Times are changing for Panasonic and its channel partners.
The company is in the midst of a major overhaul of both its corporate structure and its channel strategy in North America. Last year, the company integrated many of its B2B products, from its Toughbook ruggedized laptops to its telephony and audio/video products, under one roof with the Panasonic System Communications Company of North America (PSCNA). The company also introduced the Panasonic Authorized Reseller Program for all the combined product lines.
This year, PSCNA has focused on getting partners to cross over into new product categories and focus on IT convergence, but the company is still working out the wrinkles for its partner program and channel strategy. In addition, Panasonic last month saw the departure of longtime channel chief Sheila O'Neil, with Bill Brennan, vice president of channel sales, assuming her duties.
CRN recently spoke with Rance Poehler, president of Panasonic Systems Communication Company of North America, to see how the company and its partners are adjusting to the numerous changes. Poehler talked about Panasonic's vision of IT convergence, its evolving partner program, and how the company is looking to build loyalty with core channel partners. Here are excerpts from the conversation with Poehler.
You've made a lot of changes to your go-to-market strategy in the last 12-18 months. Where does Panasonic's channel strategy currently stand?
In the last couple of years, we've pulled together all of the B2B products here at Panasonic into a single company. So we had the mobility side with Toughbooks, we had a security category, an audio/video category, an office products category, and a telephony category. So there's a lot of great technology rolled into a single company. And we're a vertical solutions company; we're not a box company, and we're not a consumer company. We're focused on the enterprise and the government. As you can imagine, when you're pulling together a bunch of different organizations, the channel strategies for each organization and category is a little different. So we put all of those organizations in the same channel strategy as the Toughbook; Panasonic's Toughbook business has been very loyal to the channel for about 20 years now, but some of the organizations were selling direct. So we moved everything into a consistent two-tier model. So right now, 99 percent of our business is in that two-tier channel model, and it's really built on the loyalty we've built with partners.
How many partners in total were brought together?
When we brought all of those companies together, we ended up with 14,000 resellers. What we want now is to focus on a core group of those VARs and integrators that really want to work with us to deliver our solutions to customers. And we're getting extremely positive input from partners because now there is a single set of terms and conditions and a single fulfillment strategy. We look like a single organization to our channel partners, and we're building on that approach. And obviously it's been frustrating for channel partners because we've undergone a lot of change, especially in the last 18 months. But I think now partners get it, and they support it. They're excited because we have a vertical solutions approach and we can help them grow their business by generating more revenue and higher profitability. Yes, we've made some mistakes in this process, but I believe our channel is appreciative of this approach and where we're headed. So we'll continue to add more resources and programs for our loyal resellers.
Are the core partners you spoke of engaged in multiple solutions categories? Is that a prerequisite for being considered a core partner?
We still have a lot of partners that don't cross categories. So for example, we have great Tougbook resellers that have been selling that category for years, and they may not do any security or telephony or anything else. So those core partners may be focused only on mobility, and that's fine. On the other hand, we have partners that recognize the strategy and understand they can grow their business in this convergence of IT that's happening in the market between mobility, security, telephony and all these different areas. We have all the technology in one company to supply partners for that convergence. So some of our partners want to be part of that; for example, maybe a security integrator sees an opportunity to provide a customer with A/V solutions on their network or provide telephony support or mobile devices, too.
NEXT: Building Loyalty With Core Partners
How are you encouraging partners to explore some of the other product categories that they may not have been exposed to previously?
You have to have the right programs and the right incentives for partners. And you clearly need education and training and sales tools to get it done. And we have a lot of work to do there. But the companies that get it are being proactive. They're building an ecosystem, and they're aligning their resources with our resources and our channel field team. In terms of partners that want to put skin in the game and work with us, we're making nice progress.
What are the biggest challenges then for your integrated channel strategy?
We've been fortunate to have a lot of good, loyal long-term partners. So I think the obstacles for us are just around speed and executive. We've got great partners, and we've got to bring the right programs and right solutions to bear. Now that we have all this great technology in one company, we have to generate vertical solutions. And partners are looking for Panasonic to package these vertical solutions. So in education, for example, we're working on connected classrooms and campuses and we can give those solutions to the partners that are focused on education. Retail is another industry; we have all the technology to run a restaurant, and once we package that vertical solution -- and we've already done it on the QSR side -- we hand that blueprint to the channel to go to market. I think our strategy is pretty unique. I don't think there is a single company that can do what we're trying to do right now.
Are you recruiting new partners that are specialized in a particular area like telephony or A/V? Or are you focused on getting existing partners to explore other product categories?
Basically, we're focused on doing more with less by taking that core group of partners, whether it's 500 or 1,000 resellers, and really drive the business. Are we going to add more partners? Sure. But we're really looking to focus on that core group that understands the convergence strategy and wants to get behind it. We have no intentions on focusing on programs to add more resellers beyond that.
You introduced the Panasonic Authorized Reseller Program about a year ago. Where does the program stand right now, and are you looking at making any big enhancements or changes to it in the future?
We're going to evolve it constantly. We're making incremental changes. Last week, we sat down with some of our core partners on the West Coast in an advisory council meeting. So we asked them about what we're getting right, what we're getting wrong, and what they'd like to see in the future. Based on that meeting last week, we've already made significant changes. And we'll continue to have those advisory council sessions and evolve the program. None of us were happy with what we did a year ago [with the authorized reseller program]. The market moves fast, and we have to continue to evolve.
What were the changes that you made based on the advisory council feedback?
Those partners have given us some great direction. We're going to evolve this program to something that's more of a Panasonic loyalty program. It's not going to be for every company. It really applies to our most loyal partners. And we'll add more and more to that program as we get more input.
I think if you just ask the partners what they want and listen closely, they'll tell you. We consider ourselves a channel-friendly company. We've been in the channel for 20 years, and we believe in the channel. Maybe we don't do the best job all the time, but we listen. And we know we have to keep improving and involving. Partners want the solutions, they want the ability to cross product categories easily, and they want the training and tools to help them go to market. So we'll continue to do that.
PUBLISHED NOV. 18, 2013