SAP To Start PartnerEdge Channel Program Overhaul Next Month

SAP is readying a lengthy and "significant" overhaul of its PartnerEdge channel program that will ditch the traditional categorization of partner types in favor of working with partners based on how they engage customers.

The updated PartnerEdge also will include a new "Open Ecosystem" element for solution providers who are considering becoming an SAP partner and partners who want to expand their SAP services and offerings.

"On Aug. 31, the next generation of SAP PartnerEdge is going to launch," said Diane Pereira, senior director of global partner marketing, during a conference call Tuesday billed as a midyear update for SAP's channel efforts. "It's the most significant evolution of our program in its 10-year history," Pereira said.

[Related: Gilroy Leaving Channel Executive Post At SAP]

The call also marked the swan song of Kevin Gilroy, senior vice president and general manager of the software company's global small and midmarket segment, who CRN reported last week is leaving the company.

"You've always been so professional. You've energized me, you've inspired me," Gilroy said on the call to SAP's partners. And he called his channel management team "absolutely the best team I've ever worked with in this industry in 32 years."

"My final message is keep the transformation going," he said. "The status quo is more dangerous than the unknown."

SAP has not yet named a replacement for Gilroy. Rodolpho Cardenuto, president of SAP's Global Partner Operations (GPO) is taking on Gilroy's duties in the interim.

Mark Mueller, senior vice president and chief innovation officer with SAP partner Itelligence, based in Cincinnati, lamented Gilroy's departure. "Any time you lose an executive that has a lot of experience in the channel, it's a loss for channel partners," he said in an interview with CRN. He's interested to see who SAP names to take over his post.

SAP now has some 13,000 channel partners worldwide, Cardenuto said, and more than 1,000 were on Tuesday's call. GPO is expected to generate 1.5 billion Euros in revenue (about $1.66 billion) in revenue this year and partners are responsible for 80 percent of SAP's 293,500 customers.

Mueller said Itelligence's SAP business is robust as customers have begun implementing the vendor's Simple Finance applications, a component of the next-generation SAP S/4HANA business application suite. Customers are buying into SAP's HANA and in-memory computing message, Mueller said, and he's looking forward to the availability of the suite's new logistics applications due late this year.

While many details about the PartnerEdge program update have yet to be announced, Pereira said a major change is that the program will support partners using a "single, holistic model" rather than narrowly categorizing solution providers as VARs, systems integrators, OEMs and so on. That's because the line between different partner types is blurring.

"There's a new reality. Partner business models are changing," she said, noting that the program is currently built to support volume sales.

SAP will now work with partners by focusing on how they engage with customers, based on how they build, sell, service and run SAP-based solutions, Pereira said. And all revenue from those offerings will count toward partners' program level and the rewards they receive.

The upgraded program will have simplified electronic contracts, standardized fees and streamlined tier benefits.

The new Open Ecosystem will provide opportunities for solution providers who want to try out being an SAP partner before fully committing to it, Pereira said. It will also serve current SAP partners who are considering expanding their SAP business, such as a partner that sells SAP Business One, but is considering adding other product lines like SAP Business All-in-One or SAP Business ByDesign.

Pereira said Open Ecosystem would replace SAP's Extended Business Member and Authorized Reseller programs.

Pereira said SAP would begin rolling out the first phase of the PartnerEdge update Aug. 31, with other phases extending into the second half of 2016.

PUBLISHED JULY 28, 2015