Thumbs Up For IBM, Cisco, Sony

IBM stands alone as the best of the lot in the CRN 2005 Channel Champions competition. No one else even comes close. The computer giant walked away with the highly coveted Best Channel Program special Award along with a record-breaking 11 titles in individual product categories in the 15th annual Channel Champions competition.

The other special award winners were Cisco Systems, which won the Best Technical Satisfaction Special Award along with four individual category awards, and Sony, which won the Rookie of the Year honor.

The stunning IBM performance featured wins in all four storage categories, all four system hardware categories and three software categories.

But the most prestigious honor was the Best Channel Program Special Award, given to the vendor with the highest average channel rating across all the categories. In order to be eligible, a vendor must have the highest channel rating in at least three individual product categories.

“IBM is at the top of its game,” said John Marks, an IBM solution provider based in Rosemont, Ill. “IBM has one channel voice and one channel strategy. They respect the relationship between resellers and end users and are doing everything they can to partner with the channel.”

IBM scored particularly high marks in the area of reducing/eliminating channel conflict, winning praise from partners for its robust deal registration initiatives and for the consistency of its channel programs.

Towney Kennard, IBM’s vice president of Business Partners, said the key to IBM’s success in the channel has been the computer giant’s support for the channel across every IBM business unit. Even IBM’s Global Services and Business Consulting Services units embarked on a major initiative earlier this year to work with Business Partners to capture midmarket accounts.

“The entire company is committed to growing our business with our partners,” Kennard said. “There is not a piece of our business that is not acutely aware of our partners, their business model, and how we can make our products more channel-ready.”

IBM’s executives say the partner commitment starts at the top with IBM Chairman and CEO Sam Palmisano. Kennard said one of the hallmarks of IBM’s razor-sharp partner effort is consistency. “The No. 1 thing partners tell me is stay consistent,” he said.

Unlike a number of vendors whose channel efforts seem to go in and out of fashion, IBM has had a steadfast focus on the channel, which has led to a partnering effort that is hard to match in terms of channel numbers. IBM partners accounted for one-third of IBM’s $96.5 billion in sales in 2004. And IBM says it has 6,400 employees in channel-related functions and a channel program budget of $2.5 billion.

Next to IBM, the most impressive numbers in the 2005 competition came from Cisco. The networking market leader, which has moved aggressively over the last several years to a highly specialized solutions focus, earned individual titles in the categories of VoIP hardware, wireless LAN hardware, switches and routers, and network security products.

Cisco’s high product ratings from partners secured the company the Best Technical Satisfaction Special Award, given to the vendor with the highest technical ratings across all the categories. Only vendors with the highest technical scores in at least three individual product categories were eligible.

John Freres, president of Meridian IT Solutions, a Schaumburg, Ill.-based Cisco Gold partner, said his clients are willing to pay a premium for Cisco technology because of their faith in Cisco’s product quality. He also said Cisco has a broad portfolio that is unmatched and far outshines the competition in areas such as VoIP and routing/switching.

“The reason Cisco commands a premium is peace of mind for that end user and also investment protection,” Freres said. “As the technology evolves, Cisco is offering a long-term strategy, not a point solution.”

Chuck Robbins, vice president of U.S. channels at Cisco, says the Best Technical Satisfaction Special Award reflects Cisco’s $3 billion-plus annual research and development budget. That investment has led to a product blitz that spans the market from small business to the enterprise.

“The new technologies are incredibly important,” Robbins said. “As we continue to grow, we will expand our presence into other technology areas. Customers want complete solutions.”

One example of Cisco’s technological prowess was its launch last September of its Integrated Services Router (ISR) family, which represented a dramatic step up from its traditional access router to a family of products integrated with wireless, security and VoIP. Six months later, that ISR product line was on a $1 billion run rate. “That was a really critical transition for us,” Robbins said. “That is a multibillion-dollar product line.”

One company that is definitely listening closely to its partners is Sony, which tied with Hewlett-Packard for the Channel Champ award in the LCD projector category. That win opened the door for Sony to receive the Rookie of the Year honor, given to the first-time winner of a category with the highest overall score.

Sony partners say the $72 billion conglomerate, which posted U.S. sales of $20.4 billion for the fiscal year ended March 31, has made great strides with its channel effort.

“They have really stepped up for the channel in the last two years,” said George Pashardis, vice president of sales for the New York metropolitan region for Eplus Technology, a Sony partner in Herndon, Va. “They have a broad product line from biometrics to storage to LCD projectors and notebooks, with great pricing, spif programs and reseller initiatives.”

Sony partners credit the hard work of Sony General Manager of Channel Development Joe Natale in large part for Sony’s channel upswing. “You have to be persistent and consistent,” Natale said. “We have gone out and engaged with the best of the best and had a groundswell of channel activity.”

Sony is now looking to get its top-tier partners to sell multiple products across its broad line. “We want to take programs that are successful and have earned recognition and support from solution providers and expand them into other categories,” Natale said. “My value proposition is a deep product lineup in the core categories of display, notebooks and storage.”

Sony is hoping its channel efforts will result in more Channel Champion category titles next year. Ultimately, though, the big question looming over the competition is whether IBM—which broke its own record for Channel Champion wins this year—will be able to continue its channel dominance.

Kennard, for his part, promises that IBM will carry on its tradition of listening to partners and improving its channel lot. “We are going to focus on how we can stay strong in the areas we scored well in, but more importantly, improve in the areas we need to,” he said. “That is what the market will judge us on.”