HP Provides Sales Punch For VARs Grappling With Downturn

Frank Rauch, vice president of HP's Solutions Partners Organization, said the two-day sales training, which can be funded with partner MDFs (Market Development Funds), is aimed at helping partners increase their win rates in a market where transactional IT product sales have fallen off and cost optimization projects are accelerating.

"We want to get a healthier channel," Rauch said. "We want to get a more competent channel. The training is a series of questioning techniques that allows them to get into a new account and drive toward these important (cost optimization) projects, and then be able to justify those projects. It's perfect for today's environment."

"What we are seeing is the transactional business or the run-rate business really fall off," Rauch said. "There is no question about that. People that used to buy a few servers a month, whether they needed them or not, as part of a regular routine are taking a second look at that. What we are seeing clearly accelerate is (sales for) partners focused on cost optimization projects. We are also seeing that the buying cycles are becoming a little bit longer because the customer governance processes are becoming a little tighter. What used to be a CIO decision or an IT director decision now goes to the CFO or the board. So what we are trying to do is equip our partners with training."

Rauch said the "proven" HP direct sales methodology provides partners with the firepower to "boil through" longer sales cycles and countless distractions from the economic downturn, Rauch said. He sees it as a critical differentiator for HP, particularly in the current IT spending climate.

"Appointments are getting harder to get. Projects are getting harder to justify," Rauch said. "There are a million distractions not only in the partner organizations but in the manufacturer organizations and in the customer organizations. The ability to have that laser focus and a methodology to boil through that is going to be key." Rauch talked about the new sales training in an interview after a keynote address he gave at solution provider NWN's national sales conference in Myrtle Beach, S.C.

Mont Phelps, CEO of NWN, No. 207 on the VARBusiness 500 list and winner of the top CRN Fast Growth award for the last two years, said the HP sales training gets the NWN sales team talking the same language as the HP reps.

"If you don't have the same language, you have no chance of communicating and the problem is you don't even know it," Phelps said. "So there is no communication going on. Every company has their own language. You gain enormous efficiencies by being able to communicate with the same language."

Rauch said the current economic downturn is sure to result in partner consolidation. "Water is going to find its own level," he said. "What I mean by that is the good are going to get better and probably some of the weaker partners are not going to survive the environment."

The difference between success and failure for partners, said Rauch, may well be business model "transparency."

"We are implementing partner growth plans for every elite partner right now," Rauch said. "To me, it really is transparency of the business model. That level of transparency allows us to deal with potential problems and be able to provide some level of remedy where we can."

That said, Rauch stressed that HP will not be able to help all partners. "My approach is not a peanut butter approach," he said. "My approach will be to work with partners that are dedicated to acquiring new HP customers selling the HP portfolio and providing a reasonable ROI (return on investment) on the money that we give them."

The stepped-up commercial partner training comes as HP is getting a lot of entreaties from other vendors' partners looking for shelter from the downturn, Rauch said. "We have a lot of competitive partners knocking on our door right now," he said. "And we are not opening that door to everyone."