Dell Channel Commitment Starts at the Top

By Chris Gonsalves  |  Print this article Print

Dell's PartnerDirect channel program may have disappointed resellers with a few missteps in its first nine months, but overall, solution providers and analysts are giving Dell high marks for listening to partners and working the kinks out of their partner relations. From CEO Michael Dell on down, it's clear Dell is serious about leaving behind its direct-only past and succeeding in the channel world.

The channel advisory board is just one aspect of Dell's partner initiative, according to Davis. The company is also trying to boost its channel credibility by training all of its sales force in the value of the channel; opening new lines of communications with VARs through blogs, forums and other Web 2.0 efforts; and adopting so-called neutral compensation, which gives Dell sales reps the same commission for deals done through resellers that they get for direct sales engagements.

According to Dell officials, 93 percent of the top VARs in North America already buy from Dell. "We've been in the channel in reactive mode for many years," Davis tells Channel Insider. "Now we're being a lot more proactive."

CEO Michael Dell tells Channel Insider that the channel now accounts for some $12 billion, or roughly 20 percent, of the vendor's annual revenues. "We've got 22K [global] partners," says Dell. "That's pretty staggering. And on top of that, we've got the No. 1 brand and some unbelievably great, differentiated products. The brand is well ahead of the other guys in SMB. We've got stuff other guys don't have in the form of EqualLogic. We have a great managed services platform. So there was a latent opportunity here.

"If you look at our history, we had a monolithic strategy that worked quite well until it stopped working," Dell concedes. "So as we reevaluated that, we saw that partners and channel would be a big part of our success. That's exactly what you're starting to witness."

Davis says Dell is making three broad commitments when it comes to the channel. The first is to fill the partner ranks with as many resellers as it can recruit. With 11,500 North American partners already registered, Davis says he's aiming for 200 new resellers a week to meet his goals for the year.


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