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

Gogh: We are constantly looking at the portfolio of partners that we have in the U.S. and around the world to ensure that we can lead in the SMB space.

We have now taken a product development offerings division and really focused them on the SMB space with specific offerings. That is why we have got to ensure that our partners are enabled and prepared adequately to win in the SMB space. And we will do some portfolio analysis to make sure that we have the right partners for that space.

CRN: Is part of this not just recruiting partners but re-engaging ones that you have lost contact with?

Gogh: We continue to rely on our distributor channel. The Avnets, the Arrows, the Tech Datas of the world to be sort of that face to the partner community. Number two as we continue to hone in on the business systems offerings that we are bringing to the market space we will continue to do a portfolio analysis. I do, however, feel that the portfolio of partners we have today allows us to have a very strong presence in the SMB.

CRN: Are there any new rules of engagement that prevent channel conflict vs. direct sales and the channel as you roll this out? Right now the deck is stacked in favor of those territory managers working with their buddies in the IBM sales force rather than the channel.

Samson: I would be surprised if that was true in the SMB market. I could see how sometimes that conflict occurs in the enterprise space, mostly because the enterprise space is controlled by client execs and a very deep sort of heritage calling on those larger clients. I am going to be honest with you. I have never seen evidence of that in the SMB space.

CRN: You have guys working with divisons of large companies, and as soon as a deal reaches a certain size, direct is all over it.

Samson: There is no incentive for the direct sales force to do the deal instead of a partner. There is no reason logically, financially or any other reason, why they would do that. There is no reason.

There is no reason why a direct rep would want to take it direct vs. a partner.

CRN: Then why not make a statement that this is the exclusive turf of the channel and that you have no direct sales reps, only channel support sales reps?

Samson: Well look you can get into all the legal reasons why you can or can't do that. That is not really the question. I think the question is our route to market in SMB is the channel. Period. End of discussion. That is the route to market. It is not a matter of saying it is the exclusive [domain of partners]. The purely pragmatic aspect of this is the only way you are going to get to these clients is with the channel and with our channel partners. I would be curious to hear of any instances where a partner has had a [channel conflict] deal with direct vs. partner in SMB. We just do not have enough resources to cover it. We don't have enough feet on the street. The direct team is focused on helping coordinate and working with the channel and they are incented to do so.

CRN: Is this going to unleash a calvacade of new SMB products from IBM?

Gogh: The answer to that question is yes. First of all you saw a significant announcement from us with Blade Center S last month, specifically building a blade center for the SMB marketplace. Back in April when we announced the System iSeries 515 model that was specifically targeted at the SMB marketplace and it has been extremely well received not only by the channel but by the end users. The third thing is as we bring this Business Systems division under Marc Dupaquier we are increasing our investment to build offerings specifically for the SMB marketplace.

CRN: Some partners see their IBM sales as a total percentage of their business shrinking since the sale of the IBM PC business to Lenovo two years ago. Do you agree that this comes at a time when you are losing channel share in SMB to HP?

Gogh: No. This strategy was built on the market opportunity of the SMB space that we have going forward. You saw SMB grew 10 percent in our [just released] quarterly earnings. We have channel partners who are factoring in when they make comments like that their PC business, they look at their printing systems business and then they factor in the server on top of that. We are looking at the market that we are playing in that customers are asking us to play in. This was truly driven by marketplace opportunity.

CRN: So this is not a response to HP channel gains?

Gogh: I know you'd love me to say yes. The answer is no. This is all about marketplace opportunity. If HP wants to continue to sell PCs and printers and ink then go for it.