February 22, 2012, 12:49 PM — Two years ago, key IBM channel executives abruptly initiated a sea change in the company's go-to-market blueprint to sell predictive analytics and cloud computing (and other newer technologies) to midmarket businesses.
Long considered an enterprise-centric company, IBM crafted a design, led by Rich Hume -- its global channel chief at the time -- to shift all midmarket sales to channel partners for the largely untapped $250 billion global segment comprised of businesses up to 1,000 employees.
IBM insisted that the idea wasn't merely a public relations move -- the company pledged to redirect more than $100 million in marketing and sales support to underwrite the plan and pulled some 70 direct sales reps off of midmarket accounts to support channel partners.
While disappointing sales to mid-sized businesses formed the strategy's foundation, the nagging question surrounded preparing a large subset of IBM channel partners not only to sell business analytics and cloud technologies but also to convince a new, knowledgeable audience of midmarket CIOs and IT professionals that they were up to the task.
"We were dissatisfied with our results in the mid-market pre-2010," said Hume of the shift in sales strategy. "We realized that complexity was the enemy of how we had gone to market," he said. "We redesigned the model to make business partners the primary route to the midmarket."
IBM knew that reversing its field on midmarket sales wouldn't work if confined to a small group of highly qualified and dedicated channel partners; to succeed it needed strength and expertise in numbers. Of the 10,000 IBM channel partner selling to the midmarket, only about 700 delivered the lion's share of the vendor's business analytics solutions to those accounts while another 300 worked enterprise-class accounts.
And none came armed with a business analytics authorization that certified sales and technical skills to help open doors to the C-suite.
Myths of Analytics Costs and Risks
Mid-sized organizations typically refrain from investing in analytics owing to misperceptions over risk and cost and, conspicuously, an absence of qualified internal staff. But IBM said that its research showed midmarket CIOs were receptive to working with channel partners skilled in the deployment and configuration of analytics technologies to help them hurdle impediments to adoption.
That finding alone confirmed to IBM's channel execs that they were on the right track -- a mix of technology, strategy and market momentum sided with them.
Market Momentum Drives Strategy