Everyone knows that Microsoft is moving aggressively to enter the enterprise applications market, with its acquisition of Great Plains and Navision earlier this year, as well as its development of its own enterprise CRM systems and other applications. This is old news.
But what is not generally recognized is that Microsoft is heading for trouble in how it is signing up resellers. Anecdotal evidence indicates that Microsoft is showing no restraint in how many resellers it signs up in a given geography, as if the more the merrier.
This was the mistake that Baan made in the late 1990s, when it signed up many resellers without considering that they might be competing against each other. During this period, I was doing a software vendor selection where three Baan resellers were attempting to sell to my one client, and none of them would back off. Apparently, even Baan couldn't control the situation because they eventually told me that I
should make the decision on which reseller to use.
I see the same thing happening shortly with Microsoft, as its Great Plains, Navision, and Axapta resellers watch Microsoft merrily signing up additional resellers down the street.
Whoever is in charge in Redmond/Fargo needs to understand that selling enterprise applications is not the same as selling Win2000, Exchange, or SQL Server seats. These are complex sales with long lead times. One of the little secrets of selling enterprise applications in the mid-tier is that although the reseller channel is key, it is also limited. There are not many good or great reseller organizations. When you find good ones, you don't turn around and undercut them by creating competitors next door.
For more discussion, see my post on Axapta
and my post on unintended consequences
of Microsoft's move into enterprise systems.