At Dell, Actions Speak Louder Than Words

So is Dell interested in building a meaningful indirect channel or not? Despite Michael Dell's recent statement that the company is doing just that, I think it is far too early to believe him. The fact is, the hurdles may be higher than the company is willing to scale to make it happen.

Let me list just a few of the issues working against Dell. Right now, there is little to no channel expertise inside the company. The company remains structured and focused to capture direct sales. Its internal compensation system needs to be revamped. There is no channel advocate inside the company. It faces unprecedented channel conflict issues between its direct and indirect business. Those are just some of the major hurdles, and we can't truly judge the company yet as to whether it is going to tackle them.

ROBERT FALETRA Can be reached at (781) 839-1202 or via e-mail at rfaletra@cmp.com.

But we can look and judge it by the actions it takes in the market.

Now although I don't expect Dell will ever stop driving its direct business, one would think that if it was ready to announce it is moving into the indirect channel then it would be ready to make a move or two in that direction. But we haven't seen a thing yet.

What we have seen is some announced acquisitions.

Dell announced the acquisition of ASAP Software last week. Two weeks prior to that, it said it would buy managed services platform vendor SilverBack Technologies. If Dell is serious about the channel, then it should be sending a message via marketing and in other ways that its focus is to do just that. In both of these acquisitions, Dell had an opportunity to say it will leverage these buyouts in its efforts to build an indirect channel.

Did it not do that because it doesn't want to? Did it not do that because it just didn't think about it? Did it not do that because it has no intention of doing so? I don't know the answers, but I do know that so far its actions don't indicate any movement toward a real indirect effort.

One of the challenges that Dell faces in both the short and the long term is a strong skepticism as to whether it is really going to be a player in the channel. The company has to realize and deal with that via its marketing and PR, at the very least. Perhaps the company DNA just isn't wired to think indirect channel yet. But perhaps the company will never view indirect sales as a critical strategy.

You have to decide what you believe. As for me, I'm skeptical and until I see some marketing to the channel and some actions to engage, I'll keep the jury in the deliberations room.

Do you think Dell is serious about the indirect channel?
Make something happen. E-mail CMP Channel Group President Robert Faletra at rfaletra@cmp.com.