HP Readies New Enterprise Program

The concept soon will be tested by HP's Enterprise VAR Council, and the vendor hopes to roll it out nationally on Nov. 1 under the HP PartnerOne program, said Susan Reynolds, Americas vice president of partner development and programs at HP, Palo Alto, Calif.

"This is a reward for partners when they sell across services delivery, OpenView, servers and storage," Reynolds said.

HP has not finalized the details of the program, including which products and services would attract incentives or how much the incentives would be. But whatever is offered will be an improvement over current attach-rate SPIFs that are offered on an irregular basis and usually only for a quarter or six months at a time, Reynolds said.

Enterprise sales cycles are typically longer than six months, and solution providers targeting this segment have had difficulty factoring in such incentives when they are preparing long-term project proposals, she said.

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"As a tool in PartnerOne, partners now will come to expect it as a standard offering," Reynolds said. HP enterprise solution providers said they like the idea of attach-rate incentives, but HP had initially proposed a minimal percentage bonus that solution providers told the vendor was not enough.

"The partners were not thrilled with that. It's a more difficult sale to attach some of those products. We offered other proposals," said one solution provider who requested anonymity. "HP eventually came back and said they will look at increasing the bonus."

The right incentives would prompt partners to want to include more HP products in a solution design, the solution provider said. "If you are trying to sell an EVA [midrange storage array], why not try to attach HP services and software instead of selling another vendor's software?" he said.

Incentive programs need to be in place longer for solution providers to want to use them, said Gary Van Vranken, sales manager at Integrated Business Solutions, a solution provider in Salt Lake City.

"HP needs to understand that reseller margins need to be protected if they want us to sell more of their products. Anything they want to do to increase margin will change people's behavior," he said.