Dell unveils its 2020 channel strategy for partners, and ChannelBuzz has all the details.
The overall restructuring of Dell’s overall sales structure following the retirement of Mario Haas late last year will work to the benefit of channel partners. And some tweaks to Dell’s partner program were announced, particularly the expansion of Dell’s Partner Preferred program to add server incents to existing storage ones in underpenetrated accounts Dell is targeting. Those were the highlights of a virtual Global Partner Kickoff the company released on Wednesday to its channel partners.
Dell emphasized the significance in the presentation of what they termed a simplified Go-to-Market structure. In December, it was announced that the commercial and enterprise organizations are being combined under Bill Scannell, whose old role of President of Enterprise Sales and Customer Operations has been expanded with the retirement of former Dell President and Chief Commercial Officer Marius Haas. In addition, former channel chief John Byrne now leads the combined enterprise and sales team for North America, Chris Riley now leads the select sales team focused on 200 strategic accounts, and Steve Crowe will lead all specialty sales.
“Partners have been asking for this,” said Joyce Mullen, President, Global Channel, Embedded & Edge Solutions. “This will make us faster and more responsive in making decisions in one place.”
Scannell emphasized that the plan is not to disrupt things, and implied that from a partner perspective, this should be pretty seamless, but that there would be some organizational changes.
“If it’s not broke, don’t fix it,” he stressed. “I really want to take out partnership to new heights. I think there’s an opportunity to take it to new levels.”
Scannell said that the channel organization and business has been doing extremely well, so the last thing he was going to do was come in and try and change the world.
“What I would say the partners should come to expect is simplicity in our model, and consistency” Scannell indicated. “What do I mean by that? If you think about the changes that we announced last quarter, it was really about our Go-to-Market. Before, we had two segments. We had an Enterprise segment and a Commercial segment. And then if you think about it by theatre, we had five different theatres around the world. So if I’m a channel partner, I have to deal with different country managers, different theatre managers, different segment managers in each of those regions. By organizing the way we are, we are going to organize under one leader, so in every country there is going to be one leader. Now yes, we will segment within regions, within countries, within theatres, so we will organize around our customers and how our partners go to market, but this should really simplify how our partners work with us and offer a much greater degree of consistency in who they deal with, and how they deal with us in the field.”
By doing this, taking the simplicity and eliminating the complexity, it equals scale, and should allow both Dell and Dell partners to scale their mutual businesses and grow much faster than the market, Scannell stressed.
“The Go-To-Market model simplifies the world for our partners and us internally, Mullen added.
Mullen noted momentum in Q3 was already good, with 8% order revenue growth, 9% distribution growth, 11% storage growth, 7% server growth and 52,000 new and reactivated customers. It all added up to the channel bringing in $52 billion over the last year.
Darren Sullivan, SVP, Global Partner Strategy, Programs & Operations, laid out the programmatic focus for 2020.
“There are three main focus areas,” he said. “One is increased opportunity and profitability for new customers in Line of Business acquisition. Second is a simplified structure, making it more predictable and easier to manage your Dell business, and third is an improved end-to-end experience accelerating time to get to a winning price.
The first point is all about the expansion of the Dell Partner Preferred program to add server incents.
“We are investing in new business acquisition with you, expanding our Partner Preferred program by adding new target customers for server acquisition to the existing storage accounts,” Sullivan emphasized. “We’ve seen great momentum with this program driven by the collaboration with Dell Technologies core sales and you our partners. The combined Go-to-Market structure should make this easier and more effective.”
Sullivan also told partners that in addition to back end discounts, there will be incremental discounting on the front end.
“When you receive Deal registration approval for server or storage opportunities with an applicable Partner Preferred account, you will receive an increased discount,” he said. “This allows you to price with greater profitability.”
Sullivan also indicated Dell is continuing the New Business Incentive as a reward for bringing in new customers and new lines of business to Dell, and continuing the Competitive Swap Rebate for accounts not on the named NBI list.
The program structure is also being simplified in response to partner requests.
“You asked for more predictability and less administrative efforts, so we are consolidating our product rebate structure from seven lines of business and two or three subcategories within each line of business, to three Line of Business categories – Client Server and Storage,” Sullivan said. “We also introduced base rebate multipliers on focused products to reward targeted behavior.”
Sullivan also stressed that rebate attainment is being made much more predictable.
“Starting in Q1, we will be eliminating the quarterly target process as well as increasing program automation to make your in-quarter earnings easier to forecast, and reduce the number of adjustments required after quarter-end,” he said.
End-to-end experience will also be improved with the delivery of an integrated quoting platform that will build on the Solutions Quoting platform.
“It will provide integrated quoting for the storage, server and networking portfolio this year,” Sullivan said. “Aligning on one platform unlocks a lot of capabilities, including more predictability in pricing with deal registration, by providing additional price negotiation through solution configuration, and by streamlining online experience and allowing self-serve more often.”
These improvements will continue to raise the bar in ensuring a simple predictable and profitable partner program, Sullivan concluded.
Jay Snyder SVP, Global Alliances, noted that more Dell sales reps leverage Global Alliances than ever before.
“Five years ago, it was 7%, and now it’s 30% and climbing,” he said. The goal for 2020 is to get the number of sales teams leveraging alliances in 2020 closer to 50%.
“We used to focus on health care, energy and video surveillance,” he said “We have added retail and entertainment, and are in the process of standing up financial services.”
Snyder also announced some modifications to the Cloud Service Provider Track for partners who work in smaller markets to provide more attainable tier requirements. Rebate accelerators have also been changed. Most have been removed, since Snyder said that they weren’t materially changing outcomes, but there is a new 2x accelerator on VXRail for CSB partners. Benefits have also been expanded for sellout compensation for authorized CSBs, to increase collaboration and diminish competition.
“We have also simplified the POS report requirement, so instead of monthly partner report, we will ask them to verify information we provide,” Snyder said.
Gregg Ambulos, Senior Vice President, North America Channel Sales, then walked through the regional keys to successes for the year ahead.
“The great news is the key priorities and initiatives will remain the same – growth across client server and storage, be easier to conduct business, win net-new customers, and drive tighter alignment with VMware,” he said. New resources are being added to drive this VMware alignment.
“We are transitioning to a region-based model with a territory-based Go-to-Market, to increase alignment with Dell sales and technical teams,” Ambulos indicated.
He stressed the importance of the integration of servers into the Partner Preferred accounts.
“We’ve identified 500 accounts we are looking for all you to penetrate,” he said. “When you establish the Dell server footprint, you get Partner of Record status, and are eligible for base rebates regardless of sales price, which is stackable with NBI, and increased discounts with Deal Registration.”