Avnet's Cuen: We Want More Sun, More Vertical Solutions

Avnet Partner Solutions has been churning out new initiatives and vendor linecard additions in the first few months since Fred Cuen took over as president of Avnet Technology Solutions Americas. Cuen, a popular figure with Avnet solution providers, recently talked with CMP Vice President/CRN Editor Heather Clancy and CRN Distribution Editor Scott Campbell about several trends in the channel and what more to expect from the Tempe, Ariz.-based distributor. The following are excerpts from the conversation.

CRN: Several vendors including Hewlett-Packard and IBM are introducing programs to reward solution providers for selling their brand. How do programs such as HP’s AttachPlus affect you? Does it change how you deal with particular vendors?

Cuen: First of all, we have fairly significant relationships with several suppliers and ISVs in the marketplace today. What we do with them is focus on how to grow their businesses. That’s what distributors are in business for--to create opportunities for partners and suppliers. For us, this type of announcement allows us to continue to focus on enablement associated with a particular product set or solution set and rewarding those partners for selling more. In this case, [HP] is looking for their partners to sell a total solution. It creates a win-win situation for the manufacturer and the partner at the end of the day which hopefully ends up with a great solution for the customer.

CRN: In addition to IBM and HP, you also sell Oracle and StorageTek. How do you market those vendors when IBM and HP want you to sell more of their products. How do you strike that balance?

Cuen: It’s an interesting question. Our ability to grow each of our suppliers’ businesses is at the forefront of what we do. Through our second quarter, we have been able to grow the businesses for all our major manufacturers. I think there is a balance and there is specific enablement that we provide to all our manufacturers. The example of Oracle is a good one. I think they’re a complementary solution to all manufacturers. It is an application that solves a business requirement for a customer and is complementary to other products in the environment.

Sponsored post

CRN: Do you have to undertake any specific initiatives in programs such as AttachPlus to help solution providers increase their attach rates?

Cuen: It’s in our best interest to help VARs be successful. By providing our partners with the enablement to sell more storage, that’s a good thing for us. It’s a good thing for them and for HP. It’s an enablement opportunity. Let’s make sure our partners have the best skills and support available to grow everyone’s business. Distribution’s focus is growth not only of our suppliers, but also the partner.

CRN: Do you have to place more resources or train more employees towards a certain area? Or set up any specific programs to help the vendors reach this goal?

Cuen: For this announcement, we have people in place today focused on storage. We conduct a number of enablement activities that include sales and technical training. With programs such as consolidation for storage, we put marketing demand or creation out there. Ultimately we link the supplier and the partner on opportunities to close that business. It’s really a process that we put into place called Market Connections that talks about identifying and defining what the opportunity solution set is, preparing and enabling our partners, training them, and then from a marketing standpoint creating what services are required for the enablement of the partners.

CRN: What do you when for every partner that says we want to be loyal to one vendor, there’s another partner that says if they walked into a customer with just one vendor they’d be shown the door immediately? They need products that may compete with an HP to show that he is a total solution provider.

Cuen: We live in a solution-based environment today. The end-user customer wants the products, services and software that will best bring them back a solution or the ROI required for their business. The solution provider has to be able to position a solution to provide ROI for that customer, whether that is through all the products of a particular vendor or portions from various vendors to provide that end user with the solution they’re looking for.

An example is ourselves. We’re Avnet. I have the ability to act as a business unit head. I will say to you my emphasis is on the best products of the solution that we’re confronting. That’s what I’m looking for. I’m looking for partnerships, with either manufacturers or partners that demonstrate various alternatives and to help guide me to the ultimate solution. It could be all products from a particular vendor, or multiple vendors. It really is based on the problem that you’re facing. Our role as a distributor is to grow our partners’ businesses, and that includes the manufacturers. If we don’t do that, they will find someone else to do so. We have to put plans in place that provide the people, the programs and the process to ensure their success.

CRN: It seems like it would be a difficult balance to strike. If your HP business grows faster than your IBM business, does IBM say ‘why aren’t you growing our business more?’ Or do they say ‘what can we do to grow our business more?’

Cuen: It would be the latter. If someone else’s business is growing faster than yours, you probably start to pay attention to what is going on. It could be a variety of things: superior service, software, programs, compensation that would enable that to happen. [Vendors] are in tune to what is going on. If they don’t see sales making progress, they are very willing to work with us. That’s reflective in our business growing significantly with all our vendors. You mentioned StorageTek before. Through December of last year, our StorageTek numbers given to us [by StorageTek] show our sales are up over 80 percent on a year over year comparison. We’re doing the things to help partners sell that product set.

CRN: Sun is planning changes with StorageTek that will have more of an effect in 2006. What are you doing to keep that business if you can’t sell to solution providers that buy Sun from another distributor?

Cuen: Our sales momentum with this particular brand has not decelerated. We have gotten great compliments from Sun and StorageTek. There are two methods of growing business. One is the continuing enablement of existing partners. Second, there is always is ongoing pursuit of new customers. Areas in which we may find partners are vertical markets such as health care. We can provide a lift to their existing base. That’s a big focus for us this year.

CRN: Do you have more of a focus on that now because of the changes with Sun and StorageTek?

Cuen: No. Solution selling is something we have been doing for a long period of time. At the end of the day, customers don’t buy a thing, they buy a solution. That’s one of Avnet’s value adds. One thing we’re constantly looking at is what technology, what trends, what vertical markets are growing so that we’re able to bridge software services and hardware together for partners. We do that for all the brands.

CRN: Are you having conversations with Sun to pick up more Sun lines going forward?

Cuen: We are working with Sun. We are excited about the opportunity of carrying more storage products with Sun. We hope that will become a reality in the near future. We have been demonstrating to them that a storage-only practice is very beneficial to selling more of their Storage products.

CRN: So you’re not going after Sun servers, but Sun legacy storage products?

Cuen: That’s correct. Our model of a storage-only practice has been very successful, year over year. It’s no secret storage in general is growing. We have a group focused on this area and it allows us to take advantage of this particular area. We’re also very excited that the partner community has provided their input in regards to what we’re doing.

CRN: What are some of the most important vertical markets you’re looking at?

Cuen: We have an entree into health care. We are looking at where the markets are spending money going forward. Healthcare was a dominant environment. There’s a lot of solution sets there. What we’re doing investing in programs, processes. We’re combining solutions with ISVs and companies such as Symbol and Intermec to provide comprehensive solutions in that environment. Partners want someone working with them that understands those markets. We could announce another vertical [focus] in the near future.

CRN: Do vertical market solutions lead VARs to pick up new vendors?

Cuen: You'll see us enabling partnerships between partners to grow their business. Initially, partners are interested in solving particular customer problems. You start to see server and storage VARs looking at the Symbol product line as a tool set to solve customer problems.

CRN: What other areas of technology are you focusing on?

Cuen: We’re looking at networking and mobility, which are high growth areas. I would say stay tuned. Looking at the trends, a big area in networking is mining. We need to be able to offer additional solutions on the networking side. [Solution providers] are asking us for it. It’s also complementary to products we sell today. When you think of Avnet, we want you to think solution sets that solve customer problems.