3 min read

HP promises partners less throat choking after reorganization

Hewlett-Packard executives were out in force at Varnex to discuss merging the printer and PC businesses and plowing the savings into R&D

NEW ORLEANS — Hewlett Packard Co. (NYSE: HPQ) channel chiefs took the opportunity at distributor Synnex Corp.‘s Varnex Spring Conference to lay out some plans for their partners and address one big elephant in the room.

With the recent announcement that HP’s personal systems group and imaging and printing group would merge, the executives told partners that they’re confident in the direction that CEO Meg Whitman has laid out. “This is the most impressed with an executive I’ve ever been,” said Scott Dunsire, the company’s vice-president and general manager for IPG commercial sales.

“What we’re looking for is synergy,” in terms of how HP will structure its teams, he said. There are currently more than 1,000 vice-presidents worldwide at HP, and many resellers have several business representatives to deal with.

A small reseller in a small city may not need or want four different HP business managers, while larger solution providers may prefer the distinction among representatives. Typically, resellers do want one throat to choke, but finding the right balance is the current challenge, he said. It’s not easy and it may not make everyone happy, he said. HP will announce how those teams will be structured in May, with the structural changes being made soon after.

“I’m hoping it’s more streamlined,” said Tom Rand, an account manager with Cornwall, Ont.-based Jtec Distribution Inc.. “I think the central point of contact is going to be critical.” For smaller resellers like his company, the “one throat to choke” concept is going to be important, especially having reps with a local focus.

“I don’t think they honestly know a lot of the details yet internally,” added Mike Fritzler, a partner at Regina’s Fact Computers. “I’m really hoping that by merging the divisions they’re not going to start losing some people,” he said.

Still, the idea of a more streamlined relationship with HP did resonate with Fritzler, who has about eight HP sales contacts that he deals with weekly. While he doesn’t want to lose any of those people, he said he also understands the confusion that often comes with being an HP partner.

“I’ve been through so many reincarnations that I understand their thought process,” said the 22-year HP partner. But newer partners may not understand how to work with HP the same way he does.

Having too many reps to deal with has been a complaint, said Bob Stegner, senior vice-president of marketing for North America at Synnex. “I think the timing is better on it now,” he said of the PSG/IPG merger, since today most people don’t buy only a computer or only a printer. The merger will make bundling solutions easier for HP and its partners as well.

HP focused on R&D, mobility in coming year

The money saved from merging the two groups will be pumped back into research and development initiatives, along with better marketing, said Mike Parrottino, vice-president and general manager for U.S. channel sales and marketing for HP’s PSG. “(The) flavour of innovation that you’re seeing from us is really pragmatic innovation.”

That means really focusing on customer needs and not taking out elements that are still needed, but rather evolving the products. “I think you’ll continue to see HP focus on R&D,” Dunsire added.

Mobility will also be a priority for the company in the coming year. In May, a new wave of notebooks will launch as a follow-up to the company’s Folio 13 ultrabook. And in October, another round of products will launch in conjunction with Windows 8, as well as with ARM architecture.

The biggest opportunity for growth, though, will be economics, said Frank Rauch, vice-president and general manager of HP’s enterprise server, storage and networking (ESSN) channels in the Ameicas.

In its ESSN practice, selling networking products that are 30 to 40 per cent cheaper than competitors will be a major opportunity. Currently, 60 per cent of ESSN business goes through channel partners.

“Face it, we all love hardware,” Rauch said. “There’s nothing wrong with being an infrastructure provider.” But evolving toward the cloud, services and software will also be a major part of the vendor’s strategy.

Several of the company’s recent acquisitions have been part of that, throughout the entire company, not just ESSN. HP has worked with those acquired companies’ existing channel strategies to bring the most value to its partners, he said.

Synnex’s Varnex Spring Conference wraps-up on Wednesday.

Follow Harmeet Singh on Twitter: @HarmeetCDN.