Spotlight on Dell Technologies | ChannelDrive.in
Continuously driving meaningful innovation has resulted in great performance by Dell Technologies as a global organisation. The company is able to achieve fantastic growth – quarter on quarter – and its vibrant channel partner ecosystem has played a critical role in terms of efficiently funnelling Dell’s products and solutions to the market segments and verticals.
ChannelDrive.in had the opportunity to interact with Dell Channel Leadership:
- Joyce Mullen, President, Global Channel, OEM & IoT, Dell Technologies
- Tian Beng, Senior Vice President & General Manager – Channels, Asia Pacific Japan, Dell Technologies
- Anil Sethi, Vice President and General Manager, India Channels, Dell Technologies
Key areas of discussion included the company’s 2018 performance report card and 2019 channel roadmap, challenges and opportunities in the current business, Dell’s product portfolio from edge to core to cloud, the company’s 7-fold growth of channel business in India and how Asia is a top performer in the channel business, globally.
How has Dell Technologies performed in a highly competitive market?
In the past year, we have added over USD 11 billion in revenue on the top line and we have been successful in gaining market share in all the major categories. We feel that we are at the right place in the market in terms of the investment & commitment that customers are making around their digital journey, which in return is generating an investment wave.
We have gained a disproportionate share of growth in the market, and we think it is largely due to the strong combination of Dell and EMC portfolio. This portfolio offers the essence of what the customers are most interested to invest in.
We have done a great job in putting this portfolio together so that we can offer multiple range of high-value solutions to customers. In fact, a part of it has to do with a really robust channel community who has done a very good job in representing our portfolio and our solutions. For the same period, we booked 50 billion dollars in orders on the channel front which is obviously more than half of the total sales. The number is only growing.
According to our net promoter score surveys, we’ve made significant improvements in supporting the vision of being simple, predictable, and profitable. Of course, we have a lot more work to do but the channel partners support is very gratifying. We are excited about the 24 consecutive quarters of share growth in our PC business. We are also seeing an incredible server momentum which took us to a leadership position in servers this year.
The three strategic initiatives that we have laid out a year ago for our partners remain unchanged, which makes it easier for partners to do business with us. Second, is helping our partners transact and engage across the family of businesses in Dell Technologies. Third, is helping our partners embrace and monetize new technologies which have the most upside over the long term and we still have a long way to go, but we are starting to see interest in AI, machine learning, augmented reality and IoT, etc.,
Ng Tian Beng:
As Joyce mentioned, the whole company had an amazing year. In APJ, we grew the business even quicker than the global averages and we have been making strong progress. Channel business specifically grew even quicker than our overall business which is a good sign as channel partners are giving us their vote of confidence. In India, we are obviously happy about our channel business and it is actually one of the largest channel regions for us in APJ.
In fact, not only is it one of the largest but importantly a lot of our partners are really happy working with us. India has one of the highest net promoters score in this region. Over the past couple of years since we started the business, we have grown at least 7 times.
To add a few pointers, we have been growing seven times as Tian Beng said and it has been fantastic. We are consistent with a couple of things, one is trust, which is a very high factor that keeps our partners engaged in business. The second is that we have been consistent with our strategies and our GTMs which is very critical for the partner’s success. This has created a huge amount of comfort between the organization and the partners. Dell Technologies has a lot of transparency which plays a very important role in our success. And the third thing is our strong portfolio. Dell Technologies has all the products that you need which become an opportunity basis on our portfolio profitability which has a high conversion ratio.
Ng Tian Beng:
The combination of Dell and EMC portfolio from compute PC storage plus virtual addition software is very powerful. And that simple strategy is resonating so well. Today everybody, if they are not working with us, they are talking about us, which is an effect of our partner’s success.
Moving forward, what are the 3 top things that Dell Technologies will be doing in order to keep growing like this or at a greater pace?
For the last three years, we have spent over $ 12½ billion on our R&D. So, we are very much committed to investing in innovation. We have a very robust R&D budget, and we also have a Dell Technology ventures team which keeps an eye on the market and understands the technologies of today and tomorrow.
There is a tremendous opportunity for partners in this. If you think about the kind of complexity of the servers, and how they are changed to support AI etc., or the need to manage data in a very different way – the advantage is that we have a very robust R&D and we can invest into newer technologies that are coming into the market. Dell Technologies’ has the world’s biggest direct invest sales force and an incredible channel community, a channel team that is driving the 50 billion dollars’ orders.
So, we will continue to invest in skills, development and coverage and always be working on improving efficiency and talent. VMWare is a standalone company. Secure Works, a very solid security company. Pivotal, a leader in application and modernization. Dell EMC is pretty good at the hardware supply chain ecosystem. But we need to figure out how to make those companies work better together. The silos are all really strong and melding these silos will help us leverage each other’s strength in a much more efficient way. It’s a 3 trillion-dollar market, we are 92 billion dollars, a lot of upsides and growth opportunity.
We are the only company in the country and APJ who builds into the partner and the only company in the country which gives credit lines to the partner directly other than distributors, systematic integrators or our metal partners. It may not be adequate but we have given extended credit lines. The credit number runs into a few couples of hundred million which we have created as credit lines all put together, which led to the partners trusting us.
What is your opinion on the Cloud Business being driven by Partners? Do you see any challenge there?
We have seen incredible growth in Cloud and growth in on-prem. So we absolutely believe in the multi Cloud – Hybrid Cloud environment which is going to be in play for a long time. All different cleavers of clouds, all different combinations of clouds and we do think that there’s going to be some actually new types of clouds, maybe storage only clouds where they compute in public clouds for burst capacity and then some compute is on-prem and we can access this data centrally.
Ng Tian Beng:
I think in the past maybe people thought that it will be mutually exclusive but actually we were one of the first in the industry to contradict this saying it will be Hybrid Cloud. Hybrid Cloud would obviously continue to grow but the on-premise will grow rapidly. In fact, one of the trends that we have been seeing is that a lot of our customers who previously moved aggressively to the public cloud are actually, moving their workloads back to on-premise.
How does Dell – as an organisation enable a balance with its direct and partner business?
It has always been very clear at Dell that both businesses are equally important. So the objective is both to grow. There could be sometimes, so one is to grow exactly in the same ratio and then we just ensure that we have very well segmented accounts and RTMs are clearly defined, they say in accounts we got to go it with this RTMs vis-à-vis these RTMs. We have gone to an extent where we have given log incumbency we have created, the storage accounts will always be with the partners, we will never go direct. You can call it account protection.
So I think partners continue to engage with us in a profitable way and that’s why we see today we are ranked No 1 in many categories because I think that’s one reason. We are super clear the way we deal with the registration process. Second, where does this whole thing come up? We have a defined market after that there is a bottom of the pyramid market and this is SB you can call it, our other markets. I believe in that one thing that between success and the failure there is the only thing which works is hunger. It matters both sides, if you are successful you get your hunger, if failed you will be more hunger to be successful.
We are super hungry people. So we have a capacity build-up and no other company has it. We are clearly hungry, and we don’t want to leave any piece of the market because our portfolio is right from the edge to core. So, we have this whole range of CSG Client portfolio, from Vostro to Latitude, the entire Notebook range. We can address the entire segment of the market.
How is India performing compared to any other global market?
Not everyone is performing exactly like this but India has an advantage in many ways. Tian Beng already mentioned it but it’s one of the very biggest Channel markets in the world and also one of the fastest-growing. Storage grew faster here in this market than any other place in the world and it’s on a foundation of a lot of innovation, entrepreneurship and venture capital.
Ng Tian Beng:
Last year our global Channel business was US$ 50 billion and it’s growing at 18% year by year.
So, is there any market where you are only going direct and not Channel?
Ng Tian Beng:
As Joyce mentioned, our strategy is only Channel, that means we give customers trust. In fact, there are some markets which are 100% only on Channel. As some of the emerging countries, for example, countries like Pakistan, Sri Lanka, Bangladesh, Nepal are 100% only Channel.
On a global level and then maybe on an India level, what is that big challenge that you see which you want to overcome in the coming months or years?
I think that the opportunity here for us to figure out how to institutionalize and trying to figure out how to optimize the seams instead of the silos. This cannot be solved in two months or four months but I think we will make a lot of progress and our partners will see that through this initiative which allows them to transact and engage across the Dell Technologies company portfolio.
Ng Tian Beng:
A lot of our customers want to look across the whole Dell Technology family, Dell, VMware, Pivotal and how can we provide an easy way to really transact and take advantage of all these different solutions.
I think the most important thing for partners is the need to improve our financial discipline and improve their ratings. Because once these things improve, there won’t be any other issue; this is the biggest investment in any growth. This improvisation will lead to other promising players as well.
Channel business is growing, you are growing, how has the face of distributors changed? Because a lot of distributors now are doing Cloud solutions, AI Solutions, so, what is the next phase of distributors which are going to help you?
To set the context, the channel grew at 18%, distribution last year grew at 21%, which is even faster. And what we are seeing is distributors figuring it out how to offer differentiated services and they also give us more reach.
Hence, distribution remains a very critical route to market that we will continue to nurture and grow the same. Distributors are also trying to figure out how to become more solutions oriented and build their own consulting skills, direct sales capabilities so that they can create demand for partners.
How are you fast-tracking the ability of your partners with your transformational solutions? How are you actually empowering the ability of your partners that they should be able to sell that unique technology that we are having?
We have executed this in multiple ways. The first is, we have a fairly robust credentialing and certification process where we are now training on solution competencies and capabilities. Some of them are around those new emerging technologies.
Combining this with technical enablement, we train people how to position the solutions and elevator pitches endorsements so that they can talk about the Dell technologies’ advantages which are the two primary ways.
Your partners are performing good in the SME space? Because what we are observing that the Cloud is playing better in SMEs. It will grow in that space. How are you positioning your partners?
SME is one of the biggest focus areas for Dell Technologies. We call it geo-expansion phase and we have set defined accounts given to the partners and segregated it depending on the cities and we are working with them to make it more effective.
There are two kinds of aspects, some of which are new businesses they go into Cloud. Traditional entrepreneurs, they would still prefer on-premise. I have experienced this in my earlier roles, everybody is not comfortable with this arrangement especially Tier-2, Tier-3 cities in SME side.
How do you see the digital transformation within the Channel? How are they internally looking at transforming themselves to meet the customers need? Is that happening?
Some of our top partners are really technology conscious. They want to build organizations and ensure that their organization’s valuation grows up.
According to IDC, this year or in the next 12 months 50% of resellers will be in the last stages of digital transformation.
And what were the numbers of the Channel partners here?
We have about close to 140 odd middle partners and we transact with close to 1450 odd partners. This would include all our stock and sell everything all put together. And we have about 4000 passages to partners.