As SAP’s business expands, the new leaders pay closer attention to its partners as the contributors to widening out the company’s business as it leverages the cloud as the key product in the market and appoints a new chief partner officer, Karl Fahrbach, to take on the challenge.
Jim O’Donnell from TechTarget reported about the transformation taken by the SAP partner program to make it more relevant for the ever-changing environment of businesses and technologies.
It is no secret that SAP partners are usually focused on ensuring that SAP systems were sold and implemented. These partners were crucial contributors in building and expanding the SAP ecosystem through application integration, consultations, reselling, system design and other services. Over time, SAP’s product portfolio has widened, and the cloud has become an even more critical service that can potentially bring more growth to SAP; hence, the SAP partner program takes a detour from sales to customer success.
This change in strategy does not mean SAP wants its partners to skip the selling aspect for its products. Instead, the cloud-centric environment is encouraging them to go the extra mile by building applications for customers that will ensure a stronger relationship even after the implementation is completed.
In this case, the new partner model will boost the intelligent enterprise which SAP referred to as an organisation that leverages next-gen tech to transform existing business models and processes. Future customers are not the only ones encouraged need to make the shift to become an intelligent enterprise. Almost a year ago, SAP began to push the need for partners to build skills in preparation for the intelligent enterprise.
Karl Fahrbach answers important questions about the partner program
A Q&A session was conducted by O’Donnell with SAP’s chief partner officer (CPO), Karl Fahrbach. He was appointed as the first CPO to drive SAP’s intention to become a partner-focused company. During the session, several items regarding the SAP partner program were clarified, including those that will impact the business in the future.
When asked about the reason why the SAP partner program shifted its focus from sales and implementation to customer success, he explained that the primary model for the partners was implementation. Eventually, the company has acquired companies that were followed by the introduction of the intelligent enterprise with ERP as the core. Additionally, the company had line-of-business solutions that were launched alongside the SAP Cloud Platform.
Fahrbach referenced the study conducted with IDC, which revealed that the partner economy would double in the next five years because of SAP’s bigger portfolio. But, ultimately, the company were skeptical about their partner program’s capacity to support that expected growth. This led to the development of a partnering initiative that is more beneficial for the partners. Additionally, Fahrbach emphasised the importance of the cloud with customer success as the key performance indicator.
Quality vs. Quantity
Karl Fahrbach shared that the new partner program will add more focus on the quality side. He shared that this will also benefit smaller firms that have helped faster adoption of SAP products and is looking to reward the efforts accordingly despite the lack of sales based on a different set of metrics.
When asked about the methods they use to track the new metrics, Fahrbach shared:
“We’ve changed the way that we get feedback from partners, and we’ve also established a partner advisory council, with everyone from the big SIs to small boutique partners. We’re working on ways to provide a better partner experience and better access to innovation technologies.”
The relevance of the CPO role
In the interview, O’Donnell asked the relevance of opening the position of CPO, which is quite rare in the software industry. Fahrbach answered that partner business can potentially be SAP’s innovation driver. Innovation changes fast that it has become challenging to catch up to its pace without increasing developers. This led to the strategy to utilise partners; hence, the need for a CPO.
Fahrbach shared that he expects the new partner model will be retained despite the recent changes to SAP’s leadership. He emphasised that the co-CEOs, Christian Klein and Jennifer Morgan, put a lot of focus on the partner business and are interested to see how the partners will contribute more to SAP’s business. Additionally, he guaranteed that the board pushes the commitment for the partner business.
The session ended with Fahrbach comparing the old relationship with the partners as merely a medium for implementing systems and servicing markets. He stated:
“Now the partner business is where the partner will always be involved in creating value for the customer. That’s the mindset that we’re trying to shift to.”