Sun Reorganizes Channel In Face Of Layoffs, Possible Acquisition By IBM5:57 PM EST Thu. Apr. 02, 2009
Sun Microsystems is going ahead with a reorganization of its channels despite the prospect of the company being acquired by IBM in the near future.
Sun on Thursday said that is putting a stronger emphasis on its indirect sales channel, making it the company's primary go-to-market focus.
The reorganization comes during a time of turmoil for Sun.
The company is in the midst of laying off between 5,000 and 6,000 employees, and in the past few days has handed pink slips to about 1,500 personnel.
The move also comes at a time when IBM is reportedly offering to acquire Sun.
Solution providers who have received word about the channel reorganization appreciate how much Sun is investing in improving its channel.
However, many of them wonder whether it could be a moot point if the IBM acquisition of Sun actually happens.
After receiving notification about the changes, one Sun solution provider's first thought was what would happen if the acquisition goes through.
"After I saw it, I thought, OK, but are you guys gonna be bought," the solution provider said. "I can't help but think, what happens if Sun gets bought. It would be better if it did this reorg last year."
Rob Wolfe, president and CEO of AvcomEast, a Vienna, Va.-based solution provider and Sun partner, said there is some market stagnation going on thanks to the possible acquisition.
"We hope this gets settled swiftly," Wolfe said. "Sun and IBM can both help our mutual interests by acting on this."
Peter Ryan, Sun's executive vice president of global sales and services, said the goal of the reorganization is to provide channel partners improved access to Sun's software, server, storage and services expertise and to make it clear that Sun depends on its channel.
"We want to be completely unambiguous in our go-to-market strategy with our partners," Ryan said. "We are putting more resources into our partners."
A major change in the program is a new professional services engagement model for partners, Ryan said.
"VARs are more and more involved with virtualization, data center setup and other complex projects, and they want to do more services in these areas," he said. "So we've put in place a structured approach where they can lead and Sun subcontracts to them, or Sun can lead and they subcontract to us, or we work jointly. Partners need to know that, if they bring in a services lead, they will be protected."
Assurances to channel partners that they will be protected in a professional services engagement is something they seldom receive from vendors, Ryan said.
"We want to bring in transparency," he said. "It's based on good relationships and on trust. We've evolved the opportunity registration program we use for our product sales to work with services. So we have a consistent, contractual relationship."
As part of the reorganization, and in the wake of recent layoffs, Sun has put in place a completely new inside sales organization responsible for opportunity development to increase prequalified demand for sales, wrote Kim Jones, the company's new vice president of partner sales in North America, in a letter to partners.
Sun has also introduced a new global lead-management system to distribute qualified leads directly to partners and enhanced partner training. The company has also invested in ongoing programs, such as the Sun Partner Advantage Program Specialties program, providing partners with expertise and access to intellectual capital and the Partner Growth Fund to stimulate growth for Sun's highly aligned partners, and has provided access to Sun Rapid Solution blueprints, Jones wrote.
Jones now reports to Randy Seidl, Sun's new senior vice president of North American sales, who, in turn, reports to Ryan.
Mark Teter, CTO of Advanced Systems Group, a Denver-based solution provider and Sun partner, said he is excited to see Sun expand its channel support to make it easier for partners to work with the company.
"Sun has one of the better channel programs in the industry," Teter said. "It has a streamlined channel model, and a good deal-registration program. Every vendor has some issue with the channel. But we realize that, even with the bumps, Sun has always been focused on the channel.
Wolfe said that what he likes best about the reorganization is the fact that it means Sun is completely channel-leveraged in the wake of its layoffs.
"There's only one sales face in this territory, and it's the channel," Wolfe said. "If you are an outside-focused VAR who is proactively out with customers pursuing deals, you will do well. But if you are an inside-focused VAR, you will be going away. So the sales face of Sun is the channel. This is a great opportunity for partners to grow their business."
Ryan said that, in addition to a tighter channel focus at Sun, the layoffs also present another opportunity to partners.
"Some of our partners are asking about hiring our people," he said. "We encourage them to take advantage of that expertise."