisation around it. And they’ve done a better job than anybody at aligning that and aligning salespeople to the success of the partner ecosystem rather than dividing it up and siloing it. And Microsoft is probably the most, I think it’s either Gartner or McKinsey that says Microsoft’s the most complex hybrid organisation in the world. But they’ve figured out a way to make this all work and integrate it so that people a salesperson cares about selling a partner, there’s partner people supporting it, there’s partner development managers, and they have a division of labour. And then the organisation I think, is very unique in supporting that ecosystem. And then the Microsoft inspire Conference, which used to be the worldwide partner conference was the the seminal event that everybody went to every year. You know, I know that I know that you have some family members that participated in that I know they came, they came over to the US to go to that conference every year. It was it was the happening. And then COVID changed all this right. Now we went virtual, we went digital. And it’s a shame in some respects, that that ecosystem hasn’t gotten the nurturing and love that it needed before, which is where we came in, we came in and helped support that we just hosted a live event in person. We called it ultimate partner live spark the ecosystem because we felt like that nurturing needed to happen. And it was an overwhelming success. I mean, I’m still getting people reaching out to me, telling me how amazing they thought the event was. Yeah,
Rick van den Bosch 8:06
absolutely. Like, I can only tell from my perspective, but everyone who is interested in Microsoft in my network knew about the event. And I also saw it everywhere throughout LinkedIn. And I’m actually super curious. And I think that’s actually so interesting to share with our listeners as well. I just said it already. But Microsoft is always the front runner, when you’re in general, when you’re embarking ecosystem, we are always looking at how is Microsoft doing it? Because we know that they have already tried and tested so many things. And if they launch it to the big public, then that’s also where they are all in and moving forward there. And I was super curious about that. Since would you like to share a bit more about the event, both in terms of how it was but also definitely what are the top priorities right now of Microsoft leadership? Because I think we can learn a lot from that in when we’re building a channel or partner ecosystem. Yeah, I’m
Vince Menzione 8:59
so happy to share. You know, I’ve described this time we’ve been living through is the tectonic shifts right. We’ve been seeing in our world or lives geopolitically, all the things have been going on COVID accelerated transformation. Organisations invest invested heavy, but then we had the economic headwinds, and they backed off. We’ve seen, you know, tremendous layoffs in the last 18 months or so in the tech sector, which also has precipitated doing more with less. So I now do the job of three people. Microsoft did that too. By the way. They said like, well, we need to do this. So we came in and we said, You know what, you’re not doing a live event. I had reached out one of the I’ve been blessed to have some several leaders from Microsoft participate in Ultimate Guide to partnering. We’ve been privileged to have some of Microsoft’s top partner executives come use our platform is the place to tell the story. announce the new programmes and things like that. So I was able to get some of those leaders in a room and it was it was two days. 30 speakers 16 sessions by both, you know, both keynotes, fireside chats and panel discussions, workshop type discussions, where we took an align to the three major priorities Microsoft announced at their inspire conference. Of course, AI was priority number one, right? I mean, Microsoft’s investments in open AI and what they’re doing with Chet, which at GBT and copilot. I mean, they’re, they’re leading the way. Sati has been visionary in this respect. And they really, it’s making a difference you just see in the stock price these days, the other big announcement they made, I mean, AI is going to infuse into every product and every technology, and they want everybody to build with them. The second one was around marketplaces. And we’ve been talking about this year as sort of the marketplace moment. AWS was out of the gate a little bit early investing in marketplace, selling, of course, coming from their retail background. And Microsoft is playing fast catch up. And this year, they made announcements and said, If you want to do co selling with us, by the way, Microsoft between Microsoft, Google and Amazon, they’re about $300 billion in durable cloud budgets. That means that those three hyperscalers have went to gone to the enterprise customers and mid market customers and said, Buy these agreements for our cloud. And so they own those budgets. And they allow those clients to burn down those agreements by buying software from their marketplaces. So they’ve created a new channel. This channel with marketplaces is a new way for ISVs. And SI is to sell their solutions to Microsoft, Google and Amazon customers. So we we focused in on that marketplace moment. We had the leader of the marketplace organisation Anthony jofa, Joseph Joseph in the room, and we did a fireside chat talking about the benefits of marketplace. So organisations are really it’s still new. For a lot of them. I feel like it was where we were 10 or 12 years ago with the cloud. People were kind of resisting the change. But the change is happening. And in fact, Canalis did a study. Jim, our friend Jay McBain was part of that organisation. They said $45 billion will flow through marketplaces by the end of 2025. They under call that Jay said they under call that it’s going to be more like 50. And then tackle IO, which is one of the big marketplace software companies is predicting. By the end of 2026, we will see $100 billion in sales and transactions flow through these marketplaces between the big three. So we need to get out you need to get on the bus or get on the train. Because it’s taking off and you have to we have to embrace that, right. That’s the agility component of great partnerships and organisations. And then the third area of focus is really around the mid market. And I was privileged that the president of Microsoft small, medium and corporate accounts, which is essentially its Midmark, its mid market and SMB business. He was he was my keynote, he came in in a big way and supported the event, and really sparked the conversations and that mid market opportunity is huge. I know our friend Jay was talking about Jay again. But our friend Jay and Canalis did some study and some studies on the mid market opportunity and it’s in the trillions of dollars. And Microsoft alone. They do about $75 billion dollars a year in that mid market. And it’s only 40% penetrated for partners. So there’s a huge I’m calling it the acre diamonds like partners that are a lot we know this right? A lot of organisations only want to focus on the very big organisations, those organisations get saturated at some point, right, everybody’s calling on this mid market opportunity is huge. So it’s the third it’s the third pillar for Microsoft this year. And we brought in the leadership to speak to partners about how to be more successful selling into that market. So we recovered all three all the sessions revolved around those three pillars with Microsoft. I’m so excited to continue our partnership with ag one. Many of you know I’ve made taking a green drink supplement part of my health ritual for over 21 years now. And it has made all the difference to my health and well being about six years ago, athletic greens and now their product ag one became my go to supplement. Ag one is the first thing I take every morning to power my day. It covers all of my nutritional bases, supports my gut health gives a boost to my immunity and energy levels. 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Rick van den Bosch 14:46
I think that’s super interesting and also very similar to conversation. I hear from a lot of vendors that we speak to regularly in terms of what everyone is talking about and we know we need to do something with it and that’s why I would love to dive a bit deeper into the specific three key points. And I’m actually going backwards from the one you ended with. Like I think that’s so interesting right now maybe first question, some clarification on mid market. So is that do they call it mid market? But is it is it a combination of SMB and mid market and you should companies together? And secondly, why do you think that area of SMB is so important than why some a company like Microsoft is so heavily investing in that area? Well,
Vince Menzione 15:29
like I said, the top of the the top of the pyramid, the enterprise organisations, which represents about 11,000, top organisations, you know, the big tech, the big organisations, the Coca Cola is of the world, the General Motors, all those big organisations. Like I said, they’re dominated by big GSI is global systems integrators, big projects, long sales cycles, it’s hard to move through those hard to navigate, and it’s crowded, it’s crowded at the top, in this bid market segment. I’ll do Microsoft’s numbers here. They have about 38,000, I’ll round it up. 38,000 accounts. Right, that’s, that’s a bigger, that’s a bigger chunk. Yeah, they just and they haven’t been good before at being focused in this area. Microsoft, used Microsoft as the example. I think everybody’s the same. And in terms of tech giants, they they had a different operating model for each of the their, what they call operating units. So if you went to the lat tam region, or you went to AIPAC, or you came over to a mesa where you are, you find a different engagement model it there wasn’t any universal Tality it was hard to navigate. And it was hard to work with the teams and those teams were not as partner centric. They were just worried about selling licences and selling what they had in the in their bag. Were enterprise knew it, they had to work with partners. They have they’ve changed the model. Now they’ve centralised all the resources. So in the Microsoft world, they’ve taken the 6000 employees across every industry in every geography at Microsoft healthcare name, all the industries enable the geographies. And now they report directly into this one individual Kevin P skirt. And they have a regional model. They they have three regions, the Americas, EMEA and the APAC region. And those three models. They also have a corporate vice president structured, but they’re centralising. They’re creating a methodology across. And they’re also welcoming and partners more, and they recognise that they had a gap here. And so they’re investing heavily. In fact, Microsoft 75% Of all the channel incentives for Microsoft this year, are going into that into that business 75%. So it tells you, they’ve made a huge commitment here. And like I said, there’s 38,000. And then at the SMB level, there’s 150 million customers at the SMB level worldwide. So huge opportunity for growth, and Microsoft’s not going to touch those SMB customers at all directly. So the huge opportunity for the channel to go. Again, this acre of diamonds and great opportunities for growth. Think about taking an organisation, any organisation of any size, and implementing AI, or all these other rich technologies, helping other helping ISVs and other SAS software companies get to reach to those customers and stitching it all together. Like we like to talk about the fact that customer doesn’t just buy one, one vendor, they put together a solution, they’re solving a business problem. And it requires multiple organisations to come together to do that. So there’s this huge opportunity in the work that you and I do to help solve for that, I think I think I mean, it’s it’s such a great opportunity for growth for all of us, Rick. Yeah,
Rick van den Bosch 18:56
100%. And I think very impressive in terms of putting your money where your mouth is like aligning 75% of your incentives to that part of the market. I think that that’s a really big move. And something that we all in partnership should be aware of, because Microsoft like search, in my opinion, is the most brilliant strategic mind out there. So he won’t be doing that without some very thorough thought behind making such a move. Like I’m interested in the piece there like so we have mid market and SMB. And then I can imagine mid market is probably large enough that some of the direct sales of Mark, Microsoft’s can work on that but they’ll do a park assist play, but from what I understand SMB will be a pure channel play. So both the selling and the implementation and everything needs to be done by the channel.
Vince Menzione 19:42
What they’ve done in the mid market is they call it corporate accounts. So these corporate accounts, these 38,000 customers, they have they have a one to many, so they have a direct sales rep. They have a swarm basically they’ve created a pod around those customers. So there’s technical resources, they’re selling resources, and there’s partnering resources supporting a group of customers. And the ratio, we’re in enterprises, maybe like one to five, one to seven, you know, one, one rep for seven customers, it’s more like a one to 25, or one to 50 model, depending on the market, and the specificity of the customer. So they are directly supported. But again, if you’re, if you’re calling on 50 accounts, and in the course of a year, and you have a big book of business to drive, you’re not going to do that yourself. You need transactional partners that are going to help sell the software and the licences, you’re going to need systems integrators to help implement support, project management, do all those things. And you’re going to need ISVs that are going to bring bring now they’re going to bring their marketplace transactable offers. So think about all of the SAS software companies, you want to get into that marketplace, because you want the sellers over here to say, Oh, you have a backup and recovery solution. This is the one you should use. And they are by the way, they’re starting to use AI internally, to be able to track the vendors and who’s being the most successful and who has the best customer SAT scores and the like. So I as a seller now have at my disposal a whole toolkit and also, you know, pane of glass that tells me who I need to bring in and who can best support me on those sales. So again, this whole partnering strategy is just critical to success. Yeah,
Rick van den Bosch 21:28
it’s all super connected to each other. I think what also in the tying is a bit more to the marketplace point, which is also very interesting. One of the words that struck me was like a little bit of reluctance, see which I also really know this in the channel because we’re all a bit scared because what Amazon of course did in the retail sector was cut off the middlemen and go direct to customer. Yes, so I can imagine some of the reluctance is coming from that angle from specifically the channel. But what how do you see that the channel is being because from an ISV perspective, it makes a lot of sense immediately marketplace like you can bundle it, it’s easier to buy from a customer perspective with how do you see them tying in the channel? And also, what do you think like, for companies looking at that, and also trying to get their channel involved there as an ISP to skill operations? What like, what are a bit of the arguments why it’s also very relevant for the channel actually to to collaborate there?
Vince Menzione 22:24
Yeah. Well, you know, the channels. I mean, we talked about the, the Boca Raton moment, the channel has had to evolve, right? Because if you’re following the big tech giant, you know, your models have changed, right? He’s there used to be all of the incentives, I was very close to Microsoft’s channel incentives programme. So I know the numbers about what we spent every year. And it was in the trillions of dollars. It was it was it was the it was the I’m sorry, it was in the billions of dollars, not the trillions of dollars, it was it was the one of the largest line items, in fact, in terms of channel incentives. And that shifted, though, it’s still there. But it shifted, it shifted to driving the right behaviours. And Microsoft will continue to do that. Right as, as we talked about with these channel incentives. Marketplace, if you’re if you’re in the channel, and you’re used to a model that was different, and you were making more money doing something else, and all of a sudden Microsoft or someone else imposes this new thing. You’re a little bit reluctant, right? But there’s other opportunities for growth, right? So you have to look at and say, I might make a little bit less here, but I can make more here. And you’re starting to see this evolution of the channel. Some of them, one of them here in the United States insight is, you know, I would say they’re on their forward leaning in terms of what they’ve been doing. They’ve been evolving their business to compete, they’ll do the transaction work, they’ll provide all the other services and resale and everything. But they are leaning more into the Accenture’s and GSI world a little bit more. And in fact, they made a major purchase just recently, of Google’s largest reseller and system integrator partner SADA Systems. So you see that you see that world evolving to right, where they’re morphing their business models, and they’re embracing marketplace. Some of these organisations again, you mentioned, the reluctance, working with Amazon looking saying, hey, you know, we know how Amazon operates in the retail world, are they going to do the same thing here? And I would say proceed with caution. I would say Microsoft will continue to be the Microsoft of old in terms of embracing their partners. But they are creating this value chain that says we are creating we’re creating value here because we have signed up these customers already. We’re working at the C suite level, by the way, those Mac agreements and cloud agreements that they the three hold. Those are negotiated at the CFO level these organisations they’re not in the line of business, but it makes it easier now to take removes a lot Under the friction from the process, so you don’t have to go find budget to go buy your software, you just have to find a customer that likes your software, and has access to a Mac agreement. So it changes the whole model up. And hopefully it will drive, it’ll drive better behaviour. And the channel organisations are going to evolve accordingly the same way, the same way the world evolved 12 years ago with the cloud, right? Everybody was selling Dell computers and targets bags back in those days, they still do. But nobody was selling cloud, they were like, What is this cloud thing? And it looks like it’s a direct a direct model, and you’re gonna buy directly from the hyper scalar? Well, that’s changed as well, we we’ve all recognised that that’s created more value for these organisations to not only sell the cloud, but also wraparound services around that. And I think we’ll see the same thing with marketplace. Yeah, 100%,
Rick van den Bosch 25:49
I think we could do a full extra episode on the consumption based model. And indeed, how it works with actually the hyperscalers getting in at the sea level, having huge contracts where you can highly benefit as an ISV. Because it’s almost like Microsoft or Amazon is gonna pay you for the contract. But it’s with credits that the customer builds up, etc. It’s super, super interesting, right? And
Vince Menzione 26:11
it won’t Yeah, and I want to just note here too, because we talked about the channel, right? It’s not going to replace the channel, the model today, at least not in the near term, it becomes another channel, right? It becomes another channel to the customer and the customer by various ways. And you just have to be agile enough to recognise that. Yeah,
Rick van den Bosch 26:32
absolutely. I think one last question around the marketplaces like the examples and deeds of, of insight, for example, like joining the marketplace, and working more around that those are almost what I would call like the GSI, sort of really big Fars, or the DMR, almost direct market resellers. But for the SMB channel partner, do you also see a role there for that marketplace or less, so?
Vince Menzione 26:56
No, just as much. So I mean, maybe maybe at a smaller scale, but these organisations are going to provide professional services, and support customers, uniquely and more locally, right. And there’s still that need, like if I’m a company in a certain geography, I have local relationships. And you know, I’d like to go back to the five or seven seats at the table, to say, who is influencing my decision process. And it may not be one of the big DM ours that we talked about, it might be a local systems integrator that you’re comfortable working with, they now have the ability to bring to you everything you need. Right? So it’s enabling them more, in fact, to go do this through marketplaces, because now they have, they have the full access to that marketplace. And customers aren’t going to do this by themselves. We know that right? This is technology, especially smaller organisations are more challenged, they don’t have the IT staff to go do it themselves. So I’m going to rely on my local and trusted vendor to support me in doing that.
Rick van den Bosch 28:01
Yeah, absolutely. And I think any SMB channel partner, you might lose a little bit of margin when doing it in such a way, but you win it back as well, because everything is in one invoice. It’s very easy to manage, like everything you would use to do with a distributor in the past now is can be managed with a marketplace or hyper scalar as well. That’s right. That’s right. I love that then then we get to the final point of AI, of course. And first of all, I want to say like Microsoft, all in on AI, big investment. They had some tumultuous weeks, but I want to do a shout out to such because that is true partnership. Some album Back at the rings of open AI definitely not what I expected the author, it just happened. But then you can see like if you have a very strong partner, and they have your back, while in effect that’s going to happen. I think it’s the best decision for open AI and for the AI continuation of innovation and progress there in general. So big shout out there. I’m also super curious to learn in the like what the you see there in terms of the AI like, of course, we know why AI is so important. But I’m also super curious, what role does Microsoft see there for their partners in terms of bringing that AI to the market? They’ve done the big investments, they’ve worked insanely hard. I’m super impressed in integrating AI and all their products and in being in office in teams in every were in Azure like but what then now it’s I think up to the channel to bring it to market. Like what what’s their strategy there and what do you think that are some of the roadblocks they might see there?
Vince Menzione 29:40
Well, first of all the call out this idea there right? That was a masterclass and strategy like what he did with with Sam. First, first of all, he was blindsided, right that I mean the board didn’t even let him know until minutes before they announced it, which is crazy. And then he He took the he took the high road. And he said, Well, how do I best support this? I want to support Sam, I want to support open AI. He brings Sam on board on a Sunday. Right, Sam, Sam, he sets up a new business unit. By the way, almost all the employees said they were going to leave. So he knew that like, if open AI isn’t going to do it, they’re all going to be Microsoft employees. And then he positions it. So Sam can run back into the CEO, or get back into the CEO slot, which was just incredible. Now on the product side, what you’re seeing, I mean, Microsoft has been the Productivity Suite, right, and we go back, I mean, let’s let’s look at offices is just a crowning example, and M 365. Now, and all of your productivity offerings and sweet. Everything is infused now with AI is getting infused with AI, it’s, there were big announcements and releases in early November, we’re continuing to see things they had their big Ignite conference, the ability to infuse all this technology, they’re all the partner stays pretty much the same in that regard, right? Because these are saying these are organisations that need to embrace and deploy these technologies, they will do that. The role, there’ll be addition, there are additional roles for GSIs and s eyes of any size and shape, to take advantage of the toolkits that are available in Azure AI. And you can go on with the list of Microsoft acronyms and names. But being able to take that technology and deploy it locally, people will want secure GP TS they’ll want they want the ability to do their own and not be in the public domain. So the ability to implement those is going to be huge opportunity in the ISP and SAS world community. Well, I mean, I want it I want to infuse this technology into my my offerings, right? So there’s the opportunity for those partners to go do that. And then to implement that. So it’s creating more opportunity for partners of all types to take and infuse that, that stack into into organisations. Right. And it’s we’re just at the beginning. So I can’t even predict where it’s going to go. But we are people are talking about this. As even probably the biggest thing that’s happened in the last 40 years, right, since the maybe 50 years since the chip. Right? Yeah, we went through the PC era, we went to the client server, we went to the internet error. We got to mobile computing, we got to cloud and now we’re in AI and it’s man, it’s going to be it’s going to be a wild ride these next 10 years. Yeah,
Rick van den Bosch 32:25
it’s incredible. Really ended like the pace at which everything is progressing. I’m very curious to see where that’s where that’s going. And a question that comes to mind immediately we meet it’s such a new technology like we need to the left, but also it’s progressing so quickly. And that will keep the same pace priority or only grow exponentially from an innovation side. What strategy does Microsoft have in place to actually make sure that their partners, both the ISVs, and the channel can actually easily message that and take that message of AI but also the implementation etc. to the market? Do you see any potential blockers there are challenges for for Microsoft, Microsoft
Vince Menzione 33:08
is putting out a lot in fact, once once we have the content live, I’d love people to come see like the videos and some of the things that Microsoft showed at our event. But I mean, they they want the partner world to embrace it. What I would say in terms of blocker, I would say one thing I will say about Microsoft, even as a former employee, I’m still people like Brad Smith, who’s president of Microsoft, there’s an ethical level within Microsoft that you don’t see in most, if not any other technology company that they will do the right thing they will do. They’ve always professed the cloud for good. People like Brad Brad wrote a book called tools and weapons and he sits at the forefront of Microsoft’s aim to ensure that we do this in the right way. Right. And Microsoft again, being a partner led partner, they took the word AI if you know this, they changed the name of the partner programme in July. In fact, we had Julie Smith, Julie Sanford, come on to the podcasts and talk about this. They change the name of the programme from the Microsoft cloud partner programme to the Microsoft AI cloud partner programme. So they’ve infused AI into everything including the name of the partner programme for the 400,000 partners, which tells me and the channel incentives and everything that they’re doing, that they’re leaning in have more heavily. They are, I know for a fact that they are quintupling the size of the technology groups supporting AI. They had a team of black belts as an example, here in the United States. That was a fairly small ragtag team, maybe 20 people they have, they are going five times the size of that organisation just to support customers here. And they’re doing the same things around apart they Microsoft’s view is we bring we bring the technology in We bring the partner and the customer together, and we go solve for it together, which has been always been their approach.
Rick van den Bosch 35:06
I love this. Yeah, it just you can really see that Microsoft is always one step ahead of where they should, or multiple steps ahead, let’s say like that of where they want to go and where they are going. And that’s what you can clearly see with this as well. And again, also with things like that, I can also highly advise that to our listeners, like if you launch something, launch it back, like look at Microsoft, such an enormous company, but when they launch AI, they implement it everywhere. So everyone will know in their ecosystem, how important that’s gonna be for the upcoming five to 10 years or, and there are this case,
Vince Menzione 35:40
and even their executives. Kevin, Pisco, when he spoke at our event says I spent at least a half hour every morning studying what’s what we’re doing on AI practising it, implementing it getting to know the product better. This is the president of a $75 billion division of Microsoft, he’s spending time there, which tells you the whole company is focused on this. And to your point, too, I think they caught a lot of others were caught flat footed. I think that there was a there were a lot of people in other places in Silicon Valley in particular, that were going and getting into the rooms and going, what do we do now? What’s our strategy going to look like? What you know, they were just so caught off guard by Microsoft’s announcements. It’s an amazing
Rick van den Bosch 36:23
Yeah, absolutely. Awesome fans. I think this really was a pure masterclass early on where the partner ecosystem and channel is going, we spoken about how important SMB and mid market there’s going to be if you want to keep your growth rates that you had in the past as a tech company, because the enterprise market is getting saturated. So you need to really get that opportunity. We talked about how to really work together with hyper scalars and the opportunity with marketplaces and AI How can you best implement it? How can you leverage the AI that Microsoft is working with? I think it was super valuable. I definitely want to get you back later fence. And thank you so much for sharing this with our listeners. And to our listeners. See you next week.
Vince Menzione 37:10
Thanks so much for listening to this episode of ultimate guide to partner, online and Ultimate Guide to partnering.com. If you liked this episode, I’d be thrilled if you left us up to a five star review on either Apple or Spotify. This helps us to continue to feed your amazing guests. Also, please check out subscribe to our new YouTube channel, ultimate bar. We’ll catch you next time on The Ultimate Guide to barter.