5 ms·

This is so strange to observe from the outside. The statements of Gavriella Schuster, when that whole debacle started, provided some insight into the partner pr

This is so strange to observe from the outside. The statements of Gavriella Schuster, when that whole debacle started, provided some insight into the partner program: "We can't afford to run every single partner's organisation for free anymore, because it's not free" "Put it this way, when customers are paying for services they turn them off very quickly. When we give it away for free the partners leave these services on. While my budget has to pay internally for this." "We have given partners a year to figure this out. I just can't make it free anymore." "If we hadn't had such an influx of new partners and everyone's usage hadn't been this high, then we may not have been in this situation" The article, where these quotes are from, talks of 7000 new partners each month [1]. So, on one hand, Microsoft clearly has a communication problem. The proposed changes slipped in without a clear, official statement and wasn't the backlash obvious? Why didn't anyone stop Schuster from doing this? On the other hand, how can they continue like this? They lose huge amounts of money because partners get a ton of licenses for free. So what's their plan? Unfortunately the announcement is as shallow as possible. Hard to regain trust this way. But many development shops, as the one I'm in, are so dependent on Microsoft and the partner program, that switching is nearly impossible... [1] https://www.dailytimes.live/business/microsoft-cuts-partner-benefit-surprise-move-88246844 https://www.dailytimes.live/business/microsoft-cuts-partner-...

drawkbox 7y ago
This highlights why budgets and metrics don't always tell the full picture. The manager/bizdev/MBA on the team sees a loss to their budget. To CYA they want to fix that budget issue, but they are only looking at the short term cost not the long term. The "I just can't make it free anymore." statement shows this with the "I" word, only thinking of their short term focused budget. But the long term point is this: > But many development shops, as the one I'm in, are so dependent on Microsoft and the partner program, that switching is nearly impossible... Most Microsoft partners have high switching costs, higher because they get lots of it free, so developers/network/technology teams are locked into Microsoft due to this. These policies helped build the Microsoft product adoption. Just as anything that is free, some of those free licenses led to pay licenses, and some wouldn't be used at all without free licenses. I have seen this with many Microsoft products and it is really how products like Windows and Photoshop came to such widespread use, people got it free or pirated it and eventually the purchases came. It appears this manger/product lead is more focused on the business metrics of short term and right now rather than historical policies that locked lots of teams/partners to Microsoft. This plays out over and over at organizations: - If the engineers/designers/developers/product people win, they keep the long term programs and research and development going that builds better products to bring people in making marketing and business multipliers easier. - If bizdev/managers/MBAs win, they cut all that out because short term it looks better to them. To them the 'open' mode [2] and research and development or free programs hit the immediate bottom line but it may not be clear how much they are responsible for the products that are marketable. Much of that is customer adoption due to good policies around engineering/product/design that these types start to strip away because they don't have a clear ROI but may in fact be a big reason for success. A bit of the Ballmer era tried to come back from the dead, they put it under the lake like Jason Voorhees from Friday the 13th for a while again. This is the age old battle in innovative/technology/product companies. Looks like the engineers/product/developer side won this round which is a good sign for Microsoft. Bizdev/MBA/manager/marketing/metric focused companies kill the long term product lifeline and the 'open' mode every single time [2][3] This is also mentioned in 'How Software Companies Die' which is almost law now: > "The environment that nurtures creative programmers kills management and marketing types - and vice versa." [1] I wonder when this knowledge will make it back to HBS MBA business school, there are plenty of examples in the market. Business and marketing should be the multiplier of your value, they are not the value creators. The product / engineering / creative / research / development / design departments and the people you have are the value creators and customers are also a stakeholder that must be considered long term not just short term. Product development has two sides, value creation (engineering/design/product) and value extraction (MBA/bizdev/marketing). It is a balance, when one side has too much power, it kills the product but much faster on the value extraction side. In most cases, lack of power in the value creation side ends the company or leads to stagnation because all the value and grace is extracted. [1] http://www.call-with-current-continuation.org/rants/how-companies-die.txt http://www.call-with-current-continuation.org/rants/how-comp... [2] https://genius.com/John-cleese-lecture-on-creativity-annotated https://genius.com/John-cleese-lecture-on-creativity-annotat... [3] https://news.ycombinator.com/item?id=20353914 https://news.ycombinator.com/item?id=20353914
- remarkEon 7y ago
  >I wonder when this knowledge will make it back to HBS MBA business school, there are plenty of examples in the market. It has, but there's a fundamental incentive problem that I have to wonder might be a byproduct of how younger people are switching jobs so often. You can get a lecture about long-term growth and read 100 case studies about this, but at the end of the day in order to get promoted in your bizdev/MBA role you have to show some accomplishment that you can quantify and put on your resume. You could probably ask these people if they thought this particular change in this particular manner at this particular time was the best long term strategy for the business, and I'd be willing to bet that a lot would have said "no, but we have to do it anyway."
  - drawkbox 7y ago
    Very true, short term is self-interested and you have to be in today's corporate world, especially in the value multiplication/extraction/funding side. I have no doubt Gavriella Schuster figured it would help her budgets and maybe provide growth through some converted customers. But that is short term as really the licensing model of many systems are dying and no one would ever recommend SharePoint if they couldn't use it for free to develop on and use internally. Some products would die faster without the partner program and the licensing model is ancient due to the cloud in favor of per-use/subscription/SaaS, licensing really only works for consumer products but even then it is tough. Microsoft already knows this as Azure is essentially their main product instead of OS going forward. So this move just seems badly timed. The other reason people are so short term focused, especially in the management/budget side, is that building value takes lots of time and is risky to budgets. Therefore budgets are guarded heavily to focus on P&L which overrides research and the open mode needed to create products. Simply doing something that is short term does damage but ultimately brings in short term gains (budget savings), those results can be quantified and seen as a good short term solution while most of these people are long gone before the network effects of that change are realized. Building value takes time and that is why large companies buy up startups, they are value-focused. Even Apple with the iPhone really used all the R&D at NeXT/NeXTSTEP to move so fast and have such a solid market leading launch. Ultimately value creation rules the world, it is just the value creators are usually overruled eventually by the extractors.
voidwtf 7y ago
I work for a software dev company that uses and advocates for Microsoft’s platform. Many of the solutions we’ve sold and/or suggested to our customers have been based on our internal use of the same platforms and feature levels which we use to dogfood and demo the product we develop. Some features or solutions we’ve developed for our customers are reliant on our exposure to Microsoft products we would not be able to justify or afford outside the partner program. If the partner program had not been available those solutions would have been based off alternative products, most likely open source. The most likely jump we would have made already is from SQL Server to Postgres. In that instance alone, the SQL Server licenses our product/solution has led our customers to make far exceeds our IUR usage. I can’t imagine we’re alone in the scenario. There is no way our small company could justify purchasing the enterprise licenses we routinely suggest our customers purchase.
- sjellis 7y ago
  > I can’t imagine we’re alone in the scenario. There is no way our small company could justify purchasing the enterprise licenses we routinely suggest our customers purchase. This is probably the norm for smaller partners. You could use Open Source alternatives, or other cloud providers, so Microsoft have to offer a better or a more convenient package.
- darkcha0s 7y ago
  >Some features or solutions we’ve developed for our customers are reliant on our exposure to Microsoft products we would not be able to justify or afford outside the partner program. If the partner program had not been available those solutions would have been based off alternative products, most likely open source. Just a question- what exactly are you developing within the Microsoft ecosphere that's so expensive? Prototyping new solutions with Azure these days is definitely pretty cheap, even without being an MSFT Partner.
  - voidwtf 7y ago
    This is partially true, Azure has made some of these options available in a more affordable format. Additionally some features have been made available in lower level licenses. One example is any solution utilizing encryption at rest, a feature that was previously only available in enterprise level SQL Server. That feature is now available in lower license levels and Azure.

drawkbox 7y ago

This highlights why budgets and metrics don't always tell the full picture. The manager/bizdev/MBA on the team sees a loss to their budget. To CYA they want to fix that budget issue, but they are only looking at the short term cost not the long term. The "I just can't make it free anymore." statement shows this with the "I" word, only thinking of their short term focused budget. But the long term point is this: > But many development shops, as the one I'm in, are so dependent on Microsoft and the partner program, that switching is nearly impossible... Most Microsoft partners have high switching costs, higher because they get lots of it free, so developers/network/technology teams are locked into Microsoft due to this. These policies helped build the Microsoft product adoption. Just as anything that is free, some of those free licenses led to pay licenses, and some wouldn't be used at all without free licenses. I have seen this with many Microsoft products and it is really how products like Windows and Photoshop came to such widespread use, people got it free or pirated it and eventually the purchases came. It appears this manger/product lead is more focused on the business metrics of short term and right now rather than historical policies that locked lots of teams/partners to Microsoft. This plays out over and over at organizations: - If the engineers/designers/developers/product people win, they keep the long term programs and research and development going that builds better products to bring people in making marketing and business multipliers easier. - If bizdev/managers/MBAs win, they cut all that out because short term it looks better to them. To them the 'open' mode [2] and research and development or free programs hit the immediate bottom line but it may not be clear how much they are responsible for the products that are marketable. Much of that is customer adoption due to good policies around engineering/product/design that these types start to strip away because they don't have a clear ROI but may in fact be a big reason for success. A bit of the Ballmer era tried to come back from the dead, they put it under the lake like Jason Voorhees from Friday the 13th for a while again. This is the age old battle in innovative/technology/product companies. Looks like the engineers/product/developer side won this round which is a good sign for Microsoft. Bizdev/MBA/manager/marketing/metric focused companies kill the long term product lifeline and the 'open' mode every single time [2][3] This is also mentioned in 'How Software Companies Die' which is almost law now: > "The environment that nurtures creative programmers kills management and marketing types - and vice versa." [1] I wonder when this knowledge will make it back to HBS MBA business school, there are plenty of examples in the market. Business and marketing should be the multiplier of your value, they are not the value creators. The product / engineering / creative / research / development / design departments and the people you have are the value creators and customers are also a stakeholder that must be considered long term not just short term. Product development has two sides, value creation (engineering/design/product) and value extraction (MBA/bizdev/marketing). It is a balance, when one side has too much power, it kills the product but much faster on the value extraction side. In most cases, lack of power in the value creation side ends the company or leads to stagnation because all the value and grace is extracted. [1] http://www.call-with-current-continuation.org/rants/how-companies-die.txt http://www.call-with-current-continuation.org/rants/how-comp... [2] https://genius.com/John-cleese-lecture-on-creativity-annotated https://genius.com/John-cleese-lecture-on-creativity-annotat... [3] https://news.ycombinator.com/item?id=20353914 https://news.ycombinator.com/item?id=20353914

remarkEon 7y ago
>I wonder when this knowledge will make it back to HBS MBA business school, there are plenty of examples in the market. It has, but there's a fundamental incentive problem that I have to wonder might be a byproduct of how younger people are switching jobs so often. You can get a lecture about long-term growth and read 100 case studies about this, but at the end of the day in order to get promoted in your bizdev/MBA role you have to show some accomplishment that you can quantify and put on your resume. You could probably ask these people if they thought this particular change in this particular manner at this particular time was the best long term strategy for the business, and I'd be willing to bet that a lot would have said "no, but we have to do it anyway."
- drawkbox 7y ago
  Very true, short term is self-interested and you have to be in today's corporate world, especially in the value multiplication/extraction/funding side. I have no doubt Gavriella Schuster figured it would help her budgets and maybe provide growth through some converted customers. But that is short term as really the licensing model of many systems are dying and no one would ever recommend SharePoint if they couldn't use it for free to develop on and use internally. Some products would die faster without the partner program and the licensing model is ancient due to the cloud in favor of per-use/subscription/SaaS, licensing really only works for consumer products but even then it is tough. Microsoft already knows this as Azure is essentially their main product instead of OS going forward. So this move just seems badly timed. The other reason people are so short term focused, especially in the management/budget side, is that building value takes lots of time and is risky to budgets. Therefore budgets are guarded heavily to focus on P&L which overrides research and the open mode needed to create products. Simply doing something that is short term does damage but ultimately brings in short term gains (budget savings), those results can be quantified and seen as a good short term solution while most of these people are long gone before the network effects of that change are realized. Building value takes time and that is why large companies buy up startups, they are value-focused. Even Apple with the iPhone really used all the R&D at NeXT/NeXTSTEP to move so fast and have such a solid market leading launch. Ultimately value creation rules the world, it is just the value creators are usually overruled eventually by the extractors.

voidwtf 7y ago

I work for a software dev company that uses and advocates for Microsoft’s platform. Many of the solutions we’ve sold and/or suggested to our customers have been based on our internal use of the same platforms and feature levels which we use to dogfood and demo the product we develop. Some features or solutions we’ve developed for our customers are reliant on our exposure to Microsoft products we would not be able to justify or afford outside the partner program. If the partner program had not been available those solutions would have been based off alternative products, most likely open source. The most likely jump we would have made already is from SQL Server to Postgres. In that instance alone, the SQL Server licenses our product/solution has led our customers to make far exceeds our IUR usage. I can’t imagine we’re alone in the scenario. There is no way our small company could justify purchasing the enterprise licenses we routinely suggest our customers purchase.

sjellis 7y ago
> I can’t imagine we’re alone in the scenario. There is no way our small company could justify purchasing the enterprise licenses we routinely suggest our customers purchase. This is probably the norm for smaller partners. You could use Open Source alternatives, or other cloud providers, so Microsoft have to offer a better or a more convenient package.
darkcha0s 7y ago
>Some features or solutions we’ve developed for our customers are reliant on our exposure to Microsoft products we would not be able to justify or afford outside the partner program. If the partner program had not been available those solutions would have been based off alternative products, most likely open source. Just a question- what exactly are you developing within the Microsoft ecosphere that's so expensive? Prototyping new solutions with Azure these days is definitely pretty cheap, even without being an MSFT Partner.
- voidwtf 7y ago
  This is partially true, Azure has made some of these options available in a more affordable format. Additionally some features have been made available in lower level licenses. One example is any solution utilizing encryption at rest, a feature that was previously only available in enterprise level SQL Server. That feature is now available in lower license levels and Azure.