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IN THE HOT SEAT: Playing with a straight bat

IN THE HOT SEAT: Playing with a straight bat

With a professional cricket background and an engineering gig to his credit — performing hydrology flood map designs for the water resources commission — Michael Yell entered the world of IT once he decided he had better get a real job. Now with 18 years under his belt at Fujitsu Australia, Yell is concentrating on expanding the server business, which was presented to the external channel two-and-a-half years ago. With the ongoing merger of DMR (which brings software consultancy to the table) and the subsequent changing face of Fujitsu, Yell has moved from general manager to the national channels manager seat. “Essentially it’s the same role as the MD, but with a bigger paycheque,” he said.

What is your role as national channels manager?

Michael Yell (MY): I look after the channel structure in the form of product marketing management, while still carrying sales quotas. We go do everything from designing and developing microelectronics to high-end Intel-based servers (x86). I run the sales, marketing and engineering teams, along with customer support.

What product ranges are you responsible for?

MY: With the microelectronics, we bring in the products from our factory out of Singapore. We can either design a micro control unit (MCU) or application specific integrated circuit (ASIC) for our clients or we can pick standard configurations and adjust those for clients.

Clients can use our products and then incorporate them into the next product they’re developing ... We might not be on the outside, but we’re definitely on the inside — and that’s a very good description of Fujitsu as our products tend to be incorporated in other people’s products. Fujitsu is a manufacturing company, not so much a marketing company.

The other products under my control are printers, scanners, hard drives and displays. I bring those in from the factory and supply out through our internal and external channel.

Where do resellers fit in with the company’s overall product strategy?

MY: One of the things we changed was slotting our customers into a particular segment of the marketplace. Nine years ago, we defined our customers by their strengths, and stopped customers having access to all products. By controlling the customers you deal with, you get a neater channel structure. For some of our competitors this is fairly new, but we’ve been controlling our channels for some time.

We stopped customers who weren’t in the scanner market, for example, going off and trying to buy a scanner directly and then cutting the price and screwing the margin for everybody.

What are some of your channel strategies for 2004?

MY: It varies according to products. For the server range, the objective is to target the resellers who handle the SMB marketplace. With our late entry into the server market, we’re going to have the best impact because we’re not trying to break down some large company infrastructure based around IBM or HP and the relationships that have been established over the years with that vendor. So we believe the resellers out there have a unique or strong partnerships/relationships with many of the customers in key verticals and we want to piggyback on their strengths in their relationships with their customers.

With the hard drive strategy, we deal through three distributors (TodayTech, Tech Pacific and ACA Pacific), and directly with nine local OEMs.

We’re looking for more local OEM development — the whitebox notebook market is growing, for example — and we’re expecting greater competition from Seagate, Samsung and Hitachi.

The big issue for storage is how to handle the heat and power consumption. I think Fujitsu leads in this area with the dynamic bearings, and the durability to produce a good quality, reliable product despite all of the negative press we’ve had over the last year.

Given the negative press — including a class action lawsuit slapped on the company alleging faulty hard drives — how has Fujitsu dealt with the blows?

MY: Right from the beginning we informed our customers of the potential issues because we monitor our failure rates ourselves. And we were monitoring a slight increase in that particular model. I then went and saw some of our major customers and informed them early on there was a slight increase, but we were monitoring it and would keep them up to date.

We had one or two customers who were getting concerned. When we were aware there was a problem, we went to see those customers and talked them through the process of how we would support them. We released marketing bulletins with the latest information from the factories. In some cases, the sales team visited them. We were managing the situation as best we could. When the factory acknowledged it was a third-party chip supplied to them and it was a contamination of the fire retardant on that chip that caused the problem, we then asked our clients to inform us of any customer or end-user that they were concerned about and we would replace the product. To show good faith, we were also swapping products out to customers with a higher capacity.


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