Rewriting Dell’s channel DNA

Greg Davis Dell

Dell channel chief Greg Davis

A month ago Dell revamped its PartnerDirect channel program, growing from a two to a three-tier approach, with Registered, Preferred and Premier levels. caught up with Dell’s channel chief, Greg Davis, at last week’s inaugural Dell Storage Forum in Orlando, Fla., where he outlined how the program is doing and what partners can look forward to. A number of other Dell executives and partners also offered their views on just how the transformation from direct-only to a hybrid sales model is going.

The PartnerDirect changes were first considered when putting the program together, but we couldn’t deliver them then, said Davis. “The May announcements were fuelled by the Compellent acquisition of 450 trained partners. We were actually talking about doing this (three-tier model) a year from now.”

Dell would rather go slow than get it wrong, he said. “I can’t build a channel program in a quarter. We try to be very straightforward and stable… partners are trying to build a business and lack of stability can be really bad.”

Channel sales grew 40 per cent in the last quarter (Q1 of 2012), with 16,000 deals done in North America, and another 17,000 in Europe, Davis reported. Compellent sales more than doubled and are expected to grow even more this quarter. The company added 300 new partners and expanded into 12 more countries. The channel – 2,500 certified and 80,000 non-certified – accounts for more than a quarter of the company’s enterprise sales, and as it integrates the products, gets its partners trained and selling more of its products, and expands its global presence, that percentage is only expected to grow. He said the channel is expected to grow at least twice as fast as the industry this year.

Davis said the focus this year is pretty simple. “We acquired a great asset in Compellent, so making it a part of Dell is job one.”

The next focus is get every partner cross-trained. Most Dell partners have the minimum number of certifications and the company wants to dive deeper with them “We’re giving EqualLogic partners six months to get trained on Compellent, and giving Compellent partners six months to get trained on EqualLogic.”

He confesses that Dell missed an opportunity at last week’s event. He was walking by a partner when he was asked why the partner couldn’t have brought his staff to the event to get trained and certified? “We blew it. We will do it next year.”

Dell offered more than 75,000 training courses to channel partners in 2010, and Davis is looking to increase that to as many as 200,000 courses this year. The training can really pay off he said, with Dell’s top partners, as measured by percentage of staff certified, and not revenues, had a stellar year, growing their business 126 per cent in 2010.

Dell is also in the early stages of preparing for a more vertical market approach, going after segments like health care, education and managed services, Davis said. “We’re in the early stages and many aren’t channel-ready, but our commitment is to bring them to our partners.”

Channel conflict was a frequent concern among partners. In fact one Canadian partner who came aboard with the Compellent acquisition, doesn’t believe he’ll make it through the year because of how the integration was handled. While several other partners publicly acknowledged there were bumps in the road, they were also pretty bullish about the future.

“Dell has some legacy issues they need to overcome with the channel,” said Sonia St. Charles, CE of davenportgroup. However, she said she can’t say enough good about Compellent’s channel program and was told by Dell that they learned from the EqualLogic experience and are not going to repeat their mistakes. She added that she also sees the walls coming down between the direct and indirect sides of the business.

Frank Politano, a senior consultant at Syscom Technologies, a provider of data centre solutions since 1980, said the longer you work with the outside sales, the better the relationship. His company did its first joint Dell initiative almost three years ago and was able to fast-track a deal, with a very nice return and led to a lot more business. “We were able to leverage Dell expertise we didn’t have.”

Dell has tens of thousands of sales people, and while all the ones who handle the channel have been trained, it takes time to get everyone aboard, Davis said. “We still have a lot of work to do, but we’re committed to it.”