IBM Steps Up Business Partner Recruitment

"There's a limit to the number of dealers and distributors we want to add," said Bill Zeitler, senior vice president and group executive, IBM Systems Group. "But there are no limits to the number of ISVs and integrators."

Zeitler made his comments Monday during a question-and-answer session hosted by Mike Borman, IBM's general manager, Global Business partners, at IBM's PartnerWorld 2004 in Las Vegas.

"What we want are partners that are constantly improving their skills," Zeitler said. "We don't have a limit as long as they add the right values."

He added that IBM has a history in luring partners away from competing vendors. "We've been successful in recruiting partners who were loyal for years to our competitors because they've had real questions about the strategy [of the competitor]," Zeitler said. (For more on IBM's ISV effort see CRN.)

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Steve Mills, senior vice president and group executive of the IBM Software Group, said that IBM had signed up about 1,000 Business Partners to its Value Advantage Plus Program, launched last year, and hopes to add a few hundred more in 2004.

Mills said the impetus to recruit new valued-added software partners is because the opportunity for both IBM and its partners is so huge, especially in the SMB space. "We sold software to 8,000 companies who had never purchased IBM software before in 2003, and we hope to sell software to 10,000 new customers in 2004," he said.

The vigor to recruit new partners comes as IBM appeared to be slowing down its drive to recruit integrators from competing vendors, notably Hewlett-Packard. Over the past two years, IBM targeted for recruitment HP enterprise VARs and snared about 200. IBM Chairman and CEO Sam Palmisano said in an interview earlier this month that the vendor may be slowing down its recruitment efforts so that it could assimilate the new integrators.

Now, however, IBM appears to be shifting its integrator recruitment strategy from large organizations to smaller regional ones.

One HP-only solution provider who has about $30 million in annual sales and who attended the PartnerWorld show said, "IBM is all over us and we are talking with them this week to see what we can do."

The solution provider, who asked not to be identified, said he would like to add IBM as a vendor partner in an effort to capture incremental revenue.

Eric Williams, executive vice president of Support Net, the IBM division of Arrow Electronics in Indianapolis, said, "It's a natural progression for IBM to go from recruiting large national integrators to small regional ones."

He said that the new VARs Support Net recruited as part of IBM's earlier competitive recruitment drive generated $25 million in new IBM business for the distributor last year.