IN THE HOT SEAT: Time for a change

Each week in ARN, we interview a leading personality from some of the world’s most influential hardware and software vendors. This week, IBM Software’s acting general manager for Australia and New Zealand, Duncan Hewitt, sits down with Brett Winterford.

What does the IBM Software group look like after its recent restructuring?

Duncan Hewitt (DH): The IBM software group has made several changes to the way we do business. Before January 1, our business was based on our five key brands — Lotus, Tivoli, Websphere, DB2 and Rational. We have restructured the business so that it can be based on solutions. The business is organised around customer needs, not on brands.

Why was there a need for this change?

DH: Customers would come to us and they want to solve a problem. They would come to IBM and say for example, that they needed a content management solution. A content management solution is something that requires technology from several of our brands — be it Lotus or DB2 or WebSphere. It is also highly common that such a solution would require software components from more than one of our brands.

Has the restructuring been a big change for IBM software internally? Have staff been redeployed or made redundant?

DH: The transformation is a significant shift away from our previous brand focus. While we had several people in ‘solution selling’ roles previously, we have given them an even deeper and broader focus on solutions, industries and channels. While the transformation has had no impact on the number of Software Group staff we have in Australia, there has been an evolution of staff roles and responsibilities.

How about for partners — is there an education process they need to be taken through?

DH: We have already briefed the majority of our partners on the changes at local events as well as at PartnerWorld recently held in Las Vegas — IBM flew our whole team and every software team across the globe to Las Vegas for training. We will continue providing additional information on the transformation at the IBM PartnerMeet event in many cities across Australia and New Zealand in April and May.

What are some examples of solution sells IBM will focus on?

DH: Things such as automation, integration, business intelligence, portal technology, content management, development tools, Linux solutions, security and storage.

What vertical markets is IBM software targeting in Australia?

DH: Most are those in which we already have significant expertise. If I had to list some I would say retail, healthcare and telecommunications.

How do the changes affect your relations with reseller partners?

DH: From a partner perspective, we were previously split between three teams — a team that supported the global systems integrators, a team that supported the reseller base, and then a channel team for each of our brands. We have changed that now so that there are only two channel teams for all of IBM Software — one sales team and one partner development team.

What were the drivers behind these specific changes?

DH: We were told by partners during some partner advisory councils we held last year that sales forecasts were a major pain point. Under the new structure we have been able to halve the amount of people that were calling resellers asking them for sales forecasts. Previously resellers were fielding calls from every one of our teams asking for forecasts — now they get one call.

Under the new arrangements, there is also a rep available for all of our partners. There is a dedicated technical support team in place for our partners, an innovations centre and a porting centre where ISVs can come and test their wares. We are giving our business partners a lot more access to technical resources.

Are some reseller partners loyal to a specific brand?

DH: Some partners have built expertise in specific brands and we have brand-dedicated channel resources (business development and technical) to support their needs. I think the transformation will help them better expand their business by leveraging other software brands where it is appropriate.

Do you expect any resistance to the changes?

DH: Our partners have, in fact, welcomed these changes as in many areas they were changes they had requested. They have welcomed the increased technical resources that are available exclusively for the channel.

In total, does it mean more staff or less staff focused on the channel?

DH: There are now more channel-dedicated resources, particularly in the areas of technical sales, where our partners told us they needed more assistance. More technical sales people are available dedicated to Business Partner skills development and project support. Year-on-year, we have 25 per cent more staff.

Do resellers need to retrain or get new certification under the new structure?

DH: The channel programs and the certification programs all remain unchanged.

How do the changes affect IBM Software’s relationship with IBM Global Services?

DH: IBM Software has a very good relationship with IBM Global Services which continues. We are now more closely aligned to the industry sector structure of IBM Global Services and, therefore in a better position to deliver greater value to our joint client base, a very positive result.

How is the channel program tracking?

DH: We had a lot of growth last year — driven mostly by our value-added distributors [VADs]. Revenue through channel partners this year was 10 per cent higher than our overall growth. A big part of that was driven by Avnet, Alstom and Express Data. And we should take some credit too — we have been gradually improving the way we execute with our distribution partners. The feedback from our partners is that we have been a lot more consistent over the past 12 months.