This article was originally published on CRN.
Avaya is adding structure and strategy around cloud to its global channel partner program, the company told CRN exclusively.
Given that Avaya does about 80 percent of its business through partners, the company needs consistency in channel leadership across all its geographies if it’s going to succeed in the cloud, Dennis Kozak, senior vice president, Global Channel for Avaya, told CRN.
Kozak was promoted to global channel chief earlier this month when the company kicked off a new, all-encompassing channel strategy that wouldn’t rely only on channel leaders overseeing their respective geographies. As part of that plan, Avaya in September brought on Steven Spears as its first chief revenue officer to handle global sales and a global channel chief for the first time in years to oversee all indirect sales efforts.
The new approach to indirect sales comes at a time where the channel is more critical to Avaya then every before as it pushes its cloud-first portfolio, including Avaya Cloud Office (ACO) Avaya Spaces, and its Contact Center as a Service (CCaaS) suite. Cloud, as opposed to premise-based solutions, aren’t locked into one geography, so channel efforts can’t be either, Kuzak said.
“It’s incredibly important to get this right … it all has to work together as one big, cohesive strategy because we have to keep the lights on and build new business,” he said.
Kozak joined Avaya in 2019 to help aid the company’s transition to the cloud. The company was at the time in talks with RingCentral for its first public cloud offering, ACO, but its channel was still largely focused on hardware and premise-based UC and contact center solutions.
“Cloud is a different sales motion and a different consumption model … and we really launched ACO without a program,” Kozak said. “After ACO was available for a few months, I knew there was more to do in the cloud and our channel program wasn’t quite built for it.”
Avaya is currently working on a channel program that will acknowledge the full scope of their partners’ book of business, including premise-based, subscriptions, and public cloud offerings, Kozak said. Over the past year, the company has updated partner recruitment, onboarding, and compensation within its partner program. Avaya will be tying it all together in 2021 with a partner program that’s “aligned with where the puck is going,” he said.
“Our traditional [Avaya Edge Partner Program] doesn’t take into account cloud business,” he said. “There’s an opportunity for us to pull the service and sales components together and match that up with legacy business to really look at the entire envelope the partner has with Avaya so we can differentiate our biggest and best partners.”
To that end, Avaya will be hiring to support its global, cloud-focused channel efforts. Mike Coleman, former mobility channel chief for Samsung, joined Avaya in December as the company’s new vice president of North America Channel Sales, replacing former North American Channel Chief Jon Brinton, who left the company in September.
“We can’t get away from a geographical execution model. The relationships the [geographic leaders] have in-country is important,” Kozak said. “The strategy, the offerings, the enablement, everything has to be executed by the global partner program. We’ll build out that global team that will build things centrally so they can be deployed locally.”
Carousel Industries, an Exeter, R.I.-based solution provider giant and longtime Avaya partner has sold plenty of Avaya’s private cloud-based offerings over the years, but its ACO business is growing substantially, according to James Marsh, chief revenue officer and owner of Carousel. “Just in two quarters, we’ve already doubled our ACO number of seats,” he said.
The appetite for cloud has only grown, especially in 2020 when clients were concerned about capex expenses, Marsh said. Carousel’s 5,000 plus customer base is still largely on premise-based solutions, so there will continue to be “a big ramp-up” around cloud and CCaaS over the next 18 months.
Avaya’s large, global customer base and its new efforts around transforming the business puts the company in a great position to help businesses evolve, Marsh said. “They have a very good story to move [customers] from the premise to the cloud – they’re the best people to do it – and we can drive that adoption and enablement as a partner,” he said.
Once considered a premise-based unified communications leader, Avaya’s cloud and software-as-a-service business has doubled in just the past year, Jim Chirico, president and CEO of Avaya, told CRN in November. Much of that growth is due to channel partners, he added.
“The channel generated about 75-80 percent of our subscription revenues and we doubled the number of cloud customers this quarter,” Chirico said. “A significant uptick that was predominantly driven by the channel, who is transforming with us.”
Revenue for Avaya’s Cloud and Alliance Partner segments, as well as subscriptions, climbed each quarter in 2020. These three areas now account for 33 percent of Avaya’s total revenue in the fourth quarter of 2020, which ended Sept. 30, compared to 18 percent in the first quarter of 2020. The company expects Cloud, Alliance Partner and Subscription to represent between 35-40 percent of Avaya’s total revenue in 2021, according to the Santa Clara, Calif.-based company.