ARC: A Tool For Change

Here's an interesting statistic: 63 percent of the technology categories measured in the 2006 VARBusiness Annual Report Card (ARC) are performing at or above the overall study average.

Sounds good, right? Wait. Three categories performed below average in every criterion, and 46 percent of the study's assessment areas were below average. When you look at the ARC from a category-performance perspective, the vendor community still has a lot of room for improvement.

In this issue, VARBusiness dissects the ARC results, highlighting the best partner-satisfaction scores in Product Innovation, Support, Partnership and Loyalty.

Of the 19 technology categories, only three--Client & Server Processors, Network Color Printers and Midrange Servers--had scores in the assessment areas that were the same or higher than the overall category averages. Vendors in only two categories--Network Color Printers and Client & Server Processors--have consistently performed above average in every area in 2005 and 2006.

The six categories with the weakest scores were Data & Information Management Software, Business Software, Security Software, Network Storage, Storage Management Software and Advanced Desktops & Workstations. While Infrastructure & Integration Software ended with an above-average overall score, only Loyalty--which carries a heavier weight--compensated for below-average scores in the other three areas.

This is not to say that a majority of the vendors are failing to make the partner-satisfaction grade.

Only in Mobile Computers, dominated by Hewlett-Packard and IBM, did vendors show significant year-over-year improvement. While the average Loyalty score was still below the overall average, the other three averages were good.

Many vendors earned fantastic ARC scores from their partners. Intel had the best scores for Product Innovation and Support. Ricoh, an ARC newcomer that captured the top spot in the Network Color Printers category, had the best Partnership score. And security juggernaut SonicWall earned the best grades for Loyalty. On the whole, though, the ARC belonged to SonicWall and Intel, which tied for the best overall score.

Cisco Systems, which won in four categories, can boast the best score for technical innovation, partner portal, services engagement opportunity, solution provider program, managing channel conflict and likelihood to recommend to a customer. Intel won in the most areas, posting the best score in product quality/reliability, compatibility & ease of integration, postsales support, quality of technical support and marketing support. Ricoh, too, earned some superior scores--in presales support, marketing support, communications, managing channel conflict and revenue/profit potential.

These vendors are trailblazers for channel-partner enablement and success. When you open the ARC scorecard (turn to page 65), you'll see exactly how each vendor is performing in key areas. This is a tool you can use to access potential vendor partners and encourage current partners to improve.

Be assured that the participating vendors will scrutinize the ARC results for strengths and weaknesses in channel programs. In VARBusiness meetings with vendors, channel chiefs and their executives are asking about the meaning behind the numbers and where they need to improve.

Take SonicWall CEO Matt Medeiros, who has challenged his leadership team to improve on its already exceptional performance. Frank Vitagliano, vice president of worldwide channels and U.S. enterprise operations at Juniper Networks, is using the ARC results to set performance goals and expectations for his team. And Gary Gillam, vice president of channel operations at Xerox, is planning to make adjustments as he angles to regain Xerox's top spot in the Network Color Printers category.

What's not always clear is how the ARC influences vendors that aren't participating or how it affects those that don't qualify for the study. Many smaller and emerging channel-centric vendors will use the ARC results to build and improve their partnering efforts.

If I were a VAR, I would visit my vendors, ARC scorecard in hand, and ask what's in store for the coming year. The ARC is more than just a ranking of partner programs; it's a tool for communication and change.

Lawrence M. Walsh is the editor of VARBusiness and GovernmentVAR magazines.

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