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IBM will train partners one-on-one for annuity selling

Channel StrategyCloud

Big Blue wants to transform its channel for the world of solution selling. IBM Corp. is rolling out its Business Transformation Initiative (BTI) as a global program to train qualified small and medium-sized partners how to transform their businesses to an annuity-based selling model.

With IBM moving its own business model to a solutions-based approach, and orienting its business towards key emerging opportunities around the cloud, social, big data and mobility, IBM’s business partners are having to adjust their businesses too. And IBM heard clearly from its partner advisory councils that they wanted IBM to help with that said Mike Gerentine, global vice-president, business partners and marketing with IBM.

“When we started talking to them about cloud, and moving from one-time hardware and software license sales to an annuity model with the growth of data centres and our SoftLayer acquisition, a lot of partners said can you help us look in the mirror and understand how we can transform our business,” said Gerentine.

Many of IBM’s partners have a salesforce use to doing $100,000 sales, and now they’re being asked to move to selling monthly subscription licenses like cable companies, maybe for $500/month. And many are used to selling software and hardware as point products, when IBM is moving to higher-value solution-based selling that means a discussion with the CMO or CFO on business value. Many partners are more comfortable having a speeds and feed conservation with the IT manager, and don’t have the skills for a c-level sale.

Gerentine said IBM took that partner feedback and developed the BTI program. On a pilot basis, the vendor ran 85 workshops in North America and Europe last year. After tweaking, it’s now in the process of rolling out worldwide.

In essence, each BTI workshop is an intensive, one-day workshop with an IBM trainer and the partner’s senior management team. It’s primarily aimed and medium-sized partners. Every area of the partner’s business is examined critically and a transformation plan is developed, with 30, 60 and 90 day reports and targets. CEO commitment is essential, said Gerentine.

“It has to be a top-down effort to make this work effectively,” said Gerentine. “It’s not going to happen overnight. You need the right skills to move to solution selling, and the right solution selling model. You need a common cross-company methodology – at IBM that’s 101. It’s about driving operational level efficiency.”

Not every partner that wants to will get to take part – IBM will undergo a select qualification of each potential participant. While partners can self-nominate, most will be nominated by IBM’s channel sales team and then screened closely.

“The senior level need to really be committed to change – we want to make sure they’re committed,” said Gerentine. “At the end of the day, will they look in the mirror and make the hard decisions, do that analysis, look at opportunities for growth, and threats their business is exposed to? A lot of them will fall out during qualification.”

Currently IBM has several hundred possible participants in the pipeline, and they’re looking to leverage value-added distributors to scale the program further. IBM resources are being trained in each geography to lead the workshops. While different models have been explored, Gerentine said a one-on-one model at the partner location works best.

“The challenge of one on many is when you get into the financials of the business, many won’t let their hair down and share confidential information with their peers,” said Gerentine. “We want to make sure partners get best practices out of it, and we’ve had the higest success with one on ones.”

With about 85 workshops run last year and another 100 currently in the pipeline, IBM hopes to run 300 to 400 workshops per year worldwide in what Gerentine said will be a worldwide program.