Oracle Corp. is cracking open its top North American accounts to allow partners to get their share of the very lucrative pie.
Rauline Ochs, group vice president of Oracle's North America Alliances and Channels, on Tuesday briefed the media about the program, which Oracle has dubbed the "Cover the Subsidiaries" program.
The new program will allow Oracle's 2,800 North American partners to sell their goods and services to subsidiaries of Oracle's biggest, most strategic accounts, all of which exceed $1 billion in annual revenues.
Most of these mega-companies have geographically far-flung subsidiaries that make it tough for one Oracle sales rep to cover, Ochs said. "It's hard for one person to cover 20 cities," said Ochs, in Redwood Shores, Calif. "But once [an Oracle] partner has identified himself to the Oracle sales rep, we now can have a good relationship between Oracle and its partners."
The program's biggest benefit, Ochs said, will be the extension of Oracle's reach by leveraging Oracle partners across the country to reach into subsidiaries.
Oracle piloted the program between January and May, using as a template an Oracle Partner Network program called OMM (Open Market Model). OMM is a partner registration program where partners can register opportunities for reselling. The program also allows partners to apply for a referral fee if they find an opportunity they want to pass on to Oracle, or if they influence a sales opportunity by recommending Oracle products. Where OMM is restricted to customers with less than $1 billion in annual revenues, the Cover the Subsidiaries program expands into the over-$1 billion range.
During the four-month trial period, partners generated $1 million from selling into subsidiaries, Ochs said—a promising harbinger of money to be made.
"Here's a net, new $1 million that traditionally wouldn't have been done through the channel that's now being done by channel partners by us opening this new market to our partners," Ochs said.
One of the companies generating these new revenues is FusionStorm Inc., an Oracle reseller that was one of 10 partners to participate in the program's pilot. According to Dan Mori, vice president and co-founder, during the pilot, FusionStorm managed to exploit previous work engagements with companies to churn out two or three new deals that total between $200,000 and $250,000.
That's a positive and tangible sign of change when it comes to Oracle's relationships with partners, and it's testimony to Oracle's determination to turn around its long-sour reputation in this arena. "I'm pleased that Oracle is pushing forward their commitment to the channel partners to try and have a positive engagement between their sales force and their channel partners," said Mori, in San Francisco. "In this marketplace in the past, it had been problematic. The idea that Rauline is trying to push for is more a cooperative, joint sales effort."
One of FusionStorm's new deals involved working with the IT division of a subsidiary of a manufacturer of semiconductor circuit boards to create an Oracle database and application server setup to function as an e-commerce system. For another deal, FusionStorm worked with a consumer lending company's subsidiary to create an online training solution based on Oracle technology. TUSC, a Chicago firm, put together a pharmacy-based technology platform.
Ultimately, the program will benefit clients, Mori said. "There's a lot of additional coverage, attention and added values that resellers can provide in terms of other areas of expertise above and beyond just Oracle," he said.
The news of the program follows fast on the heels of Oracle's recently launched effort to teach its direct sales force to play nice with partners. Late last month, the company began to roll out its first-ever set of guidelines to instruct sales staff on how to identify, respect and work with partners, including channels, ISVs, resellers, integrators and VARs, on accounts.
Click here to read about Oracle's efforts last year to reorganize its sales force.
The numbers behind the program amply reveal why Oracle is so motivated to overhaul its sales force. According to Ochs, Oracle's most strategic accounts have a total of 10,000 subsidiaries. Of those, 2,500 have buying authority, including both budgets and the necessary delegation to buy on behalf of themselves.
The program is now open to all Oracle Partner Network partners, who will be empowered to, for example, participate in quarterly business reviews or to leverage Oracle's telesales organization to create demand, Ochs said.
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