Don't Be An Ostrich


The difference between a successful channel program and a troubled one comes down to strong leadership from the CEO and channel chief working in tandem.

If the CEO and channel chief are not ready and willing to exercise their muscle and clout to capture the solutions benefits that come from the channel, then more than likely they are going to find themselves running into a brick wall.


STEVEN BURKE Can be recahed at (781) 839-1221 or via e-mail at sburke@cmp.com.

The support from the CEO's office is even more important in difficult economic times such as these. Tight IT budgets always result in irrational behavior by internal sales and consulting forces. That irrational behavior is at a fever pitch right now, with many internal sales and consulting forces scrambling to protect their jobs. Instead of partnering to win new accounts, they are bidding head-to-head in accounts that their solution provider partners have been servicing successfully for many years. The result is declining profit margins and a demoralized channel that absolutely will switch clients to competing products.

Bottom line: The damage being done right now to longtime partnerships between vendors and solution providers is unprecedented. The companies that are winning in the channel today have CEOs and channel chiefs who are hands-on. They are completely engaged, interacting with solution providers on a daily basis.

One company that is getting it right is Computer Associates International. As CRN Associate Editor Jennifer Hagendorf Follett points out in one of our news stories this week (see page 6), the number of solution providers satisfied with CA soared from 29 percent in July 2001 to 41 percent in December, according to the CRN Channel Satisfaction Survey. CA CEO Sanjay Kumar and his channel lieutenants have transformed a mainframe direct-sales-oriented company into one in which channel commitment is deeply ingrained in every nook and crevice of the CA culture, particularly in the direct-sales and consulting arms.

The CEOs and channel chiefs who are taking the ostrich approach and simply sticking their heads in the sand in the face of channel conflict are going to find themselves looking at declining sales, and at sales, general and administrative costs that are out of line with the competition. That is a recipe for a change in leadership.

Which companies have strong channel leadership? Contact me at (781) 839-1221 or at sburke@cmp.com.