Microsoft on plans to offer users SKU service

20.07.2005
Von Carol Sliwa

During a keynote address at Microsoft Corp."s Worldwide Partner Conference, CEO Steve Ballmer said the company will offer managed services that are designed "more like a product or a standard offer and less like a set of customized outsourcing services." Rick Devenuti, senior vice president of Microsoft Services & IT, recently talked about those service plans with Computerworld.

Excerpts from the interview follow:

When did you get this idea for the service stock-keeping units? We"ve been working on our three-year strategy for about six months, and as we started this year, we realized there are opportunities for us to change our model. The whole integration of IT and the work we do internally, with what we do with customers, made it a natural evolution. We put this organization together about 18 months ago, and there"s a reason we did it. We"re just trying to get value out of it.

Are there certain types of services that will be more conducive to the SKU approach? We don"t have a whole list of where we"re going with SKUs. We"ve got a product marketing organization that will make sure it looks at the opportunities. But I think essentially the platform opportunities are things we know we can do because we do "em inside and we do "em with customers. Where customers are having pain today, you look at that and understand what part is difficult and how do we solve that -- or where customers have adopted technology, but they"re not using it productively. Customers ask us all the time: "We want to run it just like you do. You"re successful with it. How can we be successful?"

So you like the idea of productizing services as much as possible? I"m not saying it"s the only way to do it. I"m saying it"s a way we know that works. We"ve codified it. We"ve tested it. We"ve proven it. And why not share that? Frankly, it"s something IT can"t do. They"ve got day jobs. It"s something that our consulting and support organization can do. And it"s something that as we have to train our support people and our consultants, we absolutely can build the same [intellectual property] for partners.

What will be the first SKU? The first one is around Exchange [Server]. It"ll be a combination of SKUs, starting with looking at the overall health of the environment. How do you measure it? How do you monitor it? What"s the availability of [the customer"s] Exchange Servers worldwide? ...[It will grow] to how do you deploy and how do you really support it once it"s in place.

When will Microsoft introduce the first one? We"ll be using it internally in this half of the [fiscal] year, and we"ll be offering it to partners some time during the second half. We"ve got a lot to learn about the difference between what this concept is and how you train somebody to do it. Today, they suggest we take people out of IT and marry them with consultants. But that doesn"t scale. There"s really got to be training. There"s got to be certification, or accreditation.

Will customers at some time in the future be able to find a catalog of SKUs for services? Yes. We want to broadly market these SKUs, and they can be delivered by Microsoft or by partners. I don"t think it"s something customers will do for themselves, because you need to be accredited and trained on it.

Will Microsoft ever be the sole service provider, or will you always work in conjunction with partners? Certainly, in the original stage we"ll do it because we"ve got to prove it. We"ve got to build it. And we"ve got to market it, because unless there"s a broad umbrella that says one of these Microsoft things is good and there"s proof points to it, there"s no way to scale it up. So we"ll start with them. But the only way to really reach velocity is to have partners enabled to do that.

Will the service SKUs be offered under Microsoft Consulting Services? For both Microsoft Consulting Services and in Premier [Support]. I tend to think of those two organizations as our enterprise services group.

Does this put you into competition with your partners to some degree? I don"t think so at all. We"re really talking about building out an asset for the partner and customer channel. But we have to prove that it works. And this concept of having a very prescriptive way to do something that works in a heterogeneous environment, that gets the guaranteed predictable results we"re talking about, we haven"t found it to be an easy thing to do. So we need to make sure that we can do it and we know how you need to be trained to do it and that you can do it profitably.

Will the new services put Microsoft in competition with IBM Global Services or companies like that? It"s certainly our intent to make sure that Exchange is the preferred messaging platform worldwide, and if that"s in competition with other messaging environments, I guess that"s true. But we are partner-led. We"ll continue to be partner-led.