Q & A: IBM Execs Sound Off On SMB Sales Overhaul

CRN: In the U.S. will there be more channel facing people touching SMB partners? Right now a lot of these partners aren't getting touched at all in the wake of the sale of the IBM PC business to Lenovo two years ago.

Gogh: There will be a greater number of partners covered as a result of the economies that we are getting from this integration.

CRN: How many partner reps are there going to be knocking on SMB IBM partner doors in the U.S.?

Samson: As you know, we are going through the integration work now. The simple answer to the question is: We'll have more. The specific number I can't give you. I just don't have that number in front of me. But we will have more. And the reason is rather straightforward. If you look at it today we have got an STG coverage model and we had before an S&D [Sales and Distribution] coverage model for the channel. When we bring both of those together we will certainly have a larger aggregate number but we will also deploy that number more consistently over the channel partners that we have with a consistent set of programs that we do not have today. In that regard we are actually going to improve our coverage and we will cover more partners.

CRN: When will partners know the name of their new channel reps?

Samson: For a lot of partners the team members are not going to change on day one. It is not going to change at all. As we cover more partners they will learn their new person's name.

CRN: Haven't you had a territory manager there all along having a final say on partner and direct sales in each region?

Samson: Let's sort of take this from the ground up. We define the world by 220 SMB territories and in that territory is a territory manager who sells everything. He has responsibility for services, software, hardware and aligned with that territory manager in the past we had five different specialists. Let me give you an example in Hartford, Conn., we would have an iSeries rep, a pSeries rep, an xSeries rep, and a storage rep, all calling on clients with that territory manager. The territory manager has the whole IBM portfolio not just the STG hardware portion of it. So you had those five specialists coming in and out working with partners in that territory and those specialists reported to managers all over the place. The iSeries rep might report to someone in Boston. The pSeries rep might report to someone in New Jersey. The xSeries rep might report to someone in Rochester, New York. The problem you had was now I am an xSeries rep and I am going to go work with a partner in Hartford. My manager is in Rochester. He doesn't even know how to get to Hartford probably. And that manager has to go help work with the channel partners and work with the xSeries rep and he is not even there. In the new model, there is going to be a person in Hartford who is the SSM that has those specialists for those same brands working for him or her. Now if you are a partner and you want to go create the right coverage model and leverage the right kinds of relationships you can go to one place: the SSM. The SSM does not work for the territory manager. He works with the territory manager.

CRN: Will this also simplify pricing at IBM? Now will fewer people be comped on a single sale because you have a more streamlined organization?

Samson: We have a lot of issues to solve with regard to the number of people that get paid for an individual transaction. That has been one of my pet peeves, to be honest with you. I attack this from a different point of view. If you are a sales person and you are being comped for things for which you had no contribution on, it is not particularly, how do you say this, affirming as a salesperson. You get paid for something you never had anything to do with it. There is a sales sort of culture that is part of this that is wrong by paying people for things they never had anything to do with. And yet our model over time, because you had account people, client people, specialized people, you have people that are called overlays that might be part of this on a specialized product sale. They participate in sales at least with regard to being comped for them for which they had nothing to do. So the first sort of order of business that the SSM will have to go work is to destack some of this stuff. You have got to destack some of this. You have got to say a guy in New Jersey getting paid for a transaction in Hartford that he had nothing to do with does not make any sense. But the only way you can do that is in the individual territory or the individual cluster. It is very difficult to make a broad based program to say these people aren't going to get comped. It needs to be done from the ground up. That needs to be done by the SSM.

Now is that going to happen on day one? No. Is it the responsibility of the SSM to help us destack ourselves so we don't have 14 people getting paid for one transaction? Absolutely. It is also then the responsibility of the SSM to make sure we have got the right channel capacity, the right channel skills with the channel partners that are there that reflect that particular territory and the requirements of that particular territory. So a part of this is jointly working with partner teams to go do that.

CRN: Will there be particular products that benefit in the IBM product portfolio?

Samson: In a perfect world I'd like balance across all our product portfolio. That is the perfect world. But here is what happens. The SSM will essentially become a reflection of the territory that they have responsibility for. So you might have an SSM that has more System iSeries clients or an SSM that has more System pSeries clients.

The composite makeup of an SSM will be a direct reflection of the kind of clients they have in their territory. It won't necessarily buy us into one brand or another.

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