The 10 Hottest Networking Products Of 2023
“We’re taking the gloves off. We’re pleased with our partnerships around the world. They’re pleased with what they’re doing with Dell. They love our portfolio. They love the fact that they can do client service, storage, backup, edge, multi-cloud, cyber resiliency, they love the story,” Dell Technologies President of Global Sales and Customer Operations Bill Scannell tells CRN. “We’re a market leader, but there’s a whole bunch more to go get.”
Dell Technologies’ shift in how it approaches storage sales is meant to show partners that the company which gave birth to the direct-to-consumer PC sales model is serious about doing business through the channel.
“Our partners keep saying they want better collaboration with us, better predictability, better teaming. And we’re doing that, and the feedback has been awesome,” Dell Technologies President of Global Sales and Customer Operations Bill Scannell (pictured) told CRN. “This partner-first strategy for storage intensifies our focus on selling storage through our partners and doubles down on our commitment to our partners.”
Starting this past Monday, Dell said it would compensate its core sales teams more if they move storage deals through a partner of record. In addition, the company quadrupled the number of eligible partners for Dell’s sales teams to target and handed them a directive to take share from rivals.
“We’re taking the gloves off. We’re pleased with our partnerships around the world. They’re pleased with what they’re doing with Dell. They love our portfolio. They love the fact that they can do client service, storage, backup, edge, multi-cloud, cyber resiliency. They love the story,” he said. “We’re a market leader, but there’s a whole bunch more to go get.”
The company holds the No. 1 spot with 31.5 percent market share among enterprise storage and is in the top spot with 11.2 percent share in storage software.
Dell sales teams are now going to proactively bring more partners into accounts, incented by a 1.1X multiplier, according to a memo posted to TheLayoff. Sources have told CRN that Scannell wrote the memo, but when reached for comment a Dell spokesperson declined to confirm its authenticity.
“They’re going to really realize that we’re serious about this and the trust is going to be stronger than ever so they’ll bring us into more accounts,” Scannell said of the move to get closer to partners. “We know when we work closely with partners, we exceed customer expectations and at the end of the day that is what this is all about.”
Neil Hall, North American president of one of Dell’s Titanium partners, Computacenter, agrees with Scannell and is embracing the change in course.
“It gives predictability and strength to the channel,” he told CRN. “This is the biggest step I’ve seen from a vendor to place much greater significance on the channel in one sweeping move. We want to be there. We want to be a strong partner for Dell and build great success stories for our customers.”
CRN interviewed Scannell and Dell Technologies’ John Byrne, president of sales and global theaters, on the Friday prior to the change going into place. Both men talked about the strategy behind the new plan as well as what they are hearing from customers and partners in the field when it comes to deploying generative AI solutions.
“I got to record this week. I got to six minutes in a meeting before AI came up,” Byrne said. “All of that is not only driving significant demand for AI-capable servers, it’s also driving unbelievable amounts of storage. What does that mean? More storage. What does it mean for the channel? More storage through the channel. And that’s a message we’re delivering.”
Shortly after the announcement was published this past Monday, Dell confirmed there would be “some” layoffs to its sales teams. Dell has not indicated how many jobs were cut, or if the cuts were related or in addition to the 6,650 announced in February.
This is about a new go-to-market strategy?
Scannell: So effective Aug. 7 Dell will compensate our sellers with more money when we leverage and sell through storage and data protection, through our global ecosystem of partners. So let me say that again, effective Aug. 7.
We’re actually going to pay more to our sellers when they transact and work with a partner to sell storage and data protection. That’s a huge shift from our go-to-market.
This is a major announcement that we’re making on Monday, and it’s a huge change to our go-to-market.
We’re calling it ‘partner-first strategy for storage.’ And so let me kind of frame it up a little bit if I could.
So as you know our businesses is strong. You saw our Q1 results. So we’re happy with the way the business is performing. But as I keep saying, the markets are coming our way and our strategy I think is spot on.
So if you think about it for CSG [Client Solutions Group], the whole future of work and focus on hybrid work and the end-user experience is paying off. Customers are saying, ‘Hey, look at that. I love your Apex strategy. I want to do PC-as-a-service. I want you to take over the whole kit and caboodle,’ and we’re doing that right now very effectively. And then you think of ISG [Infrastructure Solution Group], our strategy around multi-cloud, helping customers get the right balance of what goes public cloud versus private cloud, that’s going real well.
We’re seeing a huge uptick of customers who are saying, ‘Hey, I want to bring some of these workloads back on-prem because it’s expensive.’ In fact, just this week, we got a five-year $100 million engagement to help bring workloads back from one of the public clouds, back on-prem for a large global customer of ours.
Our business and our strategy around cyber resiliency and cybersecurity is paying off. In the last week we had one of our customers have a malicious ransomware attack where all the data was deleted. Luckily, they had a good copy of the data in one of our cyber vaults and they were able to quickly recover from that ransomware attack. Without that vault, they would be down for literally weeks.
Our strategy around edge and far edge is really paying off.
When I last spoke we talked a lot about AI, and the market is just absolutely exploding and we’re benefiting from that. All of these transformations are driving a huge need for storage.
So as the market leader in storage and data protection, I think we’re really well positioned to continue to win big here. And we know that we win more often and faster when we work closely with our global partners.
So your direct sellers are getting more money to work more with your reseller partners did I understand that?
Scannell: Our channel resources only get paid when it goes through that channel. So they’re highly incentivized to make sure everything goes through the channel. Our storage specialists and all get paid on storage, whether it goes direct or through a channel partner.
This is incentivizing the last leg of that stool. Our direct sellers who work with the channel to make sure that they’re incented to bring channel partners into play and to strategize with them, to do account planning, and make sure that we sell through the channel partners and they will make more money. We’re going to give them an uplift when they transact through a channel partner versus direct.
The message we’re sending here is, ‘We love the channel.’ We’re going to more proactively bring them into more accounts. They’re going to realize that we’re serious about this and the trust is going to be stronger than ever, so they’ll bring us into more accounts. We know when we work closely with partners, we exceed customer expectations.
John, you were going to talk about the new setup for partner of record?
Byrne (pictured): We’ve loosened the criteria on partner of record so there’s now a 4X opportunity. So what does that mean? A direct seller is working with a customer, we’re telling them, partner accordingly. If you’re a partner of record then you’re building your account plans, and you’re building your strategy with the end customer and it could be any of those big customers. [Dell’s direct sellers] partner with the partner of record. So it gives that partner the comfort that they’re protected and their investment is protected.
Which you may have heard them say previously, ‘Hey we love Dell, we’re making a lot of money on the program, but is that predictability of engagement going to be there in the follow-on sale?’ Now we’re saying, ‘Yes. You’re the partner of record.’ We have to make sure our own seller and the partner of record are actively engaging with the customer. But look, if another partner finds an opportunity within that account, then the deal registration process that we have will remain in place.
So look, we’re excited by it. It’s a big change within the company on Monday. We think the partners are going to love it. Partner up.
The partners can say, ‘When I partner with Dell, I have the portfolio. I have the momentum. I’ve got the team. And I’m protected in my engagement.’ We think it’s pretty special.
Bill, how big is the potential here, with direct sellers and partners working together on these accounts?
Scannell: We think this could open up the floodgates. I spoke to half a dozen partners this week and a couple of them about this particular strategy and they just love it.
But even the ones I talked to, if we didn’t talk about this, you know, it’s quarter end, and we’re working closely with them. Our foundation right now is very, very strong, and it’s built on trust and open communications. And I think the strategy gets a lot better.
This will drive better collaboration between Dell sellers and our partners that will drive better business outcomes for our customers. We’re going to generate more pipeline, we’re going to gain share. We’re going to sell more of the entire portfolio by doing this and that’s going to just deliver strong results for Dell. And for our partners.
I think we have just an incredible opportunity to scale our collective businesses and deliver great outcomes for Dell partners, but most importantly, for our customers.
Bill, there has been talk on TheLayoff.com that job cuts are coming to Dell on Monday. I don’t know if these are the layoffs announced in February or new ones, but what can you tell me about that?
Scannell: Look, we’re always looking at our business, and we’re always tweaking models to adjust to changing markets. So we’ll continue to do that. We’ve done it for as long as I’ve been doing this, we’ll continue to do it. And we’re focusing on growing the business.
John, with the generative AI solutions that Dell announced recently and the talk in the market, that comes with a need for storage. How does that dovetail with this new go-to-market?
Byrne: Any conversation you have with any customer, any partner around the world, once you get beyond cloud, once you get to beyond cyber as Bill had mentioned, the topic turns to AI.
I got to record this week. I got to six minutes in a meeting before AI came up. You saw the momentum, you saw the messaging at Dell Technologies World, you saw the excitement on our XE 9680s, and Project Helix.
Now you’re seeing enterprise and commercial companies saying, ‘OK, I now want to develop my own AI initiatives within the company.’ That can be on their e-commerce business. It can be on customer care, code development, sales and marketing.
All of that is not only driving significant demand for AI-capable servers, it’s also driving unbelievable amounts of storage.
What does that mean? More storage? What does it mean for the channel, more storage through the channel? And that’s a message we’re delivering.
Dell revenue was down last quarter. PC sales. Infrastructure. Projections are flat. This is a plan designed for growth. When are you going to take this concept from storage and apply it to PCs, apply it to servers, apply it to some of the other some of the other areas?
Scannell: One step at a time. Let’s perfect it for storage.
Here’s the way I look at the markets: It doesn’t matter what the markets are doing. If we have 30 percent share in storage, what we want to do is go take share from our competitors. This is an incentive, a further incentive, for our channel partners to lean in with the biggest, most professional sales and presales organization in the world, the biggest channel organization in the world with the best portfolio in the world, where partners make more money by partnering with Dell and now our sellers make more money. Let’s go take share. It’s ours for the taking. We’re going to lean into the partners, and the partners are going to realize we’re serious about taking significant share.
And we’ve modeled this [so that] we know this will help us take significant, significant share and we’re excited about that, always focusing on getting great outcomes for our customers.
What does this say about the maturity and sophistication of the the channel, that even a company with the size and reach of Dell and all of its capabilities that it still needs to rely on the channel for growth and sales?
Scannell: I’ll tell you what I told you before, I started my career 37 years ago selling storage. I had some success because I leveraged our channel partners. They were my best friends. And when I keep saying I love the channel, I love the channel partners because they’re an extension of our go-to-market. They’re an extension of our sales teams. This is just proof in the pudding as to how much we love our channel partners and now the entire organization is going to love them even more because they’re going to make more money.