Streamlining Xerox's Channel

James Firestone, senior vice president of Xerox and the company's North America president, met with Editor in Chief Michael Vizard and Senior Editor Edward F. Moltzen about the Stamford, Conn.-based company's channel strategy. Here are excerpts:

CRN: What's driving the relationship in Xerox's channel between your company, your office-automation channel, your indirect resellers and your direct-sales force? And second, as the technology shifts and we see more printer-centric multifunction printing devices out there, how does that change the way Xerox goes to market?

FIRESTONE: What we said we need to do to go forward are three things. One is what we call the new business of printing. The whole printing industry because of digital printing capability is going to be totally changed. And we have great technology that's driving that. Second, with our large companies, is giving a broader proposition in terms of document management. So yes, the printers, yes, the copiers. But it's the combination of those two because they're all merging together. So it's more the value-added capabilities that leverage off of your print and output infrastructure. Software and services become more important. So that's the second theme. How did we position our relationship with our customers and their partners in a way that allows them to bring the most value to the table? And the third theme is how do we reach out to more customers? Because, historically, we've been constrained to a degree by our overemphasis on direct selling, limiting us to a certain amount of reach.

CRN: So the old structure was based on product, and the new structure is based on customer sets?

FIRESTONE: The old structure was based on product and geographic location. We had independent channels that were largely driven by product, but then within the channels, we organized by geography. Where we need to move to is to an organizing principle that is by customer and by customer segment and then have the channels arranged in a way to support that.

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CRN: We've been hearing about a lot of channel conflict. Not just Xerox and solution providers, but solution providers against solution providers, solution providers against agents, and so on. Xerox has one of the most complicated channel structures. Is this going to streamline things?

FIRESTONE: It should simplify. I think how we got to where we are is we've had multiple channels, all of whom had been seeing this evolution of the customer need and trying to address it by broadening the breadth of what they're offering, and each trying to optimize within their channel. So that led to some overlapping dynamics. And if you're within a channel program, we get actually fairly high scores on channel programs. I don't think one size fits all.

CRN: What are you doing to bring your direct-sales force to work with the channel guys? Have you changed their compensation structure?

FIRESTONE: First, for the direct side, we've realized the value they bring to the marketplace is to be able to explain the Xerox portfolio across the hardware, software and services as well as across geography, national and global. And so, we are focusing their customer relationships where that is what the customer is looking for. We're concentrating the focus of our direct-sales force and broadening their skill set to deal with the full range. Part of broadening that skill set is to recognize that we will need to work with partners.

Theme No. 2 is we have changed compensation for the direct-sales force to encourage more partnership with the channel. And some of it is compensation, but some of it is mind-set—mind-set and training and understanding of where we're trying to take the company.

CRN: So you're going to let the partners play in the big accounts along with your direct-sales force guys?

FIRESTONE: Yeah, but it will be offering-based with the large accounts. So there will be a set of accounts where clearly our primary thrust will be to go to market through our direct relationships, but then in offerings or products, work with partners for bringing in the pieces.