SAP Moves to Expand Its Cloud Channel Base
SAP is looking to expand the base of partners for its portfolio of cloud offerings with today's launch of a referral program that compensates partners for generating leads that result in new cloud services contracts.
Announced at the SAP SME Summit today, the referral option that's being added to the SAP PartnerEdge Cloud Choice program provides partners with a finder's fee for deals that eventually get closed by SAP or one its partners. The referral option complements an existing profit option in the program under which SAP partners can be rewarded with up to 20 percent of the annual revenue generated via a cloud service contract.
In addition to trying to get new partners to participate in SAP channel programs, Rodolpho Cardenuto, SAP president of global channels and general business, said the company is also trying to motivate its existing 15,000 partners to sell more cloud services. Speaking of those partners, he said that only about 7,000 are active, meaning that they sell an SAP product or service at least every other quarter.
"We're giving partners a fee to participate in our business," said Cardenuto.
Donald Dickinson, president of Dickinson & Associates, said that as an SAP partner, the decision to participate in the referral versus profit options would come down to individual products and customer requirements. He added that, rather than considering these options as alternatives, his firm would take advantage of both as circumstances warranted.
The best part about recurring revenue and the cloud overall, Dickinson said, is that it forces a solution provider to re-evaluate relationships with its end customers. "It forces us to think more about the long-term value of the relationship with the customer," he explained.
The growth of the cloud has made much of the nomenclature used to describe types and classes of partners obsolete, according to Rohan Bose, an industry analyst with AMI-Partners. Most partners today are routinely employing multiple business models. For example, they might resell a product or service one day and act as an agent the next.
"It's part of the whole transformation of the channel," he said.
Of course, not every partner is as far along in the transformation process. But as more deals incorporate products and services delivered via the cloud, it's only a matter of time before most channel partners begin to transform their companies—regardless of how ready they may be.