There has been a growing trend of vendors shifting their efforts and dollars to VARs that are exclusively investing in their product lines. Hoping to capitalize on the channel's uneasiness with this approach are two large vendors that are going back to basics: Dell and Symantec.
In an exclusive interview with Michael Dell, he explains that his company will place no restrictions or minimums on the types of products its partners sell. Meanwhile, Symantec is getting out of the services business and doing away with revenue requirements and replacing them with market segment specializations.
It will be interesting to see how these strategies play out in the channel and if Dell and Symantec can gain market share and channel mind share with the approach.
The exclusivity play that some other vendors are taking is a risky one for both customers and VARs. It goes back to the best-in-breed argument. Customers want the best technology. It is the VAR's job to integrate the technology in a seamless way.
It seems that time and time again vendors make mistakes when they create channel programs. And the pressures of a bad economy create bad behavior.
The first mistake is the vendor gets inwardly focused. Its programs are built with the vendor and partner relationship in mind. But the vendors need to understand that for most VARs, the key relationship is between the partner and the customer. They are the trusted adviser or the outsourced IT shop. Trying to force a one-vendor solution won't work in the market. The partner doesn't want it and the customer
doesn't want it.
Another mistake is conflicting compensation plans and compensating the direct-sales force with different metrics. A channel sale and a direct sale need to be compensated in the same way and they need to be consistent in every business.
Lastly, support from the channel has to come from the very top. Channel success equals CEO support. If you don't have support from upper management, it is much more difficult to get the constituencies in an organization to support the channel.
While CEO of HP, Mark Hurd was an excellent example of this support. He would meet with HP's VARs and its customers and the admiration
and loyalty that engendered were impressive. In fact, VARs are willing to consider partnerships with Oracle even though it has a reputation of having a large and aggressive sales team just because Hurd is there.
Michael Dell has made some significant inroads in working with the channel. He was once considered the enemy of the channel, positioning the VAR as an unnecessary middleman. But today Dell works with VARs and visits their customers to help close deals. This goes a long way when it comes to loyalty. What's more, Dell is easy to deal with. Again, back to simplicity and basics.
Symantec's Enrique Salem is similar in his approach. He is willing to spend the time with CRN as well as channel partners because he understands that the success of his company is on the back of his extended sales force -- the channel.
Vendors need to get back to basics and with channel support
they will win.