Value Trumps Loyalty, IBM Chief Palmisano Says

What a difference a few years makes.

When IBM Chairman and CEO Sam Palmisano took the PartnerWorld stage in 2002, he played the loyalty card with Business Partners. Palmisano told PartnerWorld attendees then that he knew they had choices and some chose to divide their business between multiple vendors. But he added that IBM had the broadest portfolio and best technology and that it only made sense for partners to cast their lot with IBM.

Fast forward to PartnerWorld 2007. Logicalis, Hewlett-Packard's largest enterprise solution provider, won the IBM Business Partner Excellence Award for the Americas on the strength of taking its IBM business from zero in 2004 to $200 million in 2006. In the past, the award has routinely gone to IBM-only partners such as last year's winner, Sirius Computer Solutions.

When asked about the changing face of IBM partners before his PartnerWorld keynote Tuesday in St. Louis, Palmisano told CRN, "First of all, you have to thank Logicalis for considering us and giving us a shot," he said. "Partners are attracted to where they can generate value, and they generated $200 million of value with IBM. That sort of says it all."

He added, "Multivendor is a reality of the world. Anybody who thinks we are going back to a proprietary set of architectures is living 20 years ago. We have to create value for our partners. Our partners have to create value in the marketplace. And when that comes together, it works."

Jeffrey Teeter, executive vice president and general manager of Logicalis' IBM group, noted, "IBM in the past has described the Excellence Award in terms of growth and customer satisfaction, and they used the word 'loyalty.' Loyalty is missing from this year's description of the Excellence Award."

Added Logicalis Chairman Mike Cox, "We have a significant multivendor lineup, and what IBM is saying is that you can be very successful and grow faster than the market and still offer other vendors' lines."

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