HP’s Services Enablement Strategy Proves To Be The Keystone In Creating Its “Franchise” Partner Of The Future

April 19, 2011 at 1:24 pm Leave a comment

Beth Vanni, Vice President

As the world’s largest technology company, HP continues to enjoy strong growth and market share gains in most product segments. New CEO Leo Apotheker is emphatic in his vision of how HP will leverage the broadest portfolio in the marketplace and its global brand presence to drive this growth into the future through its integrated ‘Everybody on” and ‘converged infrastructure’ customer promises.

As the company strives to be more integrated with its OneHP vision and cross-product go-to-market strategy, how do HP’s partners fit into the mix? By becoming specialists and focusing on technical competencies. At HP’s Americas Partner Conference last month, Apotheker unveiled a strategy focused on three core areas of the portfolio: Cloud, Connectivity and Software. Pointing to a large total addressable market (TAM ) opportunity in all of these product segments, the company hopes to entice partner investment in more than just its hardware.

VP and General Manager Stephen DiFranco highlighted key 2010 accomplishments that are working to drive this push, such as streamlining and automating systems for HP’s channel business, while highlighting the profitability and document high-growth benefits being realized by “franchise” partners selling across the company’s massive portfolio.

An actionable cross-product strategy is going to be a challenge for the IT giant as it strives to create further specialized competency among its thousands of channel partners. With software such an important component to HP’s cross-brand solutions, it is telling that only 12% of HP channel partners have ever sold a piece of HP software.  But with pressure on one end from customers who are embracing new technologies such as hybrid public/private cloud solutions, combined with HP initiatives such as its Cloud Enablement Program and global PartnerONE framework on the other, partners realize they must transition to broader skill sets in order to stand out from the crowd.

With the exception of its most advanced Elite partners, HP has a long history of engaging its partners in a fairly limited role as sales agents when it comes to professional services delivery.  This is counter to the company’s strategy to develop technology specialists who have the ability to service the customer from early pre-sales assessments and architecture through to post-sale integration.  This is especially true as the company rolls out its cloud-facing portfolio and services offerings pointed at private and hybrid cloud solutions.   As evidenced at this year’s Americas Partner Conference, however, the company is planting seeds to expand its existing co-delivery and delivery enablement programs within the Technology Services group for implementation sometime over the next 12 months.   There are also rumors of clarified rules of engagement around professional services and perhaps even reorganization, designed at supporting a more partner-led services model ….. or at least more a partner-teamed services model which would engage a broader set of their traditional hardware resellers.

HP has proven its ability repeatedly to execute flawlessly when it wants to and apply its massive resources to specific dimensions of its partnering strategy (remember the infamous “hard deck”?)   We look forward to further details on its technology services channel engagement models and its ability to share its considerable services IP with its partners – a model we think will give it a definitive edge over Oracle/Sun, Dell and IBM over the long-haul.

You can read the full event analysis here.

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