HP Beefs Up PartnerOne Program

Three years after launching its PartnerOne program, Hewlett-Packard has made some changes that the company says should make life easier for solution providers, while giving distributors a greater role.

Coinciding with the start of its new fiscal year Nov. 1, the changes to PartnerOne take effect just after John Thompson celebrates his first anniversary as vice president and general manager of HP's Solution Provider Organization (SPO). Much has happened since he took the reigns last September, starting with a tumultuous few quarters and culminating in the ousting of chairman and CEO Carly Fiorina--not to mention the many months of uncertainty that followed.

With new president and CEO Mark Hurd now clearly in command, Thompson has his marching orders to reward those partners who sell the most HP products. The changes to PartnerOne are aimed at achieving those objectives, Thompson says.

Among the modifications to PartnerOne, HP is bringing its distributors--including Agilysys, Arrow Electronics, Avnet, Bell Micro, Ingram Micro, Synnex and Tech Data--into the mix. Specifically, the intent is to bring distributors into the process of generating demand and helping solution providers take advantage of all the PartnerOne tools and programs, Thompson says.

"This underscores HP commitment to all aspects of the partner, including distribution," he says. "The fact that we are joining forces in a more formal way with our distributor partners to drive the benefits of PartnerOne out into the marketplace into the channel is an illustration of the importance we place on our distributor partnerships."

John Paget, president and COO of Synnex, views the move as an effort by HP to rely on distributors for more than just product fulfillment.

"It builds a closer relationship between the distributor and the reseller," says Paget, noting that HP accounts for 20 percent of its overall business. "This builds a cooperative kind of joint effort from a marketing standpoint, and it builds an interdependency between the reseller and the distributor."

Among other changes to PartnerOne, HP is realigning its storage product lines so they are designated as either commercial products or enterprise. For enterprise partners, that means those who sell commercial products will be compensated the same way volume partners are. HP downplayed that that could cut margins on certain lower-end storage products, saying it will step up its effort to reward commercial partners who add more emphasis to selling storage products.

"We are not saving money or dropping this to the bottom line. We are looking to invest more," says Tom LaRocca, vice president of HP's Americas Partner Development and Programs.

Rather than give margins at the rate of higher-end enterprise systems, HP will invest those funds to train and provide market development funds to commercial or enterprise partners committed to selling larger volumes, LaRocca says.

"We want to elevate the sales and increase revenue," he says. Because the amount of such systems that enterprise partners typically sell is insignificant, he doesn't anticipate backlash.

Another change to PartnerOne that is unlikely to result in any backlash is the elimination of a requirement that Gold- and Platinum-level partners are responsible to conduct satisfaction surveys of their customers every quarter or jeopardize their partner status.

"It just made sense that we took it internally and stopped burdening partners with this survey," LaRocca says.

Richard Chan, president of KIS Computer Center , Santa Fe Springs, Calif., welcomed the lifting of that requirement. Many of his customers are schools and don't appreciate being surveyed every quarter for 25 minutes at a time.

"We had to beg them to participate," Chan says. "It was a real hassle."

HP also is promising to maintain the integrity of PartnerOne by promising annual audits and is providing a more streamlined deal registration with an improved PartnerOne portal, LaRocca says.

Finally, HP has brought back Dan Vertrees to bridge HP's top enterprise solution providers with the company's large-account sales team. By tapping Vertrees, the company is returning a familiar face to work with HP's enterprise solution providers. Vertrees served as vice president of the company's Enterprise Partners Group until nearly two years ago when the company built a common solution provider organization for both enterprise and commercial partners. Vertrees has more recently handled alliances for HP.

"They put it together, and now they are tearing it apart again, which makes a lot of sense," says Rich Baldwin, CEO of San Diego-based Nth Generation Computing, an HP enterprise server and storage partner. Vertrees' role this time will be different in that he will report into the sales side of HP's Technology Solutions Group.

Vertrees sees this move as an opportunity to build stronger go-to-market efforts between some of HP's largest enterprise partners and the company's field sales reps.

"The business results will speak for themselves," Vertrees says. "We see this as a journey for success."