Thursday, December 3, 2009

Will the Real Partners Please Stand Up?

I wrote a blog post about a year ago when partners were going crazy around a mistake SonicWALL made ( that caused some pain for folks when their units were not updating and working properly. Over the past 12 months there have been posts around issues at Ingram and ConnectWise. Things happen that cause pain for partners and it seems more and more that the response is to react and start blasting out emails and complaints rather than trying to understand what is happening. The most recent of these involves another great partner of the channel – the folks at HP.

HP has made a corporate decision to take compliance very seriously. They are addressing some legal and regulatory compliance requirements proactively. There is a tendency by many of us in the channel to forget that our vendor partners don’t make the rules under which they have to operate as a corporation – they are dictated to by the government or in the case of many – governments all around the world who seem to focus on making it difficult for large corporations to succeed. HP, and Compaq before them, have been very strong channel advocates. They are not perfect, and have made plenty of bone headed decisions in the past. But the thing about HP that has always impressed me, particularly in the past few years, is that when there is a mistake, particularly in channel conflict, they take the appropriate action and side on behalf of the partner to correct the error. At least that has been my experience and why we have all our eggs in their basket. The same is not true from some other hardware providers who claim to be channel friendly. If there is a conflict, they default against the partner and deliver the “too bad” message. But that is for another day and time.

HP has been tasked with meeting compliance requirements. They have chosen to use an outsourced vendor to handle this process – recognized in the compliance industry as a best in class screening service provider. Using a third party also provides some separation by HP in case there is ever any investigation or question about the process. Partners have received faxes and emails with the message that they need to register on a secure portal, take a short training module, review the code of ethics, and then complete a questionnaire to assess compliance risk. The process is fairly painless. It took us two and a half to three hours. Yes it cost $120 to complete it. There are certainly things about this process that are poorly done:

1. Communication has been very poor – receiving notice of this via fax is a pathetic method – this is the 21st century after all
2. There is plenty of the training that does not apply to an SMB partner – not a big deal but an aggravation
3. There does not seem to be any connection between the communication and whether a partner has done the training – some get notices after completion while others still have not heard about the need to do it at all
4. Communication has been very poor – worth repeating again since it is soooooooo bad

OK – now that we have agreed that the process leaves something to be desired, let’s talk about the other side of the coin. There always are two sides to consider although partners tend to only want to see it their way. HP is setting a standard here. They are going to require partners to be compliant and follow the rules. They are setting a standard around business conduct that should give us some assurances that things will be done properly. In a way, they may be setting themselves up for some unfair competition from competitors who opt not to play so fairly. But bottom line they are making a statement about their desire to be a thought and industry leader and that is a very good thing indeed.

So what is the bottom line. As I see it, HP has a cost of doing business that they are passing on to their partners. They also are taking a proactive stance on being sure partners are compliant. Should we like it? Maybe not, but guess what, that is exactly what I do when I have an increase in my cost of doing business. It gets passed on to my customer. I am willing to bet you do the same, or soon will be out of business. Besides - $120 is an aggravation not an expense to be a partner. You pay $1500 or more to be a Microsoft partner. Many vendors are a lot more than that. Those that truly are HP partners have expressed over and over that this is not a big deal. It is part of being a true partner. Many have expressed the wish that the cost to be an HP partner be significantly higher. Those that are making a big issue of the matter likely aren’t really partners but looking to have access to things without being willing to truly step up and partner. Sitting on the HP small business advisory council allows me to see the reality of their partner channel. Less than 10 percent of their partners sell well over 80 percent of the product. So will there be tears in Houston if a bunch of people who carry the name of HP partner but don’t sell anything decide that spending 3 hours and $120 is too much to ask go away? I wouldn’t be shedding any tears. That is not the intended purpose of this compliance process, but it may well be one of the benefits. And quite honestly, when I have conversations with other HP partners who are invested and understand what it means to truly partner talk about this, they hope the herd is thinned by a significant percentage. Less people to compete with means better things for those who understand that partnership is give and take and requires everyone to work together.

Could it be done better? Absolutely. Is it a real issue? Not from my perspective. We are a very spoiled bunch in the IT VAR channel. They didn’t call and close a bunch of our shops like they did in the auto industry. They are asking for some true partnership and it is time for the real partners to stand up and differentiate yourself from the pack. Time to grow up and get down to the business of talking to customers and selling solutions rather than whining about something that doesn’t matter.


Erik Thorsell said...

Arlin, I couldn't agree more. The word partner, it seems, should imply a two-way relationship with a real sense of commitment. So, when partners have a disagreement, they make a genuine effort to work it out together with empathy for the other.

Too often, I hear VARs describe stories that are genuinely frustrating...but where they seem to be prepared to almost immediately dump the relationship (or maybe worse, to keep it but publicly backstab their 'partner'). How would we feel if our clients did this? I'd find it pretty unprofessional of them.

We have a couple of vendor relationships that seem to have gone south in the last year. I asked my staff to make a genuine and serious effort to work together with the vendor to explain our concerns and make specific requests for help. One appears to be engaging in working on the relationship. The other doesn't. I think it's reasonable and healthy that some partnerships end -- but it's how we work toward (and through) that ending that speaks to our own professionalism and maturity.

Anonymous said...

HP has made several decisions that have affected our clients in this region, including imposing sales requirements for strictly service shops which are unrealistic.

Because these sales were not met, HP closed the authorizations of all the shops that didn't meet the sales quota. In my city alone, there were three authorized centers that you could have an HP product serviced at, and within 120 there were at least 4 others.

Now, there are none. And that includes metro Valdosta Georgia, and even the capital city of Florida, Tallahassee.

Should a client have an HP printer or product fail on them, there is nowhere for them to turn to get it fixed, except to ship it off.

HP quality has drastically declined in the last three years, so the importance of having a local authorized service center is all the more critical, yet nothing has been done. And now, to increase the cost of the relationship that is already waned thin by non-competitive business practices (coming in to do a deal directly snuffing out the partner on large orders) is the last straw.

Your article title is "Will the Real Partners Please Stand Up" is an excellent beginning, but not enough focus is placed on the "bigger end" of the partner to also step up.

I'm not a fan, having been an HP shop for nearly 15 years until recently, and I can tell you that other manufacturers have a much more robust partner program in place, where they genuinely care about their sales and service partners -- and do what they can to keep us alive and in business.

HP has a lot to learn, and to not take legal and regulatory compliance training in-house under the same training platforms as their other required partner classes is ridiculous. Count me out... I'm with someone who loves having me now.