CA Names Names: The Good, the Bad and the UglyBy Elliot Markowitz | Posted 2005-04-07 Email Print
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Opinion: CA's new grand plan for the channel may work, but the company will have to take extra care it doesn't create conflict with partners.Computer Associates has unleashed a grand channel plan, in the midst of a complete reorganization, that will effectively give the company's direct sales force preferred access to more than 12,000 corporate accounts. I'm here to tell you the good, the bad and ugly parts of this strategy; and believe you me, there is plenty of all three to go around.
Naming preferred accounts is a double-edged sword in my book. I would be the first person to agree that whenever there is an entrenched direct sales force in place, rules of engagement must be established and they need to be clear, with no gray areas, or it will result in confusion. And confusion results in lost business, for the vendor and for the channel.
Who takes the lead on specific accounts, who is the direct point of customer contact and exactly what role a vendor sales representative plays, along with the services offered by a channel partner, are critical to ensure the success of a project and the ultimate satisfaction of any given customer. If a VAR feels he is competing for business inside an account with a vendor that he/she is representing, that VAR will eventually push another supplier's wares.
There is a lot of good involved with CA naming preferred customer names as long as there are set rules for engaging and servicing those customers. Clarity wins over confusion any day of the week. CA should be applauded for trying to narrow the gray area between its channel partners and its direct sales force.
We know CA is marketing the move as a way to drive more sales, not less, through its channel partners. The company is openly admitting it cannot service all the requirements of corporate accounts and needs to bring in VAR partners to fill in the service gaps. My understanding is that CA's direct sales folks are going to be compensated handsomely for bringing in channel partners. This is certainly good.
It is no industry secret that CA has publicly said in past years it wants a greater mix of its business to come through the channel. Right now, sources tell me that number is south of 20 percent and it needs to grow significantly.
But I am not sure this is the right vehicle to get them there. Mixing direct sales reps with channel partners could be a dicey proposition. VARs are always suspicious of direct sales reps, and for good reason. I have rarely met a VAR that didn't claim to lose some piece of business to a vendor's sales force at some point. Suspicion is bad. However, if the incentives hold true, this could be a very good deal for the channel.
Another bone of contention is that CA's partners can solicit the named accounts, as long as it is with the company's direct sales force. No VAR I know likes to be handcuffed. CA says it simply has informed its channel partners that if they engage a named account they can expect to find CA direct team there. I am not sure how this communication between the two works out, but it appears it is going to take another step to organize and coordinate, which can cause scheduling and political headaches. Again, if the channel starts to see real service leads come its way, it will get over this point in a hurry.
Also, we are talking about 12,278 named accounts. That is a pretty big preferred customer list for VARs to swallow. CA may say it's not. But for the solution-oriented VAR, being told to stay away from being the lead on 12,000-plus account is a big pill. Big pills are bad.
As for the ugly, I'll leave that to the Mets season opener loss to the Reds. What this has to do with CA is that the best-laid plans of mice and men, often and you know the rest. We will see how this works out for both the channel and CA eventually. It certainly has the potential to be far more good than bad. Let's hope it doesn't get ugly.
Elliot Markowitz is Editor-at-Large for Channel Insider. He is also Editorial Director of eSeminars for Ziff Davis. He can be reached at Elliot_Markowitz@ziffdavis.com.