IBM reorganizes partner program to incentivize indirect sales

IBM is reorganizing its partner program in a bid to serve clients through partners with the same level of expertise as it does directly.

This is a big deal for all but its largest clients, as IBM has spent the last two years moving much of its focus to indirect sales channels. IBM now has dedicated sellers for just 400 direct clients, down from 5,000 two years earlier, CEO Arvind Krishna said in October 2022.

The new program, Partner Plus, covers IBM’s hybrid cloud and AI activities. (The company’s Red Hat division maintains its own partner ecosystem.) One thing that sets Partner Plus apart from its predecessor, PartnerWorld, is that partners will have to demonstrate certain levels of expertise to progress through the three tiers, still named Silver, Gold, and Platinum. Partners will begin Partner Plus in the same tier as in PartnerWorld, and will have six months to meet the new requirements in order to retain their ranking.

To help partners to develop the necessary expertise, IBM will provide them with free access to the same training materials its own staff use.

“The goal of the IBM Partner Plus program is to provide partners with a simplified, modern program that offers them the expertise to drive their success and create value through support and transparency,” said Kate Woolley, general manager for IBM ecosystem.

If customers engage with a seller at a partner, “That seller has exactly the same skills, training, badges, enablement material as any IBMer would have. The intent is making our ecosystem an extension of IBM,” Woolley said.

“We also want to make it easier for new partners to engage with IBM technology and get IBM technology into the hands of more clients,” she said.

To that end, IBM aims to enroll new partners in the program within a day, giving them the status of Registered Partners and providing them with access to its Learning Hub, TechZone demo environment and Seismic sales enablement tool to help them move up to a higher tier.

There will also be a top tier, Blue, whose members will include AWS, Microsoft, Adobe, SAP, Samsung, Salesforce, and others, Woolley said. “This is for a select coalition of our most strategic partners where we have deep partnerships across both IBM Consulting and IBM Technology.”

Choose your partners

For Anurag Agrawal, chief global analyst at Techaisle, the tier isn’t the most important factor when it comes to selecting a partner.

CIOs should consider four characteristics in their partner identification and decision-making process: competency, specialization, certification, and tier — ideally in that order.

“There are differences between competency and specialization. Competency measures broad technical capabilities in a vendor’s products or technology, whereas specialization showcases in-depth capabilities in specific solutions areas,” he said.

Agrawal said IBM’s partnership program changes fit in with the way enterprises are buying services. “Customers are choosing to move from turnkey systems to hybrid environments that align with their evolving needs. The customer choice will also require an accelerated frequency of partner-to-partner collaboration (not opportunistically but strategically). This is an ecosystem approach, which is what IBM is betting on,” he said.

A new role for AI?

CIOs approaching IBM for help with a project may have to push hard for the opportunity to apply Agrawal’s advice on choosing a partner or buying directly, though, as IBM is planning to automate the partner selection process using AI.

One of the benefits that IBM will provide to partners under the new program is access to a common lead management system, Woolley said.

“Within our partner portal, which is the single point of engagement, the lead passing is driven by an AI engine and will pass the leads to the best-placed partner based on a variety of criteria in terms of our partnership, their success, skilling — all of the criteria that you could expect,” she said.

Even though IBM clearly prefers clients to buy indirectly, and plans to take a partner-first approach to new business from tens of thousands of smaller, less strategic clients, clients will always have a choice, Woolley said: “If someone doesn’t want to go through our ecosystem of partners and they want to work directly with IBM, they can.”

Partner perspective

Partner Plus will open on Jan. 4, 2023. Its new sales incentives will take effect in April, and the co-marketing and demand generation programs will begin on July 1, 2023, the date by which partners must meet the new tier requirements.

As it developed the new program over the last year, IBM sought input from existing partners on what they were looking for. Bo Gebbie, president of long-time IBM partner Evolving Systems, was one of those consulted.

He praised the new program’s simplicity and transparency. “We want our key vendor partnerships to be simple, we want them to be predictable, and I think that’s what IBM has got going here,” he said.

He also welcomed the opportunity it will provide to upskill his sales and technical staff.

“There’s no longer a separation of what that training looks like for the channel versus internally with IBM,” he said. “We’re hiring a lot of new sellers, a lot of new technical folks, and the ability to do education that’s the same as the IBM team is going to be fantastic for us.”

AWS Marketplace

Under the new program, reseller partners will be able to count sales of IBM software made through AWS Marketplace, as well as direct sales, toward their committed spend targets.

Techaisle’s Agrawal doesn’t expect this to influence the recommendations they make to their clients, however. “Partners recommend hyperscalers to their end customers based on several factors — a commitment to the hyperscaler, the number and types of services required, integrated solutions, modernization and migration initiatives, types of workloads, and so on. I do not anticipate any shift away from Azure or GCP to AWS.”