Here's one more...also a day old, but I don't remember seeing it posted here:
June 22, 1998, TechWeb News
Direct Sales strategies -- Compaq Defines Channel Moves
By Robert L. Scheier
New York-Compaq Computer Corp. had good news and bad news for
resellers last week as it finalized its $8.4 billion acquisition of Digital
Equipment Corp., Maynard, Mass.
The good news is that Compaq resellers will be able to resell high-end Digital
technologies such as the Alpha chip and Digital Unix, both of which Compaq
hopes to turn into mainstream 64-bit standards, which could compete with
Intel's Pentium processors and Microsoft's Windows NT. Digital resellers will
work with a vendor who values the channel more than Digital, which sold 45
percent of its products direct. Both channels will be able to resell services
provided by the new combined company and, in some cases, get pulled in for
subcontracts at big accounts that would have been inaccessible before.
The bad news is that Compaq will sell direct if the customer demands it, and
even, at times, when the customer does not, guaranteeing that, in some cases,
"we will have conflict," says Pearse Flynn, Compaq's newly appointed
worldwide vice president of channel development.
For example, Compaq is designating roughly 300 customers as "named"
accounts to whom it intends to sell services direct, giving the largest enterprise
or global customers the assurance that a $38 billion Compaq-not a
reseller-stands behind mission-critical applications, such as mail and
messaging, or enterprise-resource planning (ERP) software, such as SAP R/3.
Compaq is also expanding its DirectPlus program, which allows SMB
customers to buy through a toll-free number.
When a reseller who serves a corporate account leads with, say, IBM or HP
products instead of Compaq, the Houston-based vendor won't hesitate to
counterbid with itself or with another reseller. Compaq has already deposed
the "incumbent" reseller for a $75 million to $100 million contract with a major
account, says vice president of North American sales Mike Pocock.
In most cases, though, Compaq will still move products to customers through
resellers and subcontract service work to them. If Compaq reaches its goal of
becoming a $15 billion IT services provider by 2002, Flynn estimates that will
generate $5 billion in additional services work for the channel. To get a crack
at the best accounts, however, both Compaq and Digital resellers will need to
meet stringent new training and skills requirements.
Compaq executives have spent months working with channel executives to
develop extensive "rules of engagement" (see chart) to minimize channel
conflict. While not every channel partner will like every rule, "There is a clear
strategy" to which both sides can refer, says Doug Antone, senior vice
president of Ingram Micro Inc., a Santa Ana, Calif., distributor.
Working with Compaq will be no different than working with IBM Corp.,
Hewlett-Packard Co. or the former Digital, says William Tauscher, chief
executive of systems integrator Vanstar Corp., because he has long resold
products from those vendors while competing with them for service business.
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COMPAQ'S RULES OF ENGAGEMENT
Customer And Service Level
- 300+ "named" accounts implementing mission-critical or mission-sensitive
applications such as SAP.
- Same 300 "named" accounts requiring less complex warranty or systems
integration work.
- Small and midsize businesses needing warranty or systems integration work.
- Medium to large customers served by "incumbent" reseller.
Who Does The Work
- Compaq sells direct and is prime contact with customer; does most service
itself.
- Compaq sells services direct but subcontracts work to channel partners who
meet standards.
- Compaq takes first call from customer, refers them to local channel partner.
- Compaq works with incumbent on best mix of direct, indirect sales.
NOTE: This is a sample, not a definitive list, of the rules of engagement.
Source: Compaq Computer Corp.
Copyright r 1998 CMP Media Inc.
E.H.F. |
