When Dell acquired SonicWALL almost three years ago, most SonicWALL partners were concerned, to put it mildly. While SonicWALL had a 100 per cent channel model and did not compete against partners, Dell’s direct legacy made them a likely competitor. Dell had embarked on a coherent partner strategy by this time, but there were still some bumps on the road. Many SonicWALL partners were also smaller SMB-focused companies serving the small business market – at a time when Dell was actively expanding well beyond its own SMB roots with a determined drive into the enterprise. Indeed, the acquisition of SonicWALL and formation of the Dell Software Group was a key part of that enterprise strategy.
So have these concerns been addressed? In discussions with partners and listening to others in Q&A sessions, it is clear that many issues remain, particularly when publicly raised complaints draw cheers from the partner audience. Given that partners attending the Dell Security Peak Performance event are Dell’s best SonicWALL partners, as opposed to a random gathering of the curious as well as the committed, the persistence of these issues is not a good thing. On the other hand, Dell seemed well aware of them, and has been trying to remedy them.
Many smaller partners who serve the micro-market of below 100 employees expressed concern where they fit in, as they were clearly more comfortable working a small market as part of a smaller company like SonicWALL, than a larger company like Dell. One partner from New Mexico – where 99 per cent of the market is the micro market of under 100 users – emphasized that Dell needs to build an SMB product line with a simple set of SKUs for the micro market.
Marvin Blough, executive director of worldwide channels and alliances, Dell Software, acknowledged that those concerns exist, and agreed the way Dell can best address them is by designing cutting edge product for smaller customers.
“The place you really demonstrate that commitment is in the products, with new product designed for small customers,” Blough said. He said that partners will see this early in the new year, when the SMB-focused TZ line will get a facelift that will see a major technological upgrade.
“I love the mom and pop businesses,” said Matt Medeiros, VP and GM, Security Products, Dell Software Group. “They built my original business at SonicWALL and I will always have a place close to my heart for them. The technology in our new SMB product coming out early next year is as advanced as our [enterprise] SuperMassive, which will be a competitive advantage for them in their markets, but they will have to learn that technology.”
One noticeable thing at the Peak event was that many of these high-performing partners are small shops of under five people. Some are one-person operations. That’s not a common trend among the successful today in the IT industry overall, but the hot nature of the network security market, plus the move of many of these partners into managed security services, means that a small SonicWALL practice can be very profitable. Cheryl Cook, VP, Dell Global Channels & Alliances, said that even though Dell encourages partners to expand their practices, both to other Dell security solutions and to other parts of the Dell portfolio, they also recognize that many of these focused SonicWALL partners are highly productive, and have no real desire to change their business model. Accordingly, Dell just added a new competency which will make it much easier for these partners to advance in Dell’s PartnerDirect program, and reap the benefits from that.
“We want to ensure we offer a path to the highest level of status and incentives through the partners’ preferred business model,” Cook said. “We just introduced an advanced competency in network security to help them get to Premier status, so now they can get there with just networking. We will continue to tailor and modify our programs to reward that expertise, because the more specialized the partners are, the more useful they are to the end customer.”
Partners have often complained that the Dell Premier partner site is too slow and has too many errors, but In one of the keynote Q&As, a partner complained bitterly – to significant applause by other partners – that the site has even more serious issues because the pricing is worse than on publicly accessible Dell sites. Consequently, the partner said his customer can get better pricing going direct to Dell, and worse, that he looked foolish in front of the customer as a result of the process.
Cook said a key question here is whether the partner registered his deal.
“Our deal registration process is designed to promote price coherency, and tries to make this kind of thing not happen,” she said. “Deal registration is designed to catch pricing concerns and issues.”
Dave Hansen, Global VP and GM, Dell Software Sales, who only joined Dell three months ago, acknowledged the partner site needed improvement.
“We are redesigning the website to give better access for partners,” Hansen said. “We have gotten better but we need to get incrementally better relatively quick.”
“It’s a big job, but we aren’t starting at zero,” Cook said. “A lot of the work is already underway.”
The deal registration process was also a concern to some partners, because it takes longer for approval than some competitors. One partner who sold a competitive product indicated that because deal approval from the competitor was faster, that could sometimes make a difference in what product he sells.
Blough said that on this issue, length was all relative.
“We have gone from 3-4 days for approval to less than 48 hours at this point,” he said. “Dell is extremely diligent in vetting that deal registration to make sure no other partner has it registered and that it is not in competition with the direct team.”
Partners also complained that the frequent turnover among Dell reps who work with the partners is problematic, as it was very frustrating dealing with a new person every six months.
Medeiros acknowledged this had been a problem, but thought that some of it was specifically related to the broader issues involving Dell over the last couple of years.
“A year and a half of uncertainty over going private clearly caused a lot of attrition, and we also had a lot of new people coming onboard from acquisitions,” he said. “It’s all about stability now.”
Hansen also said that Dell is actively working to keep this from becoming a future issue, and that right now, his attrition rates are below industry average.
“There has been a lot of account change, and I’m trying to minimize that,” he said. “Bill Rodrigues [President of Dell North America and Global 500 Sales] is committed to minimizing account flipping in software. We don’t want to be doing that at all.”
Wait times for Dell support were also an issue of concern, something Madeiros said Dell had identified as a problem and taken measures to resolve.
“Wait times were extensive, and we put substantial effort into understanding why,” he said. “We found we got too many new customers and were over capacity in support. We also didn’t onboard new people at adequate levels of training, so calls were too long. The result was we had 25 minute wait times, which was unacceptable.”
Madeiros said that after changes were made, by last week call hold times had declined to just under two minutes.
“We also established a call centre just for partners, and now a lot of those calls don’t go to Bangalore, but right to Phoenix,” Madeiros said.
Finally, while Dell made a major channel-friendly move earlier this year in adjusting direct sales compensation to encourage their inside team to bring partners in on deals, and has followed that up with management to discourage internal reps from going it alone, neither Dell nor most partners expected an immediate reversal of behavior. One partner said he understood that change is hard, especially in large companies, and that turning policies on a dime is much easier in a company of 50 people than a 100,000 person company like Dell. The partner said he thought the changes were fully accepted down to middle management, but the end user account rep is ultimately the one who has to make the change, and some don’t like to give up control.
“I knew it wouldn’t be flash overnight,” channel chief Cook acknowledged. “But after two fiscal quarters, our early results have been very encouraging. The comp accelerator drove 4300 new customers to Dell. You don’t want to whipsaw incentive plans, because reps need to know what they can count on, and we are going to continue this policy.”
Blough said that Dell is not tolerating direct sales people flouting the new rules.
“There is quick action when there is violation of deal registration and rules of engagement,” he said. “Some people embrace change, while others take a longer time to accept it, and others resist it. However, to sell end-to-end solutions, Dell needs the assistance of partners, so we are committed to this.”