The Michael Dell Difference

Dell, an industry icon who pioneered the direct sales model for the PC business, has remade himself and his company over the last four years into a charged-up, channel-centric partner. In the process, Dell himself has become his company’s No. 1 channel advocate.

Fueled by rival Hewlett-Packard’s plan to spin off its $40 billion Personal Systems Group business, Dell is on an all-out channel tear. He has been tirelessly phoning one solution provider after another as part of a Dell channel recruitment blitz, seeking feedback on how he and his channel team can work with partners to win more business. If that isn’t enough, Dell is on a world tour of sorts, meeting personally with partners to win their business.

The net impact has yet to be felt from Dell’s channel intelligence effort. But it is coming and, make no mistake about it, will be felt. The kind of channel engagement that Dell is driving in the sales trenches always pays off. The fact is Dell and his company are making bigger investments in the channel with new, innovative channel sales initiatives being brought to partners. And Dell himself is leading the channel parade. That means a lot in the sales trenches where partners and their sales forces demand top executive engagement. Sales is a people business. Solution providers and their sales teams like to look their vendor partner CEOs in the eye and gauge their personal commitment to their business. And Dell is making them believers.

One CEO of a large national solution provider, who recently spent 30 minutes on the phone with Michael Dell, says he believes Dell’s firsthand efforts will result in bigger channel share for the company.

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“I believe they are going to take share,” says the solution provider CEO. “How big a share is what Michael is driving. He is getting more engaged with partners and is open to suggestions on how to capture more business.”

“Michael is out there personally helping us drive more business,” says the CEO. “You’ve got to respect that. He grew up in this business selling PCs like us. He relates to us more than other CEOs.”

Dell’s channel conversion didn’t happen overnight. Michael Dell and Greg Davis, the company’s global channel chief, have been building the channel effort one partner at a time, and Dell himself has played an active role in that channel sales effort, reaching out to partners directly and helping them close deals. The Dell channel business now amounts to about 33 percent of the company’s $62 billion in annual sales. And Dell sees it growing to 50 percent.

The fact is Dell has grown its channel business by being a consistent and predictable partner with a channel-neutral sales compensation model aimed at incenting its direct sales force to work hand in hand with partners. That’s not to say that there are still not issues with channel conflict. Many partners want to see more joint sales engagement between Dell direct and partners. And if Dell starts opening enterprise customer doors with data center solutions partners, it could prove to be a huge windfall for the company.

Partners that decide to take on Dell as a partner can be sure that they will find in Dell himself a passionate, channel-savvy leader that gets their business and the power of delivering solutions -- hardware, software and services -- to customers, and is willing to get his hands dirty helping them in the sales trenches. Michael Dell gets the channel. And he gets IT. That’s a lot more than can be said of many CEOs in this business.

BACKTALK: What’s your take on partnering with Dell? Contact Steve Burke at [email protected].