Mike Grainger, Ingram Micro

CRN: What was your initial reaction to Dell's plan to sell white-box systems through the channel?

Grainger: My first reaction was a good reaction. I think it's an endorsement of the channel by them.

CRN: Do you think they're finally publicly recognizing the value of the channel?

Grainger: I think they've always seen the value of the channel and they used it as it fit their model. I think this is more evidence of how they view it.

CRN: What are solution providers,your customers,saying they need from the new Hewlett-Packard in terms of channel programs?

Grainger: The message is one that's been very consistent through the years. What the solution providers want are clear, concise rules from the manufacturer so they know they can develop customers without worrying that they'll shift to the direct manufacturers. They want to have access to the product and good terms and conditions that match those that they had. The point at this moment is that HP is trying to sort through some things, and until they do and come out with things laid out, things are going to be uneasy. HP has done a pretty good job of reaching out and asking for feedback and comments, and taking them.

CRN: Solution providers are complaining that HP's PartnerOne Program exposes systems, notebooks and Intel servers to direct sales. What can Ingram Micro do to discourage HP from that strategy?

Grainger: I think the answer is always going to come back to that the customer is going to make the purchase based on who's providing the answer to his problem, which is the solution provider's business. If HP can solve that problem by themselves, that's where the customer is going to go. But nine times out of 10, particularly in the small-business space, the VARs will have the answers to that.

CRN: Once HP hammers out the details of its supply chain initiative, what do you think will be the biggest changes in how Ingram Micro deals with HP?

Grainger: We don't know everything yet. Even as I sit here today, we don't know what the terms and conditions will be for the distribution channel. We don't know how, exactly, they're going to roll out programs to the customers or how they will be able to stress-test their fulfillment system in order to do the things they need to do.

I'll be surprised at the end of the day if the economics of the channel don't prevail over the economics of direct fulfillment. It has always been the case and will always be the case. You can't beat the scale that comes from the combination of a distributor and a solution provider.

CRN: What are the biggest changes you'd like HP to implement in its upcoming supply chain initiative?

Grainger: Every day they need to remind themselves that their success is based on making the channel and the VARs successful. After they start the new programs, they should be honest with themselves when they stress-test their direct fulfillment channel and [determine what they can and can't deliver. They ought to be staying up all night worrying about this. I just can't imagine that it's going to beat the economics of going through the traditional channel.