Fiorina: HP Needs Direct Engine And Partners To Be Successful

Noting that two-thirds of the company's sales come from the channel, Fiorina told analysts at an HP Industry Analyst conference here that HP "will aggressively utilize all go-to-market channels" including direct sales.

"You will hear a lot about our direct engine," Fiorina said. "You will hear that we continue to ramp that aggressively, and we are also spending a lot of time focused on our partners in these markets. Both motions are vital to our success. Maintaining both motions is important to the market reach and the market leadership we aspire to."

Fiorina's comments come just as HP is set to officially roll out on Nov. 1 its long-awaited PartnerOne channel program, which combines the HP and Compaq channel programs, under a single set of terms and conditions for partners.

Fiorina compared the direct vs. channel challenge to HP's aggressive Linux push while at the same time partnering closely with Microsoft on .Net and other initiatives. "The reality is we need to do both," said Fiorina. "The reality is our partners understand that we are going to have to serve customers where and when and how they want to be served."

In the enterprise segment of the market HP is "focused on very predictable and aggressive direct selling strategy with partner support where it makes sense," said Fiorina.

In the small and medium business market, she said, "our partner-led strategy is really focused on re-engineering the channel and the economics of the channel."

Fiorina stressed it is also important to recognize that "our channel strategy and the emphasis of our channel strategy differs somewhat by region depending on where a region is in its maturity and differs as well a bit by product line."

In Asia-Pacific, for example, she said, HP is rolling out what "used to be known as our Hard Deck program where we are getting very specific with partners about where we will go direct and where we will work with them."

Fiorina also noted that rival Dell Computer is "recognizing that they have to try and build partner strategies as well so you see them, I think, getting more aggressive about trying to do that."

On the services front, Fiorina said HP is aggressively partnering with companies such as Accenture, BearingPoint (formerly KPMG Consulting) and others.

"We have spent a lot of energy particularly over the last 12 months getting very clear with each of our partners around where do we play, where do they play, how do we put that value proposition together for customers and how should customers look to us to manage that entire engagement for them in a way that takes advantage of our partner's capabilities but doesn't confuse them because there are so many people in the environment."