Partners Shifted Focus Towards Cloud Services | Lata Singh

Lata Singh, Executive Director – IBM Partner Ecosystem & CSI elucidates on the partner ecosystem dynamics and how IBM has helped them during the pandemic.

What are the solutions and services in the IBMYOUR TEXT OR IMG HERE portfolio in India?

Some of the solutions we have apply in a larger context to whether they are in India or in the global markets. We do not differentiate between what is available in India to what is available globally. But if I really look at what is driving the market then I will come down to the hybrid cloud engagement that is there. We know that, only 20% of the core applications are on the cloud. One piece that is really very critical is the fact that hybrid cloud is critical to engagement that we have, and IBM is focused on hybrid cloud. The second part is that AI s embedded now in any of the business processes or technology processes that are being driven.

Now what does IBM have underneath? It is obviously a set of solutions, whether it is systems or what we call the cloud and cognitive. When we talk about systems, we have IBM Z Series to LinuxONE and we have had some fabulous wins in the country on LinuxONE. We have our IBM Power series, which is the underlying platform for a majority of the banking industry, the public sector and our storage which is the key from the infrastructure side.

We have converted our entire cloud and cognitive or software portfolio into containerization model. This is critical because we are talking about building applications, which are for the future and that is where our software comes in. And we have cloud packs across our application data and AI to integration, to cloud pack for systems and cloud pack for security as well.

We cut across the segmentations of solutions and that is where IBM strength is realized. We have a full portfolio to address the needs of the clients, and then we have a very strong services side as well whether it is the GTS service, which helps clients move their applications to the cloud, managing a large infrastructure to obviously our services in terms of application digital transformations that we take home for our clients. We have an end to end portfolio, which is strongly industry aligned but very strong in terms of the breadth and depth of solutions and offerings that are very critical to enterprises.

How is IBM’s partner ecosystem structured?

Our ecosystem consists of partners who have been with us from the time that we started in India to the partners who have evolved. We have large global system integrators, India based as well as global system integrators, who work very closely with our clients. They take on our cloud and cognitive solutions as well as the IBM cloud to the market. We have MOUs with a large number of them, whether it is Wipro or Infosys, Persistent and some of the others.

We also have the Mid-Tier partners we call as regional SUs, who are obviously filling the gap between that has been left by some of the larger GSIs, who are engaged on more services only engagement, which is application development, application deployment to digital transformation for the guys who are now coming into the RSI space.

Then we have a set of partners who are very niche and very capable, but focused on deep dive capability to deliver around, solutions that are very unique to a certain requirement in the market, whether it is a security requirement or IoT or integration or the cloud integration.

Last but not the least we have our value added distributors who are transforming themselves from the legacy way that they work to actually looking at multi-cloud engagements, looking at how they can deliver more to the ecosystem. They are actually setting up COE and other capabilities to help deliver a larger ecosystem with an IBM solution portfolio.

The breadth of the ecosystem is there with IBM, depending on how partners want to develop skills and invest. We are happy to absorb them in any one of the streams that we have.

What were the support programs from IBM to help partners manage the cashflow challenge as well as provide remote support and services during these pandemic times?

The ecosystem actually reinvented itself, and that applies to both customers and partners. Just like there are customers in different phases, there are also partners in the ecosystem who are in different phases. As a lot of the infrastructure was on-prem, they realized that they needed to build offerings for their clients, which are on cloud based model and accordingly reinvented themselves.  The aim was to see what can I deliver to the client which is more service-related and less only infrastructure related so that the services revenue increases for them.

This was one transformation in terms of the business that the partners did themselves, because they realized that they needed to look at what the client needs now and therefore change their business models. That is something which is happening now and will continuously happen. Now, what did IBM do here? First of all, we did a re-imagine partner program. We realized that the ecosystem is changing. There are traditional partners and a traditional model of engagement, which is a pure play sale of systems, sale of cloud and cognitive software. That sale remains and the important thing is how partners get incentivized on that part of it.

The other is what we call embed and that is where partners look at building solutions. So how are partners building applications or building solutions for the clients where the component is embedded in this solution? That is key because the clients are looking at solutions and are not looking at bits and pieces that are being resold to them. We looked at embed and we looked at a partner program that looks at payments or incentives, according to the build part of it.

Finally in services, it is important to see how a partner is building capabilities or services around IBM portfolio managed services, managed stock services, or DevOp as a service. Building service business out of IBM portfolio and these are the three that we really built into a program for our partners to say, look as you are transforming the current environment and some of you have already transformed, we are reimagining our partner program to give you those benefits from that.

Secondly, we spend a lot on engagement on helping our partners with digital marketing. Now that is something that has been core to IBM, but it was a good way to get partners on board to understand how digital marketing works. How do we get their clients to come on board and do that.

Thirdly, how do we enable them to build skills that are in our portfolio as well and the people say that it as good as the people who understand the technology and how to sell it. Therefore we have a seismic platform which is where IBM has also get their certifications learning and our partners are also on-boarded onto that. That is the capability building, learning that we did.

We actually broke it down into different programs– first the incentivization scheme, which is into the build, service, sale. Then we get into the entire marketing platform and helping them to get into the digital marketing world, which is so critical right now. Finally skills because it is a critical factor as to how do they build their sales capability, technical capability and deployment capabilities. These are the areas that we focused on.

From the cash flow perspective, we looked at it from two fronts. One is who is paying our partners– it is the end client. We have our IBM Global Finance, and we looked at the customers and we looked at how could we use it for financing our clients. When the clients take IGF, the payment structure to our partners is easy. That is the first part where we are talking to our clients and looking at the ability to embed IGF into our engagements with the clients which obviously translates to ease of doing business for our partners.

The second was obviously depending on quarter on quarter. How we run out more on very short term focused engagement, how we had schemes that ran through Q3 and obviously Q2 on what do you get if you have deals that are in the pipeline, and how do we convert them? Do you get an additional margin? All of that also came into it. I would call it multilayer engagement that we do it through the pandemic to support our partners and obviously to support the IBM business.

What were the specific financial packages that IBM offered to its partners?

I will get down to not just what we had done in the last six months, but what we have doing now as well.  I think that’s a big one because we are looking at our partners building solutions. We are looking at our partners adopting IBM cloud platforms and the cloud pack solutions. We are looking at them moving the applications that they build and move them to the cloud. Therefore IBM announced a $1 billion cloud engagement fund and that is available to the entire ecosystem because we want organization or partners to build capability on the IBM portfolio. We want to give them technical skills that will help them move their applications to the cloud or solutions to the cloud.

In fact, we have put in $1 billion in the ecosystem worldwide. It is also available for the Indian ecosystem to take and cuts across GSIs, RSIs, our VADs, the startup ecosystem and solution provider, the ISV ecosystem. Now, that is a lot of money. It is up to the ecosystem to come forward and say, look, we are interested, help us build a business case and we will look at obviously putting that to worldwide, getting the engagement fund to them, and then working to actually embed their solutions with an IBM portfolio and then also technically help them to move that to the cloud. We are putting our money on the table for our partners to say, how do they adopt and how do they transform because of what we are doing right now and we are keen to engage with the ecosystem.

What were the priority activities in digital marketing that IBM focused on during the current situation?

We were earlier doing a number of physical events where we looked at how many people turned up. That just got translated into the digital pieces when you are doing the event. To us this is maturing and along with our partners we do not want to do one to many like the physical events. We want to do one to a few focused set of your clients where we are very clear about what is the solution that we want to propose and how do we really have a one to one experience with your client so that we are able to articulate what is the technology that is best for their business and also understand what are they seeing the changes and what would they want us to do.

It became from one to many, to one to few because ultimately it is the quality, and not the quantity and then we progressed. Now that we have got the CIO or the CXOs on WebEx with our partners and again, depending on the partner’s capability, in terms of solutions and industry, we segmented them.

We now tried to get industry experts on that. We moved to get industry experts who can throw more light on what is happening and therefore it becomes more of a panel discussion, sharing, ideas, sharing thoughts and that has really worked out well. It is the learning that we did along with our partners. We realized that what matters now is a closer contact with our customers and our partners, understanding the value that our customers are seeing from our partners and how do we ensure that we strengthen the skills that they need from IBM per delivered to the client expectation. That is what we have done really well in terms of marketing.

How did IBM balance out between retaining existing clients and acquiring new customers?

Revenue or deals did close, opportunities did close, but let us, also understand that when you are doing marketing activities, it is not only for the present, but you are also looking for the future. I think that is an important aspect of keeping clients engaged, and keeping partners engaged. You are not looking at short term revenue benefit, but you are also looking at long term. A recent survey that was done with Fortune 500 companies, the CIOs actually said that they’ Ae interested in investing more in digital transformation, close to 75%. That did not mean that the others did not, it meant the others were already investing. But they want it to obviously accelerate that. That is a very positive sign from what happened in early in 2009, where CIO is, did not want to invest. They wanted to invest only on keeping lights up. That is the difference between 2009 to what we have now in pandemic situation.

Therefore the number of engagements that we did with client includes also seeding in the thought of what is possible. Therefore, when you are seeding in front of what is possible or what can be done through various technologies to meet the business needs, it is not just that we are talking about what happened in the last three months, but also what are the plans for the future? That is a discussion that has been very strong with our clients, through our partners. What are they looking at? What are the different models they are looking at? Where do they want to invest? How has that investment changed? And as long as you are getting those insights, I would say that is building up very strong pipeline for the future and that is what counts.

How did you manage to culturally imbibe among the partners the skills to go for closures of deals virtually in the new normal?

I think all of us who have been in the field are missing it. But the level of maturity that is there in the last six months in clients is being available for WebExes. The technical solutioning discussions have happened over the WebEx. We have done actually, a number of discussions and closures with our clients on WebEx or remotely. It is happening, it takes away the sum of the pieces that we used to do as pre-negotiation and post-negotiation enjoyment, that is definitely out because you are very focused when you get into the call and when you get out of the call, you are missing it.

We have leveraged maybe years of relationship that we have, and we have met each other, whether it is the partners or customers there is a comfort level when we have met each other. It is those years of relationship that we have built that is now working. Now, where to look at it is how do we ensure that we continue the benefits that the remote working has given us, but blended as we start moving out in the market but I would say it has worked out pretty well. It has been very short, focused discussions, not long elongated discussions. But I think the clients are sensitive to it because a deal needs to get closed out. They need the infrastructure solutions and services to get delivered, but I am sure all of us are missing the extended time we would spend time talking which is is not there now. It is just go in and go out. I think that is the piece that we are missing. As a sales person, I missed the pre-getting into the meeting and post-the-meeting discussions that happened.

What has been the traction for digital transformation among SMBs and how did IBM help these SMBs in the current situation?

SMBs in our ecosystem really have a large place. Around April sometime we announced a number of our cloud solutions are available 90 day free for trial and that encouraged a lot of SMB customers, as well as our partners to obviously download and look at what applications or what solutions that they could do as well as what they could use in their running environment. And that is one part of obviously addressing a larger ecosystem which includes the clients as well as the partners.

The second piece is the fact that a number of our partners built offerings, which are remote offerings or on the cloud offerings, around the IBM portfolio that they rolled out to the SMB segment. That was an important piece because organizations, which were used to be on-prem and seeing people also in terms of services being offered by engineers on-prem, actually moved to SLA-based requirements, moved to managed services, moved to public cloud, moved to a hybrid cloud model.

That was the critical piece because more than looking at, what did we do it was the whole way that they were looking at buying, which was more CapEx buying getting converted to OpEx buying and that was a big shift. The entire shift to the cloud was one of the key things and therefore, a lot of the SMBs used IBM cloud. They did use multi-cloud sensors, multiple other clouds as well, but the fact that our partners are able to deliver them key critical IT services in an OpEX based model is, is what I would say the IBM solution offerings provided to SME via partner ecosystem.

What are going to be IBM’s key focus areas both from technology and business aspect over the next 2-3 quarters?

The key is the health and wellbeing of our team. The health and the wellbeing of our team is the most important aspect that continues to be and will be most critical to us and a focus for us. The other is obviously accountability to our clients. Third is our strategy is very clear. We are talking about cloud and hybrid cloud and AI and that is where we are focused on. The strategy does not change. It only reinforces because the market is ready for it and it is hybrid cloud AI and ensuring that environments are secure with the data that you have. Invest now for future and that is what we are doing with our clients and our partners is enabling them with technology and solutions to address their needs of the future.

What are the measurable parameters to check this accountability for internal employees, partners and customers?

These are metrics, but you can feel it in the ethos or cultural the organization but you do employee feedback and employee surveys that are done regularly to ensure that the ethos are there. One is we measure it by employee surveys that we do regularly inside the organization and that is one way of measuring the pulse of the organization. Over the last 6 months, IBM is a large organization so various units have kept in employees, engaged, motivated teams through various circumstances. The employee engagement surveys, one way of measuring the pulse and the satisfaction or keeping being accountable to the employees.

The second is for partners and the customers and that is the net promoter score. How do you really measure the success from a net promoter score. You cannot alter that, the individual filling it in really has to give the experience that is feeling and it is not one person in the organization, but multiple people in the organization. NPS works, not just for partners but for customers, and with our customer partners as well. So we are looking at, are they happy, are we delivering and what is expected and obviously take that feedback and revert with inputs if needed. These are the measurements but there are actions that you do to ensure that you are on the right track and you have the pulse of both the industry, as well as the employees at any point criticality.

What will be IBM’s message to both partners and customers in the current scenario?

I would really look at it as from two fronts, partners and CIOs. For the CIOs, the time to do the digital transformation is now, a time adopt AI is now. But more importantly, it is time to look at security as the touchstone for all of us, because the faster, we accelerate our digital transformation through a hybrid cloud model with AI, into an embedded in our business and technical processes, you have to be really cognizant that we look at security as an important aspect of what we are delivering, because it is going to really impact to all of us.

For our partners, I would say build skills on technologies that are going to drive the next wave of growth for our customers and therefore it is important to be skilled because successful delivery is what keep our customers coming back to us. The most important is to focus on your employees because they are your wealth.