Data center News
Lenovo’s Steve Biondi On Winning Dell, HPE Partner Mindshare
‘Are there challenges within the partner community saying that other vendors take deals direct and are a little unpredictable? Yes, that’s real. For Lenovo, that’s not,’ says Lenovo’s North American channel chief Steve Biondi.
‘Every Deal Is For The Channel’
Six months ago, Steve Biondi became Lenovo’s Data Center Group North American channel chief with the goal of revamping the company’s strategy to win over partner mindshare from competitors like Dell Technologies and Hewlett Packard Enterprise while also driving profitability for Lenovo partners “wanting to grow with us.”
“We went out to partners and said, ‘Look, we have better technology than the competition. We have a better price point. We have a partner program now that’s enticing,’” said Biondi, Lenovo’s Data Center Group’s North American Channel Chief, in an interview with CRN. “We’re growing our Platinum partner base by almost 50 percent in one quarter. Why is that happening? Our supply chain is better, we now have a program that’s a lot more meaningful that shows them how they can make money by selling with us, a next-level support strategy and coverage model -- our plan is working.”
On April 1, Lenovo Data Center Group (DCG) unveiled new channel benefits in its flagship partner program designed to incentivize solution providers to lead with Lenovo over the likes of HPE and Dell by adding additional rebates for exceeding growth targets and acquiring new accounts. New benefits include allowing Platinum Partners to earn up to 40 percent more for similar year over year performance; new dedicated pre-sales and technical support for Platinum Partners; a 30 percent increase in DCG back office support resources; and a new competitive bid incentive program – Competitive Opportunity Partnership Program (COP) -- to focus on whitespace accounts. CRN spoke to Biondi before learning of the departure of Lenovo’s DCG global channel chief Nicole Roskill.
“Are there challenges within the partner community saying that other vendors take deals direct and are a little unpredictable? Yes, that’s real. For Lenovo, that’s not,” said Biondi. “Every deal is for the channel.”
In an interview with CRN, Biondi talks about winning over partner mindshare from Dell and HPE, his bullish channel vision and teases the upcoming release of a new partner portal.
What is your strategy to win over channel share from partners who have been traditionally focused on selling Dell and HPE? What’s Lenovo’s differentiation?
So you see announcements from our competition about lowering thresholds and trying to be more accommodating in the current climate -- we’ve taken a different approach. I’ve gone out very surgically, spoken to our big distribution partners saying, ‘How can I help you? Do you need better terms? Do you need us to lower our inventory threshold? How can we help?’ And they’ve given us surgical things to go apply and we’ve done them. We’ve done that with our Platinum and Gold partners as well. So not a broad sweeping thing, but instead, we’re going very specifically to the partners saying, ‘How can we help you with this opportunity today? And how do we keep that maintained?’
We’ve taken that same of thinking and gone after some of our competition’s ecosystem to say, ‘Look, with the pandemic crisis going on, our supply chain really had very limited effect.’ The biggest effect that we’ve had was not enough planes to be able ship our stuff around. Lenovo’s supply chain is very diverse, meaning in China, in Europe, in Latin America, etc. While some of the facilities had some issues, they were resolved quickly. We never really got past four or so weeks of supply chain shipment delays and normally, it’s about two-and-a-half weeks anyways. So we didn’t see a big impact where some of our competition were telling their partners to buy in May for autumn delivery. Deals are perishable. We went out to partners and said, ‘Look, we have better technology than the competition. We have a better price point. We have a partner program now that’s enticing. If we can help you save a deal and satisfy a customer more meaningfully, give us a shout.’ And they have. We’ve seen success with that and we’ll continue to push it.
Why are partners picking Lenovo over HPE and Dell?
We’re growing our Platinum partner base by almost 50 percent in one quarter. Why is that happening? Our supply chain is better, we now have a program that’s a lot more meaningful that shows them how they can make money by selling with us, a next-level support strategy and coverage model -- our plan is working. The things we put in place in our first calendar quarter are working.
We’re getting a lot more surgical about getting partners who can help us in major cities where we don’t have many partners. We’re getting partners to help us with different solution offerings like storage, etc. The growth that we’re seeing now is by design. That’s working out for us. We’re moving a lot of that acquisition conversation back to our distribution partners. We’re going to continue to see the kind of growth we’ve already seen in one quarter for the balance of our year in terms of growth in our partner program.
What is Lenovo’s market differentiation around data center as-a-service versus Dell Technologies Cloud or HPE GreenLake?
The success of the competition’s strategy right now has been lackluster. I think the approach we’re going to take here is, I’m going to do three things really well, then the next three things, then the next three things, etc. We have an amazing market position compared to our PC counterparts. Is there a way to come to market together and approach an as-a-service consumption model different from our competition? The answer to that is ‘yes’. I know some of our competition play in both camps as well, but from a deployment standpoint, we benefit from our channel-first mentally now. What it means to us is any deal we find, we give to the partner. So ever single net new deal, unless the customer mandates they want to go direct – which doesn’t happen very often – we give to the channel.
What are some other channel differentiators between Lenovo as-a-service strategy compared to Dell and HPE?
Our comp model for our direct sellers is channel neutral. So they get the same credit if they sell it or if a partner sells it. So we have zero friction as it pertains to channel conflict out there. Does our competition have that? They do not. Are there challenges within the partner community saying that other vendors take deals direct and are a little unpredictable? Yes, that’s real. For Lenovo that’s not. Every deal is for the channel. Every deal will allow our partners to compete fairly and equitably. I think that puts us in a different position.
We now have a joint process going into as-a-service consumable, leveraging the strength we have on the PC and personal device side, with the great data center technology that we have here – that sets us apart. So our ability to embrace other hybrid offerings, leveraging our great alliances we have with the likes of Microsoft, VMware and Red Hat – that’s going to put us in a different kind of position.
What we’re going to double click on is the notion of hardware-as-a-service, device-as-a-service, etc. I would say of the big x86 vendors out there, we are better positioned than any of them to do that. We don’t have baggage of other on-premise solutions that we have to be concerned with as others do. As we move forward, hardware-as-a-service, embracing MSPs and CSPs more proactively is where we’re going to put more emphasis on.
How are you enabling partners to help customers during the COVID-19 crisis?
The biggest challenge that our partners had, initially was financial support. ‘If you could extend our terms that would be hugely beneficial. If you can give us addition technical support like implementation services or additional architect support, that would be very helpful,’ -- we heard that a lot. In our first calendar quarter, we changed the program to be more lucrative to partners and we changed the coverage model. So I already had my entire technical team dedicated to our distribution partners and Platinum partners. Because of that, when they were asking for additional financial terms, I think we went above and beyond in providing support. When they needed addition help in terms of people showing up -- virtually of course -- we already had that coverage model in place. So the biggest challenges that our partners were facing on financial support and technical support, we came to the table.
The next step was, ‘How do we retrofit some of the offerings that we have?’ We have this marketplace approach called On-Demand were partners build solutions for VDI, hybrid offerings, etc. So we started a campaign through our NSP [National Solution Provider] partners for these solutions. We went out and did huge events to get NSP partners enable to sell our On-Demand offerings. Normally, you’d have 45 or 60 people that show up to one of these education events. We have upwards of 150 people joining. That helped us move the needle. We’re showing up, that’s the key. We’re not afraid or shying away from our partners. They also know that we’re not going to take the deals direct.
What are some things you’ve changed to improve Lenovo’s partner strategy thus far?
When I first got here six months ago, it was clear to me that the program itself was very behaviorally based, meaning, if somebody got a new partner or a new customer – whether they were Silver or Platinum tier status – they probably got the same experience from us. I saw people wanting to grow with us. So my message from day one was, ‘I want a program that allows partners to grow and want to grow with us.’ So step one: rebuild the partner program, which we did in the first quarter. So from January to end of March, we took the time to rebuild the program that we launched April 1. The program now has very declared steps between Silver and Gold, Gold and Platinum, etc. So now there’s meaningful benefits in terms additional margins and additional support for each step partners take with us. That was just necessary.
The second thing was, we had a coverage model that treated a lot of partners the same. The program was kind of socialistic and the coverage was as well. I wanted to change that. I wanted to have, I call it, ‘Covering the people that can move a lot of dirt for us.’ I made sure we had proper coverage on our distribution partners and proper coverage for our NSP’s because those guys can really move the needle for us. I made those changes in the first quarter as well.
The third thing was, the technology we have is best-in-class, but it seemed as though we were not as aggressive as we needed to be as it pertains to competitive engagements and declaring we have the best stuff out there to the partners. Those three things were the benchmark for the first quarter.
Talk about momentum after revamping the partner program?
From a participation rate, our participation rate is off the charts. Distribution partners really grabbed on to the fact that we’re driving the right kinds of behavior to let them help us acquire new partners. So we’re very focused on how to grow and leveraging the partners that know how to do that best. We’re also pushing competitive engagements. We are really on our toes here letting our competition know that we have solutions that are best in class and not afraid to show up. We have several hundred new engagements where people who weren’t buying Lenovo in the past, are now buying Lenovo. That trend is going to continue.
What can Lenovo channel partners expect next?
Moving forward, people are now getting way more accustom to end-to-end inquisition about technology and buying it virtually. We don’t have people going out and knocking on doors, having to do in-person demos, a live show, etc. -- we can do it all virtually. So what that means to me is that we now have to change our enablement. We have to change our thought processes from the standpoint of, ‘When you’re selling a solution, we’re going to start to focus on three deliverables for each solution that we sell.’ So I like to call it “crayon ready”. If you gave this to one of your children, if they can understand what it means -- that’s “crayon ready”. So when you have NSPs and people with volume targets, you want something that is easy to learn and digest in order to break some of the muscle memory in selling other vendor’s stuff.
The next deliverable is business-ready, which means, ‘So now that I have your attention, let me explain to you the value of what we’re doing and why it makes sense to consider our solutions.’ Another deliverable is what I call “nerd-ready”. I was a system programmer in my previous life, so I can proudly declare I’m a nerd. “Nerd ready” means that now if you can portray to the technical community how to define reference architectures, how to make sure it integrates with the rest of the data center, etc. – you’re going to get a lot more traction.
You’re going to see a very different approach for Lenovo in terms of how we get our enablement ready to be consumed if people get more comfortable with the virtual end-to-end story. We need to be prepared for that. We’re going to have our first enablement be launched when the new portal comes out. Then all of our subsequent solutions will fall into the same enablement strategy. So the program’s fixed. The coverage model is fixed. We really putting a lot more emphasis around enablement and certification.
With virtual sales and marketing being key during COVID-19, can you provide some information on Lenovo’s upcoming new partner portal?
The portal allows you to have different personas. Today in our competition’s portal, you’d log in and then have to navigate your way to the things that you wanted, commensurate with what you are trying to accomplish, etc. Our new platform can say, ‘Oh he’s a sales guy. He needs access to all the sales material – how to build pitches, how to get pricing, how to ensure deal registration and sales-oriented stuff.’ On the other hand, ‘This person is running all the marketing. So we’re going to have a persona for her to do marketing. That means she has access to all the marketing collateral, all the marketing campaigns, where are the press points that we can apply, etc.’ So having a clear path for people when they log into this thing is really meaningful. So up to date pricing and all the stuff you would expect. This is a big investment for us.
Is the portal just for Lenovo data center partners or for partners on the device side as well?
It’s not just the data center group. It’s going to be a single platform for both partners that sell DCG and the device side of the house as well. So the partners that sell both will have one platform. They’ll get up-to-date pricing on all this stuff. The same kind of market intelligence information and the same kind of pitch presentation, all in one place. You’re not having to hunt around for it. We want to show our partners and other partners in the fray, it’s all about them. We want them to have an easy experience. We think we’re the easiest vendor to do business with. We think partners can make the most money dealing with us and we have the solutions that satisfy customers more than anybody.