IBM announced last week in Australia plans to roll out PartnerWorld, a channel strategy that aims to transform its 45,000 global partners into a well-oiled e-business machine over the next two years.
IBM is simplifying its 50 existing partner programs, claiming they are displaced geographically and categorically, damaging IBM's ability to deliver Internet products and solutions to its partners and customers.
"Of our revenue last year, about $20 billion of it was derived from e-commerce. And our partners contributed 34 per cent to our overall revenue. PartnerWorld is a sign of our commitment and investment in helping our partners further contribute to emerging business opportunities," claimed Kathleen Bailey, IBM's managing director, distribution channel, ANZ.
Bailey is adamant that this is not a channel rationalisation, rather it is a "marketing and enabling program designed specifically to help partners participate in e-business and also to help them deliver IBM products". To this end, Bailey insists that existing partners will be given every opportunity to realign themselves under the new structure. "A lot of this change has been driven by our partners wanting to help their customers move from legacy systems into new e-business options." There will also be "more initiatives to encourage new partners", according to Bailey.
David Colvin, managing director of Software Spectrum, is confident that his company is safe, regardless of IBM's partner criteria, because of its international links. But he stresses that some partners might find the global nature of the program overwhelming. "People aren't looking at rolling products out on a domestic basis any more and partners need to be aware of that. And some programs in PartnerWorld won't fit the Australian scene.
"The size of the market here might also mean that we don't get some of the resources other areas will, but overall a more coordinated approach will benefit everyone," Colvin said.
Stuart Charlton, manager of sales and marketing at Sydney reseller Time-Link, agreed, adding the simple fact that "IBM has so many business partners that if it removed them it wouldn't have a business. Instead it is focused on making the most out of its partners."
According to Bailey, the universal program will unite the previously disparate service, software, and PC partners under one simplified banner. "PartnerWorld will instead be divided into four tracks: system and services, software, personal systems, and solution developments. Partners can choose which track they wish to apply for and will then be judged on the four c's: customer satisfaction, competency, commitment and contribution," Bailey explained.
Resellers in Australia appear to welcome the changes, at this stage perceiving the simplification as a benefit rather than a threat. "IBM is getting a lot more focused on its partners and is looking to instil more accountability into the process. This means more information can be exchanged and partners in Australia can get more international exposure," Colvin said.
IBM is anticipating that PartnerWorld will move the vendor away from its traditional product base and into what Bailey describes as "a program designed around solutions, particularly e-business offerings. PartnerWorld will allow partners to deliver standard solutions across all brands."
Charlton believes IBM has been moving towards this for the past two years. "IBM has moved away from the Dell and Gateway model, which is basically what a big traditional reseller would have been defined as two years ago, and into a more service-orientated approach.
"PartnerWorld allows it to concentrate on being a manufacturer and bring products to market, relying on resellers to perform the additional services that all customers want."
Partners will be sorted into three tiers: members, advanced members, and premier members, depending on their aptitude in each of the four c's. "At the member level a partner has sales and marketing information delivered electronically, they get self-help support through IBM's Web portal and they can enhance their skills and education through seminars and training.
"In addition to this the advanced level offers enhanced leads and you earn the entitlement to use IBM's brand and participate in cooperative marketing programs. You get training, technical support and software to use internally.
"The premier level gives you all this plus priority leads and market plan development assistance, all with the goal of helping partners take on solution portfolios," Bailey said.
PartnerWorld will revolve around a common technology infrastructure that supports IBM's online portal through which partners can access "enhanced information and support", according to Bailey.