HPE President Neri On Dell EMC’s Server-Storage Trade-Off, Cisco’s AI Strategy, Compensation Changes, And The ‘Massive’ Partner Opportunity Ahead
Time To ‘Double Down’ On HPE @HewlettPackardEnterprise President @AntonioNeri says the dramatic sales changes prompted by the Next restructuring initiative make it the perfect time for partners to “double down” on the $28 billion company. “This is a great time for partners to double down on HPE,” said Neri in an interview with CRN after he detailed the Next plan, along with a stepped-up charge into Intelligent Edge and hybrid IT markets, during a meeting with securities analysts. “We are a much more focused company. We have been and continue to be a channel-led company. We are extending the ability for partners to increase their coverage because of a geographic coverage focus [shift that moves HPE’s direct sales reps out of 84 countries in favor of a channel-led model].” Neri’s comments came after HPE said it was dramatically revamping its internal compensation by reducing the number of sales plans from 400 to 25; launching a channel-only sales strategy in a number of global markets; and eliminating 40,000 product configurations in its volume and value server businesses
What does the Next restructuring mean to HPE partners?
I am really, really excited about this. HPE Next is about three things: simplification, execution and innovation.
From the coverage perspective, we are really focused on segmentation and the number of geographies we are in. What we decided to do is focus Hewlett Packard Enterprise on 76 countries, which is obviously us and the channel, and then the remaining countries we are going to go channel-only, which means the channel has 100 percent ability to go sell where they feel it is appropriate with full autonomy. We are actually expanding dramatically the ability for the channel to go monetize those opportunities.
We are simplifying the number of [sales] offers, making it simpler for them to go sell, training them on fewer things, and then giving them the chance to really pivot between volume and value growth. I think that is massive. It is a massive opportunity to drive better outcomes and for them to sell solutions that have a higher margin
What are the improvements to business operations?
On the business operations side, we are still a little bit too complex to do business with. When I talk to customers and partners they always say, ‘Antonio, I wish you were a little faster. Your price turnaround time could be better. Your supply chain cycle times could be better.’ So that is why I am really, really focused on the execution side of the house, taking the number of processes down for partners, and empowering the front-line sellers and the people that work with the channel to give pricing faster. And then, ultimately, to streamline the logistics network on the manufacturing side. Ultimately, it is all about delivering in real time. This is about improving the partner experience with high-margin growth and giving them more greenfield opportunities they can go after.
How will the change in internal compensation plans from 400 to 25 impact partner margins?
We had too much complexity. That complexity cost us money. It was a bad experience. Ultimately, we had to process all those [400 sales plan] claims.
Going forward, we have 25 core sales plans aligned to where we want to drive the business going forward, which means it is going to be easier to do business for the channel.
One of the key benefits of PartnerOne is the loyalty we drive with channel partners. This is only going to make it eaiser for them to drive better sales and margins, and now it is easier to measure how they go do that.