Microsoft last month launched a solution for intranets and a
solution for supplier enablement, the first two in a planned series
of integrated software, service and support packages aimed at
helping companies address specific business problems.
In a special Q&A, Charles Stevens, corporate vice-president of
Microsoft's enterprise and partner group, spoke about the company's
solutions-based approach, which he unveiled at Microsoft's Fusion
2001 partner conference in July.
How do you see the life of an IT manager changing as a result of
Microsoft's new solutions-based approach?
IT is not just
about infrastructure, technology and products anymore. IT is about
the fundamental business of the company. And IT managers are not
just technology managers or infrastructure managers. They're also
business people. And they need to drive a business requirement with
everything they do, whether it's operating people's desktops or
managing the infrastructure or deploying business solutions.
So for Microsoft to be successful in the enterprise, we obviously
have to provide reliable technology and great products. But we also
have to provide real business value. We have to configure these
products, integrate them, sell them, support and service them in a
different way to address the customer need.
These solutions are at the cutting edge of changing Microsoft. Not
taking it away from being a product technology company, because
that's the basis of everything, but translating that product
technology into something customers can use every day that drives
business value. It's very simple.
How much progress has Microsoft made in pitching the solutions
to corporate customers?
I think we're still in the early
stages, to be honest. In terms of the sales force, which I am
responsible for, we've put what I would call the infrastructure in
to be able to sell these solutions. We've actually changed a number
of things: the cap management model, the compensation model, a
bunch of the sort of systems and processes so that we can sell not
just products and licences, but these much more complex business
solutions and IT solutions.
We've trained about 5,000 people in the field, who are going to be
responsible for either account managing, selling or providing
tentacle support on these solutions.
We're also in the process of engaging partners very closely around
these solutions - both large global systems integrators, who are
going to lead with these solutions, plus what we call certified
partners, who are going to help deliver and customise the solutions
for small and medium-sized customers.
Have you noticed any change in the way corporate customers react
to Microsoft?
There are customers who say: 'We're
surprised when you come in and ask, what's your key business
problem or business challenge?' They're used to Microsoft saying:
'Wow, we've got this new technology to jazz your desktop or to
improve the performance of your servers or whatever.' And they're
still interested in that.
But they're very interested when you ask: 'What are the key
business problems and challenges that maybe some of these solutions
can help?' You can talk to business people as well as IT people
about that. You can talk about the business value of IT. I've been
to 10 countries in the past six weeks, and I just see a dramatic
change in the basic relationship we have with customers.
Can you describe how a typical sale might work?
The
[Microsoft] solutions specialist and the partner would try to
understand obviously your business requirements. We'd configure
[the solution] for you and produce a proposal bid for, basically
the whole system. The whole cost would be software, the
integration, services, everything.
Then we'd say: 'The total cost of this thing is $500,000 [£350,600]
less what you already have licensed from Microsoft. We know you're
already licensed for Windows, SQL Server and Office. So the total
cost is $500,000, but you're already licensed for $200,000, and
that includes service and everything. So what you need in addition
to what you already have is another $100,000 in licences and
another $200,000 in services,' just to make a simple example. 'For
$200,000 in services, you've chosen Avanade or this partner, so you
pay that directly to them. The additional $100,000 you owe in
licences to Microsoft.'
Depending on what agreement you have - an Enterprise Agreement or
Select - that can be added on to that existing agreement. So that
would flow through whoever the reseller was that sold you that
agreement. You don't have to sign a whole new agreement or
renegotiate it. It's just an add-on to whatever agreement you
already have. It's designed to be as straightforward as we can make
it.
We want to tell the customer the total cost of the system, because
then we can say: 'It's going to cost you $500,000, but it's going
to increase your bottom line by $2m by driving this amount of
revenue or this amount of cost savings.'
We want them to look at it on the basis of the total cost, even if
they've already paid some of the cost, because we're trying to
establish what the business value is and what their return is on
that investment.
What types of solutions packages are due out in the next six
months?
I know the ones we're developing, but it's hard
to predict the order they come out. We're doing a bunch around the
IT area, particularly around security, management, data centre
infrastructure and new development methodologies.
We're also doing a set around employees, like business intelligence
and productivity solutions based on Office and SharePoint [Portal
Server]. We're doing some more business-partner solutions, too. And
then there are the [solutions that centre on] connecting customers.