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The Master VAR's growing role in the Microsoft Dynamics channel

Microsoft's goal with the introduction of her new MPN partner program a few years ago was to raise the bar. The company wanted to do more business with a smaller number of Microsoft Dynamics partners. From that moment on, that select group of partners got more attention and more resources to grow faster.

Due to these steps, a considerable portion of the partner channel ended up under Microsoft's radar. They were not managed by the Microsoft Partner Account Managers (PAMs) and had, at best, contact with a given tele-PAM. But usually there wasn't any form of support at all. We're talking about the small(er) partners here, of course, the ones who generally provide only a small contribution to Microsoft's turnover. But, all told, it did comprise many of these small(er) partners. And this group continued providing substantial sales volume.

The lack of attention did not really help these partners' sales. The obvious result was that Microsoft stood to lose a lot of ground at the lower end of the market. To stop this loss, Microsoft thought up the "Master VAR" concept. This was actually a confusing name, one that might better have been called a "Value Added Distributor." The initial thought was that larger VAR's could operate as a sort of umbrella for smaller partners. In some countries, like the US, the Master VAR role has been implemented this way. In other countries, like many in western Europe, this role was given to distributors from the Microsoft classic channel or to Partner Development Centers (PDC's). While there are differences depending on the country or region, the Master VAR approach typically supports a range of important business needs of its sales affiliates: certification with Microsoft; initiating and coordinating activities such as sales support, second-line support and order processing; BREP administration; training and coaching and, finally, marketing. This last item is actually a Master VAR's main activity, since marketing is generally considered to be the partner channel's Achilles heel.

Participating partners are called sales affiliates. They can continue their activities under their own names (though some Master VAR programs do require some branding updates) without being burdened by all the Microsoft partner rules and complexity. And together, sales affiliates can win and deliver projects that they might never have won individually. This concept has already been activated in several larger Dynamics countries and regions such as the US, Australia, Germany, India, Spain and Western Europe. In some other countries, Microsoft is still looking for suitable partners. Today, most Master VARs focus on the Dynamics GP and the Dynamics NAV product lines. But this concept seems to have a natural fit with the SME part of the Dynamics CRM channel as well! 

Now that Microsoft has decided to reduce the number of PAMs drastically and to give the remaining PAMs a more commercial role as Partner Sales Executive's (PSE), there's a chance that an increasing number of Dynamics partners will end up in the Master VAR domain - if not all of them. It will then be up to these Master VARs to support, inspire, and motivate these partners toward new successes.

Guus Krabbenborg's tenth annual Business Report from WPC is available now! You can view the 2013 table of contents for the WPC 2013 Business Report and download the 2012 report here.

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Guus Krabbenborg
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