A Whole Lot of Changes at Dell

He called it a program! Wow, that’s a change. Greg Davis, vice president and general manager of Dell’s Americas Channels Group, told me last year at the Ziff Davis Enterprise Channel Summit in Chicago, “We’re not creating a program. We’re creating a value proposition for solution providers that want to engage with Dell, and some elements to the engagement structure.” At least that’s how I remember it. Well, at another Channel Summit in February, this time in Dallas, I heard Davis refer to Dell’s PartnerDirect as a “program.” In fact, in his keynote, he said the word “program” many times. He mentioned Dell is engaging about 30,000 solution providers worldwide and that with the acquisition of EqualLogic, Dell believes it will have a strong program to engage and empower partners.

This isn’t the only change in Davis and Dell we’ve seen in the last six months. Dell also launched a partner portal that includes marketing tools, financing and ordering capabilities, a managed services training path, and deal registration. But what really turned my head during Davis’ keynote was when he mentioned Dell will be compensation-neutral with the direct-sales team in 2008.

My jaw nearly dropped as he explained sales representatives will make as much through a partner as they would selling direct. Now that’s a big change. We see companies here in The Valley that have been working with partners for years, producing upward of 25 percent of the overall company revenue through partners that don’t have a compensation-neutral program.

Dell’s come a long way in the terms it uses to talk about partnering, but the vendor has a long way to go before it embraces the channel, if that ever happens. For one thing, Dell must stop thinking about the channel as a customer and start treating it as a partner. Responding to a question about driving loyalty with solution providers, Davis said, “I wouldn’t give a quota to a customer.” The more-successful channel vendors embrace solution providers, treating them like an extension of their sales, marketing and support organizations.

Dell also has some work to do on its managed services message. Considering the vendor bought Silver­back and Everdream, no one is surprised Dell is building a managed services offering. Davis confirmed in no uncertain terms Dell will sell managed services directly. Still fuzzy is how Dell will pull the Silverback and Everdream teams together to build a managed services program to support the 182 managed services providers already engaged with Dell. Hmm, how do you balance that with your direct managed services model?

Certainly, changing a machine as huge as Dell, steeped in such a direct culture, has to feel like an uphill battle. Davis has done an admirable job—he got a compensation-neutral plan in place within six months. It will be interesting to see how some of the new channel management blood mixes with the old Dell direct team.

Bob Skelley and the EqualLogic team will be a pro-partner boost. Another will be that longtime channel executive Donna Troy has landed at Dell. Troy, most recently the executive vice president of global SME channels at SAP, is a channel champion and will add an interesting mix to the Dell culture. We look forward to watching what results from the changes to Dell’s channel management, partners and the “program.” 

Diane Krakora is president and CEO of Amazon Consulting. She can be reached at dkrakora@amazonconsulting.com.