Lenovo's Kirk Skaugen: 'Our Channel Momentum Is Stronger Than Ever'

New Day For Lenovo's Data Center

It's a new day for Lenovo partners, said Kirk Skaugen, executive vice president and president of Lenovo's Data Center Group, as the company forms a strategic partnership with NetApp to attack new market segments along with a revamped channel program and partner recruitment strategy.

"We're confident that channel partners are going to see that this is a very different company than they may have known three years ago," said Skaugen, in an interview with CRN at Lenovo Transform 2.0. "It's an amazing time for our existing NetApp and Lenovo partners, but it's also an outstanding time to bring on new partners that maybe feel disenfranchised right now. … We're going to be the most channel-friendly storage company on the planet."

Lenovo is gearing up for a channel market assault with new incentives to drive storage sales, a nimble supply chain and investment in channel account managers in every country. In an interview with CRN, Skaugen talks about Lenovo's channel charge and putting the heat on competitors like Dell EMC and Hewlett Packard Enterprise.

What does NetApp bring to Lenovo's channel and do you expect to win over any Dell EMC or HPE partners?

Lenovo has traditionally seen twice of our share going to the channel compared to most of our competitors. So twice as channel friendly. What drove a lot of this [NetApp] partnership is actually channel pull. Some of our competitors are taking more business direct. Some of our competitors are exiting markets in the world; whereas Lenovo is committed to the channel and participating in more than 160 countries in the world. I can tell you there's channel partners from South Africa, India, China, Latin America who have been with our competitors for decades that are saying, 'This is the time to move to Lenovo because they now have a portfolio.' If you think about the channel, we were only covering 15 percent of the storage market. This partnership now allows us immediately to get in the midrange and cover more than 90 percent of the market that Dell EMC or HPE can cover. It's an amazing time for our existing NetApp and Lenovo partners, but it's also an outstanding time to bring on new partners that maybe feel disenfranchised right now.

Talk about Lenovo's channel momentum over the past 12 months?

Our channel momentum is stronger than ever. If a customer demands to be direct, of course we have to be customer-centric, but other than that, our business through the channel is stronger than ever in every single geography. … We've completely revamped our channel program to have Silver, Gold, Platinum tiers. A year and a half ago, we had four different channel programs and four different geographies. So the channel program itself has been completely revamped. Since our Transform event last year, we've had more than 11,000 people certified and trained on Lenovo products. The more you get trained, the better rebate structure we'll give you.

What has driven such a surge toward Lenovo in the channel community?

Two things happened. Number one, we required data center partners to be certified on data center. Compared to 18 months ago, you could have been a ThinkPad partner and carried a Platinum logo. So we now do require partners to be both the device expert as well as a data center infrastructure expert. That was very well received by our data center partners because you don’t want to get a different discount structure just because you were shipping PCs. So they now get on their business card a Lenovo Storage certified expert and have that distinctly separate from just, 'I sell a lot of personal computers for Lenovo.'

The second is that, we had large partners in the past who had three different rebate structures in three different geographies because we had three different channel programs. We've now gone to a globally consistent program so if you're dealing with multi-national customers and you're selling in France, the U.S. and Brazil – you now have a consistent program to work with Lenovo on. We've become simpler to work with by putting channel managers in every country. In India, for example, we have a new channel executive responsible for India to show the dedication to the channel in our major markets.

Will there be new partner incentives to drive the new co-developed NetApp and Lenovo products?

We will have incentives around these new platforms. We're going to be very aggressive. If customers get their hands on the technology, they will love it. It's just a matter of getting those systems in place. The good news for channel partners today is you can order and ship immediately. We'll be building these products around the world –in Mexico, in Hungry, in China, in Brazil – so we'll have a very nimble supply chain as well.

What does it take for a NetApp partner to get certified to sell these joint solutions?

For a NetApp rep, there's a program in place to easily qualify to be a Lenovo partner. We expect a lot of [NetApp partners] will expand and become Lenovo partners and pick up the server side and be able to go after those full-stack opportunities.

How does Lenovo's data center strategy differ from your competitors?

We believe we're operating at twice the velocity of our competitors. The structure we built is end-to-end segment general managers that are responsible for very clear customer-centric segments. So we have a general manager in charge of the global hyper-scale market. We have a general manager in charge of our supercomputing and artificial intelligence business. We have a general manager for our software-defined business. A general manager for our server and storage infrastructure business, IoT, telecom, etc. – this is enabling specialized channel partner to work with a Lenovo general manager who runs all the decision making. That means we can operate with very high velocity relative to our competition. That's why there's so many announcements happening over the last year as transformation is happening at a greater speed than ever before.

Give me one area where Lenovo has a leg-up on the competition?

It's a dynamic market right now in the supply chain world. As governments negotiate, we have factories in every corner of the Earth. We have servers in the North Pole and servers in Antarctica. I think we're on every continent now. The supply chain will help us deliver the best channel experience this year.

What’s your message to the channel community?

We're going to be the most channel-friendly storage company on the planet. We want to welcome the channel to join the Lenovo channel program. We want to be their most trusted partner. A year ago, we launched the largest server portfolio in our history. And today, we are the world's fastest growing server company that's very channel friendly. We're now launching the largest data management and storage portfolio in our 25 year history. We want to be the fastest growing storage company in the world and be number three in China. For our channel partners across 160 countries, we want to them to experience the Lenovo way. We're confident that channel partners going to see that this is a very different company than they may have known three years ago.