Dell Revamps Channel to Give Partners More Incentives, Opportunities

New Dell channel chief Cheryl Cook

New channel chief

Dell Inc. is evolving its channel strategy and operations to incent direct sales to work with partners and give solution providers more opportunity to sell free of conflict. To seed channel growth, Dell is turning over 200,000 previously direct accounts to the channel.

The sweeping channel program changes were announced this week at Dell World, the annual gathering of Dell customers and partners. It comes as Dell is looking to shed costs and increase sales to return to growth mode and service its $24.5 billion buyout debt.

Under the program changes, Dell is merging its channel and direct sales operations, tearing down walls and incenting salespeople to work with partners. Dell salespeople will receive 20 percent compensation on deals in seven key solutions areas in which they work with partners.

Dell partners — now numbering more than 143,000 worldwide — will have added opportunity to expand their Dell sales and revenue with incentives, support, access to more products, and free or low-cost demonstration units.

To facilitate partner growth and reduce conflict, Dell is expanding its program, enabling solution providers to identify and close more opportunities within the Dell portfolio.

“Actions speak louder than words, so we are making a significant monetary investment to make it easier for partners to work with us and to encourage Dell sales representatives to partner with the channel like never before. Dell is doubling down on training, product and incentives that give our partners greater economic value than competitors, and make it easier to collaborate with Dell to bring more innovative IT solutions to more customers around the world,” said Cook.

The changes are slated to take effect Feb. 1, 2014, in North America and extend other regions over the year.

The channel changes come as Dell continues to transition to private ownership. With investment partners, CEO took the company off the publicly traded market through a $24.5 billion leverage buyout. Recently, Dell implemented a force reduction program in which it’s rewarding certain employees to voluntarily leave their jobs.

The changes in channel structure and philosophy are more than just giving partners incentives to succeed; they are expanding and extending Dell’s sales capacity without increasing fixed costs. In some regards, Dell is shedding the last vestiges of its direct-sales legacy.

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