Misc

Dell as an SMB VAR: From the horses mouth

March 27, 2012 , 1 Vlad Mazek

Two weeks ago I wrote about the partner reaction to Dell’s planned acquisition of SonicWall. Many of the partners are not happy, to say the least. Arlin Sorensen from HTG noted a very personal appeal from the SonicWall folks claiming it will be business as usual. Today I had a chance to follow up on this and hear the story straight from the horses mouth as we were invited to Dell’s regional sales show to announce the new generation of PowerEdge servers.

Just to be fair, we’re a customer of Dell’s and use their servers exclusively in the ExchangeDefender network. We’re fans. This post is about you, not us, so I’ll keep the fanboyism to the minimum.

The audience was made up of very large accounts (I sat next to a guy from Xerox) and there were a few partners that inquired about the SonicWall purchase as well as a lengthy discussion by Dell’s sales team.

The part that really got my attention was when the sales guys attempted to answer the question about Dell going away from a hardware business and into a solutions business. Paraphrasing of course:

I spoke to a client a few weeks ago that was concerned about having to buy equipment from HP because Dell was exiting the hardware business and wanted to be a solutions business. To an extent that is true but let me qualify it:

A few years ago Dell was seen as a hardware company. Remember ‘Dude, you’re getting a Dell’ commercials? They are a bit of a black eye on the company, we were all about laptops, printers and desktops.

We want to be seen a solutions provider. We’re obviously a box company and we will remain a box company but we want our clients to be aware that your can buy software from Dell. You can have Dell provision and configure your boxes. You can back your boxes up to Dell and you can even burst your applications through our cloud. You can protect your infrastructure through Dell and do so much more than just buy a box.

This is interesting.. because this is the very same thing IT solution providers are trying to do. Much like Microsoft before them, you get a sense that Dell doesn’t think it needs any help on the low end of the market – dominated by IT consultants, entry level MSPs, VARs and various technology advisors.

This happens to infuriate the bottom of the channel because of the dual mandate: Not only are these folks out there fulfilling an actual need when the “solutions” don’t turn out to work as advertised, but they are also stuck cleaning up the mess after they got beaten out of a proposal with a cheaper solution that was not adequate for the business.

Looking back to 2007, did Microsoft BPOS obliterate the channel? Of course not, the technology companies who realized there is still lots of money to be made in this partnered up with friendly companies that were on the same page. Did it make BPOS fail? No on that count as well, there are signs that Microsoft is doing quite well in the cloud.

So how do you reconcile the two – how do you compete with billion dollar companies if you are after the same client base? The answer is surprisingly simple: Know who your friends are and know who your competitors are, define your business model and ask your client base what they would value more. Not all markets are the same, not all industry verticals are the same and not all clients are the same – and that is the SMB advantage, flexibility.