Penman confident Compaq can ride out its channel storm

Penman confident Compaq can ride out its channel storm


Despite reporting a 24 per cent increase in sales compared to the same period last year, Compaq Australia officials have confessed to facing integration difficulties as the vendor continues its aggressive growth path.

Most recently, Compaq's distributors and resellers noted serious problems in the area of service and product delivery (ARN, November 11, page 4).

Compaq's vice president and managing director for Australia and New Zealand, Ian Penman, acknowledged the problem, explaining that the implementation of Compaq's new channel-aimed "order-to-fulfilment system" and the parallel introduction of SAP/R3 "have not gone well" due to problems in linking the availability and delivery process information.

"We are overcoming those issues and I think that the problem will be rectified within the next couple of weeks," Penman said.

Once the supply difficulties are over, however, Compaq distributors and resellers will have to face an upcoming distributor reassignment challenge as the vendor attempts to refocus and simplify its channel strategies.

More efficient

"One of the key things to comprehend is that the premium paid in the acquisition of Digital needs to be recaptured and the way to do this is to become more efficient, to lower costs and through finding new ways to grow products and services to capture revenue profit," Greg Healy, Compaq's general manager for business, said.

According to Healy, it is for this reason that Compaq is taking a "fresh approach" to channel organisation that will see the company reassign its direct partners and extend relationships with indirect channel partners in order to address three specific market segments - enterprise, business (with the emphasis on small business) and consumers.

For the channel, however, the next couple of months will bring more uncertainty as it tries to assess the ways in which Compaq intends to "transform itself from a vendor to an IT partner". But for Penman, timing is not an issue.

"What we are trying to do now is to ensure that the right people are in place and the right partners are in place. That includes our distributors, and if that takes a bit longer than the market believes it should take, then that's unfortunate," he said.

Emphasising that the vendor's priority to complete its restructuring program both internally and externally in order to create a "customer-facing organisation where every employee will be responsible for customer satisfaction", Compaq will reassign its distributors during the first quarter next year.

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