Brand-Franchise Channel Partnerships: Who Do End-to-End Solutions REALLY Benefit?

April 14, 2011 at 8:13 pm Leave a comment

by Diane Krakora, CEO

At this year’s HP America’s Partner Conference 2011, new CEO Leo Apotheker introduced a newly crystallized set of messaging focused around the ability of HPs broad portfolio to create a “seamless, secure, content-aware experience for an InstantON, connected world.” While certainly admirable, with the proliferation of exceptional products and suppliers from which customers can choose, it begs the question: Who really benefits from the sale of a single company’s end-to-end solution?

HP of course is not the only company trying to focus channel partners on the benefits of delivering a cross-portfolio solution to their customers. It was also top of mind at the recent Cisco Partner Summit, and something that most large IT vendors drive towards. After all, gaining 100% of a channel partner’s customer engagement  is not only profitable, it virtually eliminates the chance a competitor can gain a foothold in the account. But is that what solution providers are looking for?

From the buzz at both conferences, as well as results of our recent channel research, it does not seem to be. Partners are increasingly discontent as merely sales agents for a single vendor, nor do they want to sell against a vendor’s own direct sales force.  With customers looking to channel partners as experts to provide the best of breed technologies to meet their unique needs, it is unrealistic to expect the vast majority of partners to sell single brand solutions other than in deeply entrenched install base customers for the vendor.  Despite the massive portfolios today of companies such as Oracle, IBM, HP, Cisco and Microsoft  it’s in solution providers best long-term interest to take the best products or services each vendor has to offer and package them into a solution that is meaningful to each unique customer. And, it always has been.  Single vendor solutions also imply a high degree of alignment and trust between the vendor and solution provider, which in recent years of an unstable economy and direct-delivered managed and cloud services, is a big risk for small solution providers.

Obviously, breadth of portfolio goes a long way towards ensuring a single source solution that partners can take to market. However, vendors are strongly encouraging technical specialization among their channel partners.  This implies deep and focused technical (and sales and service) skills around a given technology.  Depth vs. breadth.

Are single source solutions for specialized markets truly implementable?  Yes, absolutely.  Especially as the big vendors continue to acquire companies and get bigger.  Every vendor has their marquee solution providers who are unusually loyal, profitable and aligned.  However, until vendors themselves increase the effectiveness of their marketing and sales tools to help build end-user demand for cross-brand solutions and eliminate the remaining vestiges of channel conflict, the “franchise” partner model will likely remain as elusive as it was 15 years ago.

You can read the full HP Americas Partner Conference Event Analysis Here.

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Entry filed under: Industry Perspective, Live from Events. Tags: , , , , , , , , , , , .

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