MISSISSAUGA, ONT. – Tech Data Americas president Murray Wright was in Canada Thursday to attend the Canadian Tech Data Vendor Summit (Nasdaq: TECD) and meet the high tech press to discuss how the distributor is redefining value-added distribution.
Wright has had a storied the career in the IT industry. A former NHL draft pick, he was at one time the president of Ingram Micro Canada – Tech Data’s long time rival.
He was also the first president of Lenovo Canada shortly after IBM sold off its PC division.
Wright was joined by Tech Data Canada president Rick Reid, and both men believe the future of distribution is in how well and how fast the company can shift to a value-based model.
CDN sat down with Wright and Reid to discuss value-added distribution and other topics.
The following is an edited transcript.
CDN: How does a broadline distributor such as Tech Data redefine value added distribution?
Murray Wright: We’ve been working on this for a while at Tech Data and as a broadline distributor are strengths are pick, pack and ship but going forward that’s not much of a differentiator any more. So the question then becomes, what will you do to differentiate? With the evolution of technology we provide solutions and a great example of this is AIS (Tech Data’s Advanced Infrastructure Solutions division) and our networking business. This has led to an increase in storage and in selling solutions. It’s where we want to be positioned. The market is compressing and the Intel-based server is capturing more marketshare than high-end servers. We think we can provide the total solution with a good business model and lower costs in SGNA (sales and general administration costs). And we’ll provide good value.
Rick Reid: Value comes in many flavours and the shift to value is the point we want to bring home here. We have 30 technicians available to the reseller. That’s a big value-add. Then there’s our configuration centre, which is another big value-add. In the past, resellers felt its was inappropriate to compensate the VAD (value-added distributor) and questioned the price of the value being offered, but now we think it’s a nice combination of value for a broadline distributor.
CDN: You once ran Ingram Micro and one of their major initiatives was Seismic managed services. This was something Tech Data never wanted to do. Now that Seismic has been rolled into its Cloud Marketplace initiative, do you feel that Tech Data made the right move all along?
M.W.: All those scenarios are about making good decisions and watching the market. Today, Tech Data is well positioned to take on the cloud; 90 per cent of the cloud talk has been in the media and about 10 per cent has been about cloud deployment. That’s the trajectory. This takes me back in time to when there were all sorts of prognostications of demise of the distributor as a delivery model for technology. Distributors today offer more value and have positioned themselves in the cloud market. We didn’t want to compete with our reseller customers and so we put cloud out there as an enabler. We can support resellers in any way on how they want to deliver their cloud. It’s been designed to help them with their cloud offerings.
CDN: Are there any differences between working at Ingram Micro and working at Tech Data?
M.W.: Ingram Micro and Tech Data are significantly different and it’s hard to describe. Ingram is a great company. Tech Data has that entrepreneurial spirit and it’s all over; with our founder Steve Raymond, all the executives. We also have a long-term history with the executive team and it feels like a family.
CDN: Two trends that made news this year is the (alleged) death of the PC and Bring Your Own Device (BYOD). How does Tech Data see those trends going forward?
M.W.: Anybody in the PC world knows its evolving and the PC is still an important part of technology. We’re going to see if for quite a while. I do think more information will be utilized on handheld devices. As for BYOD, it’s very flexible but there are security concerns. At Tech Data, you had a standard issue choice of two devices: a blue one or a black one. But today it’s whatever you want and I think it’s fantastic.
Follow Paolo Del Nibletto on Twitter: @PaoloCDN.