The Tricky Move to Services from Product Sales

By Jennifer Lawinski  |  Print this article Print

Siemens Enterprise Communications channel chief Patrick Kehoe says he has fixed the bugs in the company's channel program and is going after market share from companies like Cisco and Nortel.


The Tricky Move from Product to Service Sales

For Siemens, Kehoe said the value proposition to partners isn't reselling their cloud, it's in providing services to customers long-term.  "If you just view it from a partner perspective as reselling a hosted Siemens cloud solution, the value proposition is rather narrow… our view is very different. It has that broader perspective and I think where we're getting traction with partners is that we see that trend and they see what we can provide them," he said.

"Ultimately we are pushing to take advantage of our full suite of service elements and offer them to partners in a complimentary way – managed services, backup and recovery, networking monitoring… to the extent that it's aligned with their business model."

Whether channel partners go full steam ahead with the cloud and services solutions, or if they take a slower approach to change, Kehoe said partners who specialize will likely be more successful long term.

"We're moving to a model where there is significant consolidation in the channel and larger and larger players…but with that we also see core specializations. At the end of the day either from a vertical perspective or from a particular niche set of infrastructure solutions, the one who have the depth and experience and competency are really going to so," he said.

Siemens put its training and certification materials online in the past year, for free, and continues to push the company's business development and marketing assistance to the channel because it knows it's coming from behind in the market. "In the North American market we don't garner the same brand awareness and natural consideration in purchase cycles. We're very much engaged in a push-through-the-channel model," Kehoe said.

"We are trying to engender a sense of shared interested in one another's business to develop a sense of sustainable growth," Howard said, and new partners "see us as being a real alternative."

Siemens recently signed a distribution agreement with Ingram Micro and partnered with Verizon Business; the company had existing relationships with Arrow Electronics Solutions and BlackBox.

As Siemens moves into 2012, Kehoe said the company needs to refine its services business model. "We will find the right engagement model with the partner related to those services so that they truly are positioned as the core provider, which may of them are looking to do, as opposed to some hybrid model where the vendor owns part of it," he said. "Ultimately we feel that it will serve us and our channel community best if we can enable the partner to lead those relationships, and we can lead them from behind."