Sennheiser restructures North American operations to improve channel efficiency

With the restructuring of Sennheiser into two separate business for the start of 2020 on schedule, the part of the company focused on unified communications has already implemented internal and channel sales changes.

Jim Fairweather VP of sales and marketing – Enterprise Solutions Americas, Sennheiser

ORLANDO – Last year, a mutual decision to terminate a joint venture between Sennheiser and William Demant set January 1 2020 as the date on which to divide the business, with the Sennheiser unified communications business transferring to a new company. Jim Fairweather took over as VP of sales and marketing – Enterprise Solutions Americas, with a mandate to prepare the soon-to-be-new company for a more aggressive growth strategy. This week, Fairweather sat down with ChannelBuzz at the InfoComm 2019 event here to provide an update on how things are going.

When the split takes place, William Demant holdings, a Denmark-based holding company, will get fifty per cent of the Sennheiser Communications joint venture – the Enterprise Solutions, and the Gaming business. Sennheiser gets the microphone business, and the consumer music business part of the audio business, which is very complementary to their core microphone business. The microphone and consumer business will retain the Sennheiser name.  The UC part has been given the legal entity name of Demant Sound. While that moniker sounds more appropriate for a retail stereo store, it won’t matter much. A new and permanent name will be in place by January 1. More importantly, the new company will retain the Sennheiser branding on the products.

“The name is clearly a placeholder,” Fairweather said. “The split itself is already well under way. Our UK and French teams have already moved over and are operating as Demant Sound. My group in the Americas goes over September 1. We have already built out a new office in Old Saybrook CT, and will be moving out of the Sennheiser office, although we are only moving two exits down the I-95. The transition is in full swing.”

Sennheiser is third in the UC business, behind Poly – as Plantronics rebranded itself after its merger with Polycom – and Jabra, but Fairweather believes that the new company, as part of the large publicly traded William Demant, will be able to follow a much more aggressive growth strategy than Sennheiser which is a family-owned and run business. That’s a necessity, he said, in a competitive market like unified communications.

Fairweather has been making changes in the company’s sales organization already however, which he said will mesh well with a more aggressive strategy.

“I changed the sales structure in the U.S. effective January 1, and hired ten additional people,” he said. “We now have a direct touch sales organization in most major cities, as well as our inside sales team. That has enabled me to put together team consisting of an outside person, an inside person, and an SE to cover each sales area. It works very well.”

Fairweather also emphasized a new emphasis in sales on focus, alignment  and accountability.

“Before salespeople had direct end user, channel and separate product line responsibilities,” he said. “They had little focus and were spread too thin, doing three jobs, none of them well. The new alignment has the inside and outside reps aligned with SEs, but also has channel managers clearly aligned with partners, which they were not before. Strategic alliances are tighter. Managers now have clearly defined partners they manage, with a distribution team, a DMR team and a reseller team.”

Fairweather has also expanded the channel group, including more channel marketing people and support programs. A brand new partner portal is due around the September timeframe. A new channel management team has also been put in place, to directly manage all distributors, DMRs and resellers.

“Before, while we used distribution, we also had about 36 resellers with whom we dealt with direct, that bought anywhere between $10 and $10 million,” he stated. “That Tier One distribution was impossible to manage. We moved almost 30 to distribution, which eliminated all kinds of channel conflict for me. We were always in arguments that the direct partners got a better margin than through distribution. Now it’s all distribution except half a dozen.”

Fairweather would prefer that the DMRs, who remain in Tier One distribution, move to Tier Two distribution as well.

“Partners like Insight and CDW buy about half direct from us direct and about half through distribution,” he said. “I would like to move them into distribution as well. Distribution better fits the DMR model, because they don’t want to buy inventory and hold it.”

The strategic alliance organization has been expanded. It includes Microsoft, Amazon, Cisco, and now Zoom Video Communications, whose new partnership with the company was announced this week in conjunction with InfoComm.

“This is a very strategic announcement for us,” Fairweather said. All of our headsets and conference phones are fully certified on the Zoom platform. This follows on an announcement a couple weeks ago that we are now fully integrated into the Amazon Chime platform. We will continue to grow and expand our products in the UC space. This is critical for us because we are a device provider. We have to run on every UC platform. People use different platforms, so you have to work on all of them.”

Today, the last day of InfoComm 2019, this part of Sennheiser is at West Level 2,  Booth 3588.

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