Microsoft licensing and contracts are complicated and require very careful attention to detail, and for this reason many customers turn to third party advisory firms to supplement their internal knowledge. These third party firms act as subject matter experts in the area of software licensing and contacts.
I can assure you Microsoft does not like this at all. Internally Microsoft has labeled these organizations as “Third Party Negotiators”, they refer to them as TPNs for short. In fact when a Microsoft suspects or confirms a customer has engaged a TPN, they are required to follow an internal notification and escalation process.
It is interesting that Microsoft has lumped all third party advisory firms into the single category of TPNs. In fact the use of the word negotiator is most interesting, since not all of these firms negotiate for their customers. SoftwareAdvocates® mission is simple – “Make sure our clients do not over pay Microsoft and they stay compliant with Microsoft”, we are not in the negotiation business.
As Microsoft continues turning over its workforce to bring in the next generation of employees the existing employees still have a need and desire to work, and many of those employees possess licensing and contract expertise. As a result these former employees skilled in licensing and contracts are becoming independent consultants to the very customers they use to sell to when at Microsoft.
There are also third party firms comprised of persons who never worked at Microsoft. Some of them come from the Microsoft reseller community and others come from non-affiliated backgrounds. In the last few years the Microsoft TPN community has been steadily growing.
Back in October of 2015 Microsoft posted the job description at the bottom of this article to counter the impact of the TPN community. Clearly they believe TPNs are costing them revenue and they are not going to stand idly by. We will let you be the judge whether the below job description is focused on Microsoft’s best interest or the customers. If you are curious what OTRRR stands for, it is “on time revenue recognition and renewal” and it is a big deal to Microsoft. Thus Microsoft wants to make sure renewals happen on time and are larger than the previous one.
If Microsoft tells you are not permitted to engage a third party firm, then here is some food for thought. The Microsoft Master Business Services Agreement (MBSA) between your organization and Microsoft clearly permits both sides to engage third parties provided proper confidentiality is in place. If Microsoft is asking you to relinquish your rights to engage third parties, please ask them if they are going to relinquish their rights too. We suspect they will say no, so why would you say yes?
If Microsoft ever removes this language from the current MBSA, then you should make sure they never send a third party in place of Microsoft to act on their behalf with your organization, and in case you are not aware Microsoft relies on third parties to conduct audits. As you can see this would present a problem for Microsoft.
Make sure to do your due your diligence when selecting a third party firm, including talking to existing clients. We recommend being very careful of any third party firm who works on a cost share basis. We can tell you SoftwareAdvocates® has never been in the cost share business and we do not see us ever doing so. Separation of pay and advice are critical to unbiased service in our opinion.
Here is a quick list of rights we believe you are entitled to when working with any software publisher.
· You have the right to engage a third party subject matter expert if you desire.
· Clear and concise responses to all of your contract and licensing questions.
· Understand how to measure and calculate software and subscription service license compliance.
· All promises are written and referenced in your executed agreements.
Microsoft Job posting from October 2015 (copyright the Microsoft Corporation)
Job # 931626
Locations United States, Other ﴾United States﴿
Job families Sales
Sr Licensing Sales Spec EPG
While the standard Microsoft Job Title is Sr. LSS this role is more aimed at enabling strategic negotiations than licensing ‐ though a solid understanding of how we monetize our IP though licensing is required. This Strategic Negotiation Consultant is a strategic Sales role for the US and serves as a critical enabler to building solid negotiation foundations, mitigating the impact of Third Party Negotiators and scaling these practices through the US and world.
This Black Belt Negotiation Subject Matter Expert will be focused on the following:
Engaging with and mitigating the impact of Third Party Negotiators
Tracking new trends in negotiations with Microsoft and developing responses
Engaging with and assisting account teams on some of our most challenging negotiations
Consulting with the broader field sellers on negotiation tactics and developing solid a negotiation foundation
Driving our negotiation “Discounting Principles”
Serving as a corporate escalation point for field sellers
Providing valuable insights back to leadership
The Strategic Negotiation Consultant will provide thought leadership and readiness to all of our selling communities ‐ driving and supporting knowledge transfer of essential negotiation skills between team members and the broader sales force. They will also act as mentor leveraging, among other means, regional summits, monthly ATU, STU and LSS calls, and customer planning sessions.
Primary Job Functions
Contribute to the overall account plan by developing appropriate negotiation strategies to grow revenue, drive deal velocity and limit discounting.
Assist ATU, STU and Licensing teams in implementing a consistent process for building a strong negotiation foundation.
Jointly with ATU, STU, Licensing Teams, negotiate with customers to maximize contract value and Customer Satisfaction
When appropriate, lead the customer negotiations and own all the negotiation phases on behalf of Microsoft
Understand and apply the Field Empowerment Guidelines and “Right Price Right Customer” principles + tools to close “good business” efficiently and with maximum profitability. Consult with the Business Desk to create appropriate exceptional solutions for exceptions beyond Field Empowerment.
Ensure proliferation of negotiation best practices through the US and World Wide.
Deal velocity ﴾OTRRR﴿
Third Party Impact reduction
Min 5 years of front line negotiation experience
3‐5 Years of related Licensing Sales experience
Bachelor’s Degree Required, MBA Preferred
Experience coaching sellers through the negotiation process
Experience in business management and program management/execution