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Top corporates mixed on channel

Top corporates mixed on channel

The good news is that over 40 per cent of Australia's top 500 companies engage the channel for total solution integration, product installation and provisioning of new technology. The bad news is that as many as two in five large corporates don't use the channel at all.

The statistics come from startling new research commissioned by ARN conducted in conjunction with The Top 500 Corporate Report by research group East & Partners.

According the researcher, 38.3 per cent of large corporates said they do not engage channel partners in their technology procurement policies in any fashion. Paul Dowling, a principal analyst at East & Partners, said that while that figure is alarming there are a number of factors that could explain the result.

Dowling said vendors often sub-contract channel partners into accounts but carefully guard the level of involvement and recognition the partner receives as a result.

"There is little to no transparency for the customer if a partner is sub-contracted by the product principal [the vendor]," said Dowling. "That's where a lot of conflict between the channel and the product principal comes from in terms of who owns the customer account."

East & Partners surveyed 447 respondents of Australia's 500 largest companies excluding the 27 IT&T companies with annual revenues that would place them in the top 500.

While respondents value the channel predominantly for total solution integration, product support and specific consulting skills and resources, 21.9 per cent of corporates engage channel partners for user training.

This bodes well for a number of Australia's larger resellers that have invested in training divisions, which Dowling said are often a significant revenue source.

However, Dowling said the implication derived from the research is that the most important thing to these corporates in dealing with channels is the partner's ability to integrate technology and deliver solutions. While one in five corporates that engage partners do so for user training, its perceived importance is not high.

"What I'd be saying to the channel is stick with training, but don't lead with it. Lead with your ability to provide solutions," he said. "Training often comes after the deal has been won. It's more or less expected as a value-added service."

Next week in Part 2: Corporates say ROI is not being met.


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