Wednesday Aug 17, 2011

Issue 11: EMEA VAD Strategy




Markus Reischl

Markus Reischl
Senior Director Distribution and Partner Development, Europe, Middle East & Africa
Oracle Alliances & Channels

Last fiscal year Oracle streamlined its Value Added Distributor (VAD) channel, typically defining two VADs in each geographic region, ensuring effective coverage of both hardware and software. It has been a realignment of the VAD landscape that will ensure Oracle VADs develop rich hardware, software and joint distribution legacies. Understandably, it can prove a steep learning curve for some to embrace 'the other half' of the technology world. However, in every case these VADs are coming out of the other side of the process strongly and with more purpose and direction.

Of course one of the most traditional challenges for VADS remains the same—differentiating in crowded markets by delivering superior services, unrivalled expertise, access to the best technology around, and providing value-added solutions that deliver direct business benefits.

In this interview Markus discusses the positioning of Oracle's partner distribution strategy for the EMEA region, explains what qualities VADs must demonstrate to grow their businesses with Oracle as an invaluable part of the Oracle partner ecosystem, and expands upon the challenges VADs must now meet in order to unlock new revenue opportunities arising from combined hardware and software solutions.

What is Oracle's strategy for value added distribution in EMEA?

Our strategy can be summed up quite simply: coverage. Our VADs help us to scale and manage market and partner coverage. With midsize businesses in particular, Oracle VADs actively support the market and business development with our SI, VAR and ISV partners. To give you some idea of the coverage challenge, there are already 6,000 ISVs in EMEA. Most of them operate in the midsize business. Our VADs cover the existing base while helping Oracle recruit new partners. When working with resellers our VADs also guide first-transaction partners towards the Oracle Remarketer Program.

So, in a nutshell, our VAD strategy is about how we leverage on the total addressable market via market and business development activities and recruitment of new partners. But this also demands an exceptional ability to deliver on the 'V' in VAD.

The first way VADs can do this is in demonstrating operational excellence by supporting Oracle in optimising order processing and driving partner lifecycle management. They can handle a lot of administrative actions for us so we can, in turn, free up more field resources to develop key partners. They support our partners in meeting the credit limits for partners that want to transact at a high level with Oracle, and they can make themselves the single point of contact, or the face of Oracle, for those transactions.

Secondly, it's important for us to understand that VADs themselves are such efficient sales and marketing machines: capable of driving lead-generation programmes with partners, taking the product content we provide through marketing and then designing their own campaigns around those resources.

Third is the Oracle Remarketer Program as already mentioned. And fourth is the VAD's role in supporting us in training and enabling partners around sales and presales readiness and to make sure they understand the benefits of becoming OPN Specialized.

What qualities are you looking for in a top performing VAD?

A top performing Oracle VAD will have taken on the competition directly and risen to the main challenge of bringing both software and hardware to market with impressive additional value. They would either be a software specialist that has skilled-up significantly on the hardware side, or a hardware distributor that has begun excelling in software.

Oracle wants to drive the idea of going to market with this total infrastructure sell and the leading VADs in EMEA have certainly got the message and know what we now expect going forward. After the recent consolidation process we selected the VADs we knew were capable of achieving this, and were happy to invest the resources necessary to go to market with both hardware and software. The top four VADs are already well underway with this and some smaller VADs are undergoing intense 'Ramp-Up' training programmes.

What support are VADs in EMEA providing for partners to for sales and OPN Specialization?

A large part of these activities are encapsulated by the particular OPN Specialized training and enablement programmes that some of our VADs have initiated and are running successfully. Our leading VADs operate their own OPN Specialized training programmes to increase the 'sales readiness' of our transacting partners. In this newsletter you can read about the branded programmes with guided learning paths offered by Avnet, Arrow, Tech Data Azlan and Altimate. These dynamic VADs are creating a pull from the market by actively assisting their reseller partners to achieve specialization through their own branded training. I strongly recommend our partners take full advantage of all the resources and programmes being made available by the VADs in EMEA as this will help them to really achieve their targets.

We are currently educating VADs around high impact sales plays (HISPs) and Optimized Solutions. The dedicated training schedules and workshops around the sales plays, marketing resources and tools for partners are really driving expertise in database and application acceleration such as flash and multi-threaded applications with SPARC T-series servers, and Optimized Solutions such as ZFS storage appliances. This is an area where our VADs can really add a lot of value to partners. You can read more about these solutions in Paul Thompson's article in this newsletter.

Some final thoughts?

At Oracle we value our VADs extremely highly. They provide invaluable services to both Oracle and partners, and really keep the business moving. Last year, on the software side, VADs accounted for 30 percent of all Oracle direct revenue. With a renewed focus on software and hardware engineered to work together, we're now looking to VADs to transact close to $1 billion with us in the EMEA region alone.

Together we'll reach our targets and really skill-up VADs in both hardware and software, and then we'll all do some really impressive business over this new fiscal year.

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