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HP’s Decision to Clearly Define Direct Accounts Wins Points with Partners

For VAR HMP Networks, investing on a customer relationship has been tricky because company executives always feared Hewlett-Packard Co. swoop in and scavenge the account. “That fear was always there,” said Romi Randhawa, president of HPM Networks, of Fremont, Calif. That is because of the vendor’s practice of selling directly to customers, sometimes steering them […]

Written By: John Hazard

Nov 9, 2005

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For VAR HMP Networks, investing on a customer relationship has been tricky because company executives always feared Hewlett-Packard Co. swoop in and scavenge the account.

“That fear was always there,” said Romi Randhawa, president of HPM Networks, of Fremont, Calif. That is because of the vendor’s practice of selling directly to customers, sometimes steering them away from channel partners. “Do we want to apply these resources if it’s just building a customer for the vendor?”

But the fear is gone, said Randhawa and other HP PartnerOne partners, since HP announced this week that it will no longer pursue new customers directly. Instead, the company will sell only to customers on a list of “named accounts,” and any customers that come to them, as part of a new go-to-market strategy that leaves the bulk of customers and all new sales opportunities in the hands of partners, said Tom LaRocca, HP’s vice president of partner development and programs.

Partners contacted declared the defined rules of engagement a monumental change of course for a channel program notorious for competing with clients.

“This wasn’t a tactical decision; this was a strategic maneuver,” said Laurie Benson, CEO of Inacom Information Systems, a Madison, Wis., system integrator and HP reseller. “They’ve been making a lot of announcements about channel programs this year, but most of those were programmatic. This cuts to the core of what the program does.”

Click here to read about HP’s redefined customer engagement rules.

Benson called the changes a foundation on which HP will likely build an impressive channel program to target sales to SMBs (small and midsize businesses).

The new go-to-market strategy, Benson said, should allow partners to leverage resources they never otherwise could have used without fear of losing a client.

“Since nobody is worrying about who is getting the sale now, you can leverage resources jointly, adding a lot of value to the offering,” she said. “Before that you might have thought twice about losing that sale to HP.”

With less obstacles for resellers, the new strategy makes business with HP easier for a new class of partner, said Pete Anderson, president of Bayshore Technologies Inc., a Tampa, Fla., system integrator and primarily a Microsoft Corp. reseller.

“For a lot of customers we are the trusted adviser. We are in their business for software integration, and that drives hardware sales,” Anderson said. “We’ve been recommending HP products for years, but we can do so with more confidence that we have a stake in that now.

“If you want to break into the [SMB] market, that’s where you’re going to find it.”

HP’s Decision to Clearly Define Direct Accounts Wins Points with Partners

John Hazard

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