ChannelPro-SMB - Pat Taylor's Blog

Channel-Speak: Business Associates

Pat Taylor — Tue, 03 Nov 2009 06:15:19 GMT

In 1844, a group of 28 artisans working in the cotton mills in Rochdale established the Rochdale Equitable Pioneers Society. These poorly paid weavers could not afford the high prices of food and household goods, so they agreed to pool their resources and buy the things they needed at a lower price. The principles that brought success to the Pioneers Society serve as the foundation upon which all modern co-operatives operate.

If you read the blogs I post on this site, you probably know that several dozen system builders have recently agreed to work together. Our Channel network is like a co-operative and a trade association combined; a trade association to advertise and promote our industry brand and a co-operative to better negotiate for goods. Our loosely affiliated group of like-minded entrepreneurs is already engaged in “Channel business” and has made measurable progress, negotiating a Volume Purchasing Agreement and Channel Discounting plans. The work isn’t finished, but we have made a start.

We’ve grown from the original 59 members to more than 80 participating companies during our first six months. And I should qualify this number; most of these companies are part of the Intel Premier Channel Partner organization - the top tier customer companies in Intel’s channel program. One out of five Premiers is involved in our network and the growth is totally organic – completely ‘word of mouth’. Recently, the second tier of Intel’s channel - the Associate level - has shown great enthusiasm for the Channel network initiative. Associate companies in North America number in the thousands and their participation will provide appreciable thrust to the effort. The need for collaboration is a topic of conversation at every Channel gathering I attend - and I attend a lot of gatherings…

So you heard it here first; some system builders and integrators are starting an association. By us – for us; that kind of thing. An association to preserve and promote the Channel. It will be organized to create and promote a Channel brand and to establish it as a premium brand; a preferred option in the eyes of the American buying public. Of course, participating association companies will maintain their individual identities, but gain recognition and benefits by demonstrating their Channel membership. Benefits like [co-op] better pricing.

These are not lofty goals, Channel peers; we have already negotiated a Channel Purchasing Agreement with one alternative distributor out West and have signed a provisional agreement with a purchasing entity to aggregate product on our behalf. To reap these benefits and others, you need only your Proof of Membership. (You can join the Channel network by following this link. It's free, except for the obligation to participate.) Creating the association is still in front of us, but collaborating and leveraging our strength has begun.

Something good is about to happen, folks. And system builders and integrators will want to be a part of it.

Channel-Speak: Channel Leadership in Action

Pat Taylor — Mon, 19 Oct 2009 14:19:19 GMT

Channel leadership fights the 'good fight' on behalf of their peers.

Intel's Board of Advisors is a team of 15 successful Channel executives who commit their time and attention to working with Intel to create better products, services and programs for the Channel. They are largely responsible for the creation and growth of a Channel network where independent Channel companies collaborate to improve their ability to compete in this changing marketplace. Among other accomplishments (not the least of which is convincing Channel entrepreneurs to work together), they have successfully negotiated Volume Purchasing Agreements with select distributors and are currently engaged in raising [Channel] brand awareness in the buying public.

(This video provides insight into the Intel Board of Advisors and the independent Channel network.)

Channel-Speak: EPEAT for the Channel

Pat Taylor — Mon, 12 Oct 2009 00:38:48 GMT

October 11, 2009

Channel Speak: EPEAT for the Channel

I just got back from Intel's Channel Alliance Summit. The event is designed to gather companies from the vendor community to communicate (and perhaps collaborate) on subjects relating to the Channel. Of the topics presented, I found the sessions on "Eco-smart" and EPEAT most interesting. Environmental compliance is a big deal with the people who buy our products now and in the future, and it is encouraging to know that vendors are working on the Channel's behalf.

The impact of the trend toward 'green' became serious when we first learned of EPEAT last year. This compliance criteria became boilerplate for a surprisingly large number of government and education organizations. When IT stimulus money was released, 22 government agencies were among the first to roll out RFPs for hundreds of millions of dollars of work. To the Channel's dismay, every tender issued by these agencies required that the participant provide EPEAT-compliant equipment. The small businesses that were the intended beneficiaries of the stimulus plan were prohibited from competing by a standard we cannot meet. If there was a "bright side" of things at that time, it was seeing the vendors share our surprise and dismay at the discovery.

Some of the vendors (most notably Intel) directed resources to assist the Channel with programs and compliance consultants. Others have taken a more creative approach. At the Alliance Summit last week, we heard Paul Parkinson of In-Win (the chassis and power supply vendor) describe their company’s effort to support the Channel. His team proceeded with a strategy built around the idea that EPEAT is not about a particular product (although that is how it’s managed); it’s about a process. So Paul and his crew organized the documentation, processes, and process management required to meet EPEAT’s compliance specification. This very creative (and quite effective) approach took many man-hours to execute, but the results seem spectacular to Channel guys. By the end of the year, a Channel company should be able to purchase a chassis and power supply from In-Win and assemble an EPEAT-compliant machine. The chassis and power supply will come with "manuals"; Energy Star and EPEAT compliance guides that will list the certified parts (and their vendors) that a Channel company can use to assemble their machine. With EPEAT compliant desktops and laptops, we can compete for stimulus dollars in government and education infrastructure opportunities. We can compete for business where environmental compliance is a requirement.

There is still work to be done. We need other members of the vendor community to step forward and join Paul Parkinson at In-Win. His team has done most of the heavy lifting; other vendors need to communicate with him and certify their technology as part of In-Win's compliance stack. More vendors - more variety; more technology for the Channel to use to build custom solutions for customers. I was at the Channel Alliance Summit last week and I heard Paul's presentation to his peers in the vendor community. There was interest and enthusiasm, and I hope that translates into action. It won't hurt if the system builders reading this blog will (the next time they're on the phone with them) ask your vendors what they are doing to help you achieve EPEAT compliance.

The real message lies more in the method than in the result. The Channel identified the problem during an event hosted by a vendor. A vendor takes up the cause and brings a solution to the Channel. All this in less than a year…

..imagine our achievements when we’re properly organized.

Channel-Speak: The Extra Mile

Pat Taylor — Sun, 06 Sep 2009 22:21:51 GMT

September 2, 2009

Channel Speak: The Extra Mile

(Part 3 of a three-part series titled Sales Savvy for the IT Channel)

In the last blog, we talked about prospecting as an essential and often neglected part of the sales process. We talked about how the old prospector’s advice was relevant to today’s businessman; we have to move a lot of material if we’re going to find any gold. And salesmen should be prepared to go through a lot of prospects to find some customers, too. Finally, we discussed the fact that prospecting is hard work, and that nobody likes hard work. But the secret to success in prospecting (and in sales) is making a habit of doing the things that no one likes to do.

Some sales trainers call this "entering the Discomfort Zone" and others call it "walking the Extra Mile". So what do the old sales maxims do to help channel companies run a better business? How can they help them make more money? How does a CEO get into his Discomfort Zone, and isn't every president always walking the Extra Mile? The direct answer is "no". They walked the extra mile to earn the title and position, but some relax as soon as the achievement is realized. They continue to work hard and smart, but they don't always go the Extra Mile. Let’s use this common scenario: the president of a small company observes an unsettling decrease in sales and profits. His comfort zone might be found in the safety of employees and customers that tell him what he wants to hear. This is not productive – may be destructive – but it is certainly comfortable. His Discomfort Zone is probably a place where he solicits ideas from those with whom he does not agree or even like. It’s awkward and uncomfortable, but some of the ideas are brilliant. Another related example of Discomfort Zone activity is an executive with a history of success being forced to consider the unreasonable. Reinventing the business. Reestablishing its culture. Redefining the business model.

I have an example I can share with you about a channel guy who wouldn't consider a change in his business. He was a system builder with expertise in high performance workstations. The people who used these machines were very skilled with the application software and had experience with peripherals and device driver loading. However, they were network-challenged; they could not manage or network their dozens of servers and workstations without the help of my friend’s “computer company”. For years, every time I saw my friend, I would ask him if he proposed a service contract yet. He always looked down and shook his head from side to side and said something like "No, I can't charge for service. It's part of the deal." And that’s his comfort zone! Rather than risk change or temporary rejection, he will hide behind that comfortable excuse until he loses this opportunity to move toward service revenue; an inevitable part of his future. And that is what we need to be willing to do; we must be open to change with the times. Consider this:

   - Add “Service” as a revenue stream
   - Start a Medical Products division
   - Build a Storage practice

Each of these disciplines is known to be a growth market featuring high margins. Have you given them any serious consideration? Have you gone the extra mile and given your company every chance at success? Do you trust your people enough to solicit their opinions and ideas, and act on the good ones?

When you make time to consider the alternatives, you enter your Discomfort Zone. And when you are actually in the act of consideration, you are walking the Extra Mile. Things seem to slow down and decisions are easier to make on the Extra Mile. You consider each option as something you might like to do – something you could plan to do. Neutralize any emotional or logistical reactions and venture into your Discomfort Zone with genuine interest in the potential. Then walk the Extra Mile; act on the possibilities. Don’t be afraid to fail.

Channel-Speak: Prospecting for Riches

Pat Taylor — Wed, 19 Aug 2009 22:15:18 GMT

August 19, 2009

Channel Speak: Prospecting for Riches

(Part 2 of a three-part series titled Sales Savvy for the IT Channel)

No prospecting, no sales. No sales, no riches. It is as simple as that...

Prospecting is the most difficult component of the sales effort. Another term for "prospecting" is Lead Generation. You can Google "lead generation" and you will find page after page of prospecting techniques. They are the same techniques that salesmen have used for decades, and (the bad news is) there is no "Magic Bullet". Prospecting techniques include:

Newspaper or magazine advertisements.
Local business associations.
Public records.
Canvassing.
Trade shows.
Direct marketing.
Internet marketing.

I don't pretend to know which of these techniques is best for your business, but I do know the secret to success in Prospecting, and I will share it with you now...

The secret to success to Prospecting (and most every worthwhile endeavor) is making a habit of doing the things that no one likes to do. And no one likes to prospect! But if we make a habit of doing the things that no one likes to do - things like prospecting - we almost guarantee our success.

Jerry Rice is the most prolific wide receiver in the history of the NFL. Throughout his career, Rice was well-known for his work ethic; he would arrive first and leave last from practice. He would work on the fundamentals of his game even after achieving the status of a multimillionaire star. He would practice framing the ball, route running, footwork, and separation techniques in spite of the fact that he had demonstrated his expertise in each of those disciplines over and over again. His peers found the incessant attention to fundamentals a "grind", but Jerry made a habit of doing the things that no one likes to do. The end result is success beyond his wildest dreams.

No one likes to prospect, but successful salespeople make a habit of it. It's not something they do when they need new sales; it's something they do every week as a scheduled part of their sales activity. Here's an example of a prospecting schedule for salesman's work week:

Set aside time every Tuesday, Wednesday and Thursday; you may choose two hours in the morning or two hours in the afternoon. (I have found it easier to contact a prospect early or late in the day as he is usually preoccupied during peak business hours).
On Tuesday (morning), call to schedule two sales appointment for the following Tuesday afternoon. On Wednesday and Thursday (mornings), repeat the process. The result will be six qualified appointments for the following week; two each for Tuesday, Wednesday, and Thursday afternoon. In the mornings before those appointments, call to schedule more for the next week.
Commit to making this process a scheduled activity for every week. You will undoubtedly encounter or create all variety of good reasons to break this schedule, but your success depends upon your commitment to making a habit of doing this thing that no one likes to do.

Decades of experience prospecting in this industry and others has taught me these additional lessons:

Script it. Just like a martial artist practices and memorizes a series of moves (kata) before ever engaging in combat, a salesman must know and be comfortable with his "pre-approach" before he ever picks up the phone. It should never sound canned; we want a reflexive response to a conversational opportunity. An example that can be used when selling technology is:

"Mr. Prospect, I have no reason to believe that you're in the market for a server or storage system today. But I do know that when businesses like yours buy servers and storage, they buy from reputable companies or from people that they trust. I would like to introduce myself and my company so that - the next time you're considering server or storage technology - I'll be the one you call."

Don't talk too much; don't tell it all. Ask good questions and listen.
Smile. Even though you're speaking to a telephone, the customer can "see" your smile.
Prepare for rejection. Like a Marine in a ballroom asking ladies for a dance, rejection is predictable. Persist.
Find strength in the Law of Large Numbers. There will be weeks where everything goes wrong, and weeks where everything turns to gold. Prospecting will yield an inconsistent result; that's why we make a habit of doing this thing that no one likes to do.

I have often shared my experiences prospecting for gold in Alaska. I stood on the windy beach of the Bering Sea, carefully feeding my sluice with one scoop of black sand at a time, and I heard an ol' sourdough chuckling at my efforts. After asking him why he found my prospecting technique so humorous, he replied,

"You won't get much color workin' a scoop at a time, boy. Ya' gotta move a lot of dirt if you want to find the gold."

Truer words have never been said...

Channel-Speak: Sell to Survive

Pat Taylor — Wed, 05 Aug 2009 15:30:26 GMT

August 3, 2009

Channel Speak: Sell to Survive

Businesses without sales fail.
We must sell in order to survive.

* * * * *

We probably wouldn’t take time to read this stuff if sales were up. But sales are down and we need a sales refresher. It is time to revisit the basics; the blocking and tackling of Sales.

We can blame our numbers on the fact that our customers are buying less; and it’s true.

• Revenue from Microsoft’s OEM Channel decreased 31% is reported.
• IDC forecasting 22.1% decline in server revenue year-over-year.
• Storage spending is down over 18.6% year-over-year.

Unfortunately, those truths don’t change the fact that we have to make more money than we are making right now. And since our customers seem to be spending less, we need to find more customers. It is literally as simple as that. We have to sell more.

As a company executive, you can demonstrate the sales leadership that your people are looking for in times like these. Clearly articulate your company’s sales plan and validate its importance with your participation. One of the great things about being an executive with a small business is when you call for an appointment; you know you’re going to get one. Customers like to see the Boss. They will tell you how great it is to see you, and you will let him know that you like staying in touch with important customers. Ask a few questions and, as you practice your listening skills, he’ll tell you everything you need to know to solve his technology problems. You will leave with a sales plan for this customer. And if you stack up sales plans from enough of your customers, you build a believable pipeline. Because you’re his peer, your customer – the owner of a small business – will talk with you on a level unreachable by large manufacturers or e-tailers.

The uncomfortable truth is that we must forever find new customers to feed our need for greater profits. The successful companies will be the ones who go to all their customers and ask them important questions about their businesses and

1. What major technology do you see impacting your life in the next 3-5 years?
2. What excites you about this technology and what do you see as the downside?
3. Is it virtualization?
4. The virtualization of machines or of storage or both?
5. What about security?”

Please take time to listen to their responses. Resist the urge to contribute anything but your curiosity. This is where the relationship is cultivated. Write down their answers to show you value their contribution.

Schedule a few hours out of the office each week (during your least favorite time to be there) and meet with customers. Sell as though your business depends on it. Make it a habit. Sell to survive.

(This is an introduction to a collection of articles called ‘Sales Savvy’. The first of three 3-part series begins next week; each focused on a specific skill for selling technology and ‘solutions’.)