Dell's partner-first strategy to pay direct sellers more to go through channel

Dell president of sales and customer operations Bill Scannell said this is the biggest change to the company’s go-to-market

Dell's direct sales reps will earn more money if they move its market-leading storage products through the channel than if they take that same business direct.

The change comes as Dell presents a new partner-first sales strategy.

"With this new strategy around partner-first, every one of our reps is going to look at their comp plan and see, ‘I make X if I sell it directly. I make X-plus if I sell it through a partner,'" Bill Scannell, president of global sales and customer operations with Dell Technologies, told CRN.

"This opens the floodgates. They're going to be calling up their favourite partners and saying, ‘Hey, let's work together on this.'"

Included in the new programme, called the 'partner-first strategy for storage' are PowerMax, PowerFlex, PowerStore, PowerScale as well as hyperconverged and converged products, security storage products, all of what Scannell said Dell Technologies calls 'Big S'.

Dell holds the No. 1 spot in external enterprise storage with 31.5 per cent of the market and the No. 1 spot with software storage with 11.5 per cent, according to June numbers from IDC.

In the last quarter, Dell infrastructure sales took an 18 per cent hit, with storage down 11 per cent over the same period a year ago.

Scannell said he is not worried about the latest numbers.

"It doesn't matter what the markets are doing.

"If we have 30 per cent share in storage, what we want to do is take share from our competitors," he told CRN.

"All of these trends, all of these transformations are driving a huge need for storage.

"As the market leader in storage and data protection, I think we are really positioned to win big here."

Top Dell partners praise move

Dell Titanium partners at Somerset, New Jersey-based Melillo Consulting and Hatfield, UK-based Computacenter each praised the move in separate conversations with CRN.

Melillo CEO Scott Dunsire - a former HPE channel chief - called it "genius."

"I haven't seen a move like this in a long time, if ever, and I ran channels at HPE for 12 years," Dunsire told CRN.

"Dell has just been getting better and better and better at engaging partners...This is a genius move, from my perspective, to send the right message to the team at Dell. ‘Hey. We're serious about working with partners. You want to get paid more? This is what you have to do.'"

Computacenter's North American president Neil Hall said he loves it because the channel now has more confidence when doing business with Dell.

"It gives predictability and strength to the channel," he said.

"This is the biggest step I've seen from a vendor to place much greater significance on the channel in one sweeping move.

"We want to be there. We want to be a strong partner for Dell and build great success stories for our customers."

Dunsire said no matter which vendor it is, sales have long been split between the competing interests of direct and indirect teams as they fight for the same customers.

Dunsire said the brilliance of this moves lies in threading the needle between both types, and incenting behaviour that aligns them to act in tandem.

"This pulls down a barrier that has been there for a long time in the channel, which is end-user teams versus the channel teams," he said.

"I think Billy (Scannell), (vice-president of North American channel sales Dell EMC), Greg Ambelos and (President, Sales, Global Theaters and Dell Technologies Select) John Byrne are all aligned and that really helps too.

"This is one more indication that, ‘Hey we're putting our money where our mouth is.' That's coming from a guy who used to think Dell Technologies was the Antichrist and didn't partner well.

"I have experienced just the opposite."

Michael Dell fully on board

Scannell said it's not just sales that is behind Dell Technologies wading deeper into the channel.

He said Michael Dell, Dell Technologies founder, chairman and CEO, as well as COO and vice chairman Jeff Clarke are also on board.

"This is the biggest change ever to our go-to-market," Scannell said.

"This is massive. This is exciting.

"We've been working on this for a while, because we want to make sure we get it right.

"But we got it right and it's supported Michael Dell, Jeff Clarke, all the way through the organisation."

In a statement Michael Dell hailed the move as proof that the company's investment in partnerships runs deep.

"We have decades of experience working with our partner community to accelerate transformation for customers," he said.

"The ‘partner-first strategy for storage' extends our partner commitment and unites the strengths of our partners with the advantages of our world-class team and solutions."

Byrne to partners, sales reps: ‘Go make more money'

Byrne, who was previously a channel chief for the company, said by coordinating the sales teams with the partners, Dell can multiply the efforts of both.

"We're making it very clear. If there was any confusion.

"There is no confusion any longer. The message to channel partners: call the reps.

"To the rep: call your partners. The gloves are off," Byrne said.

"Go make more money. Go sell the best storage portfolio in the business. Go keep taking market share. It's big and it's exciting."

The move comes as Dell is taking aim at the $30bn generative AI total addressable market and the role that storage plays in successfully bringing AI models to market.

Just last week, the company introduced validated designs for creating on-premise generative AI solutions with Dell products - included in those are Dell's storage products.

PowerScale, for example, is listed as a repository for AI models, model versioning and management, with the capacity to handle large data requirements.

After nearly 40 years in the channel, Scannell said the more things change, the more they stay the same.

"I started my career 37 years ago selling storage. I had success because I leveraged our channel partners. They were my best friends," he said.

"I keep saying I love channel partners because they're an extension of our go-to-market. They're an extension of our sales team.

"Now the entire organisation is going to love the channel."