Novell Overhauls Its Channel Management, Programs

Novell is extensively overhauling its channel organization, including making changes among its channel management ranks, in a bid to increase sales through resellers and cut the company's sales costs. While details remain scarce, the changes include reducing the number of accounts Novell will service through its direct sales force and increasing funding for partner programs.

No longer with Novell are Steve Erdman, vice president and general manager of channels and alliances, and James Simzer, a long-time Novell manager who most recently served as director of North American partner sales. Both left the company Nov. 2, but a Novell spokesman wouldn't comment on the circumstances behind their departures.

The changes apparently began Oct. 24 when Novell appointed Tim Wolfe as president of Novell Americas. Wolfe was previously vice president and general manager of Novell's East region in the U.S. Wednesday, a Novell spokesman also confirmed the hiring of Pat Bernard, a former Hyperion manager, to the newly created post of vice president of global channel sales.

In a written statement Thursday a Novell spokesman said, "the changes in our channel team are in line with our efforts to get our entire sales force focused on a partner-led, go-to-market model." But the company has not otherwise made any announcements about the new strategy.

Novell will be cutting back on its direct sales force and reducing the number of direct sales accounts in North America from 1,700 to just over 400, according to one channel source. Another major change: "Partner sales executives" who were combined direct sales representatives and partner development managers will now be "partner executives" who work solely with channel partners.

Michael Zepernick, president and CEO of Computer Integratd Services Co. of New York, also sits on the channel advisory board. Novell's goal is to increase channel sales from 40 percent in the just-completed fiscal year to 60 percent this year, he said. "It's a significant figure we're talking about here." He said there also will be incentives for partners to bring in new business and Novell will leave more service opportunities to the channel.

Novell's need to reduce sales costs and increase gross margins is apparently the major drivers behind the changes. "They're really looking at making this a more competitive company," said Sam Sandusky, president of Big Sur Technologies, a Tampa-based Novell channel partner. Sandusky sits on Novell's channel advisory board and board members attended a series of briefings earlier this week in Atlanta on Novell's channel plans.

Sandusky acknowledged that the departures of Erdman and Simzer were a "shock," but he called Wolfe "smart" saying: "He's got the right things on his mind." While he thinks Novell is heading in the right direction with its new strategy, he added: "They are very much an evolving company."

Zepernick is upbeat on the changes. "They're changing their channel program pretty significantly and I think it's going to be a good thing for channel partners. It's going to be a partner-led business," he said.

Other Novell channel partners contacted by CRN were unaware of the changes and had yet to be contacted by the company. Next week Novell is holding its annual sales kickoff event, which brings together the vendor's sales representatives and select top partners, and the new channel strategy will undoubtedly be a topic of discussion there.