Hewlett-Packard partners are expecting to hear more about the vendor’s ongoing channel transformation at its HP Americas Partner Conference June 19-21 in Las Vegas.
The company is expected to announce specifics of its remodeled PartnerOne program that were left out of the initial rollout March 27, including margin and compensation rates, partner level requirements and MDF (Market Development Fund) calculators.
The developments are mostly programmatic, but HP is expected to set compensation and program requirements for the new PartnerOne program. Program changes are expected to drive sales of HP’s core product sets as well as printing.
HP is also expected to announce more specifics about its new joint marketing organization built around its “sell more get more” strategy, which was unveiled in March.
The developments are the latest chapter in HP’s channel transformation that began last November when the company introduced “named accounts” and discontinued direct sales that competed with the channel in reaching certain accounts.
HP essentially brokered a deal with the channel, whereby partners can expect more support and investment in return for selling more product, HP executives told Channel Insider.
The November announcements ended HP’s aggressive direct sales to new customers and created compensation schemes for direct sales agents to work with resellers. The March enhancements rewarded partners based on the attach rates of peripherals and add-ons to HP solutions.
“If you’re already selling an HP solution, you have the chance to earn a more lucrative reward by selling a little more HP with it,” said John Thompson, vice president and general manager of HP’s Solution Partners Organization, Americas. Thompson said it could encourage partners to swap HP for a competitor’s product in a solution set or explore a “sister,” or related, competency.
HP executives foresee a scenario in which partners selling a solution such as storage would see a benefit to attaching more HP products in the sale, or to adding complementary solutions, such as blade servers or storage area network components.
Many of the programs, requirements and rewards associated with that new strategy will be revealed at the conference, HP executives said.
HP has been working to improve its relations with channel partners after several years of frustration among partners as the vendor appeared bent on competing with them through its indirect sales for even some of the smallest accounts in the market.
To exacerbate matters, CEO Mark Hurd appeared to intimate last year shortly after he took the company’s helm that the vendor would give preferential treatment to partners who showed their loyalty by favoring the brand at the cost of other vendors. The ill-timed statement frosted partners who already were resentful of HP’s direct efforts.
But HP began mending fences and building new bridges in November, most significantly with the installment of a named accounts policy that made the vendor’s vaunted call center an inbound sales force only. All new leads would be sought solely by partners.
The decision went a long way to appeasing partners, many of whom, like Romi Randhawa, president of HPM Networks, in Fremont, Calif., feared their own partners’ sales forces more than competitors.
“That fear was always there,” said Randhawa. “Do we want to apply resources if it’s just building a customer for the vendor?”
But the fear is gone, said Randhawa and other HP PartnerOne partners. Instead, HP sells 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, Tom LaRocca, HP’s vice president of partner development and programs, told Channel Insider.