APC Aims To Change UPS Market

When Schneider Electric Inc. acquired APC in early 2007, it merged with MG, and executives decided to get together to figure out what the future APC would look like and what its best route-to-market would be.

"The channel has been APC's lifeline to the marketplace for some time and certainly when Schneider came in, they decided it was something they would continue to invest in," said Marc Sherman, vice president of global channel programs for APC, West Kingston, R.I.

APC spent its next year re-evaluating every aspect of how it works with its solution provider partners. It hasn't exactly been an easy time, with competitors like Liebert, part of Emerson Network Power Co., moving aggressively to court long-time APC partners. Still, APC executives have begun meeting with VARs to explain their strategy and direction under Schneider.

If there's been a key step, it's been that the company has organized its channel program around customer type, to focus resources on those with large data centers, or small businesses, for example. The new focus appears, at least initially, to be getting some traction with partners.

Sean Powers, sales manager at RTM Communications Inc., Merrimack, N.H., attended APC's recent event with partners in Waltham, Mass., and said he liked what he saw and heard—both at the event and the message.

"I thought it was just awesome. It was a nice intimate gathering. It wasn't a big trade-showy kind of thing. Their CEO was there. We got to talk with senior management and understand what's happening and what's going to be happening going forward," Powers said. "I think it all boils down to the fact that they've crafted this partner program based on partner feedback."

Even before APC shook up its channel program, Powers said, the company had been making positive changes. "Purchasing has improved; supply has improved; scheduling of assembly startup services with field engineers has improved," he noted.

Next: Crafting The Road Map Crafting The Road Map
The first thing APC did was sit down with its end-user customers and ask what their concerns were in regards to power and cooling in the data center, and then what they expected from being an APC partner.

"That had to be the starting point to understand what customers were dealing with," Sherman said. "If you think about the importance of their data and the reliability of their networks, it's at an all-time high. Their technology infrastructure and the business processes that technology supports are critical to an organization."

That evolution, solution providers agree, has changed the way solution providers need to interact with their customers when talking about power and cooling in the data center.

"If you look at the technology-buying cycle, in the past it was all about technology. Business process, software and then technology. Today we find our customers looking at physical infrastructure first before they actually deploy the technology," Sherman said.

That rationale led APC to rethink the way it structured its channel program, starting with how it approaches the market. APC had to take its UPS products and reposition them from add-on peripherals to core components of a data center solution. And as customers become more concerned with the cost of electricity and being "green," the UPS can even take center stage, Sherman said. "It's becoming its own category, allowing them to generate enough margins that you can actually lead with this."

APC then asked its partners what they wanted from the company. "We had to ensure that we did it but [that we] also meet their business objectives, the financial objectives they set as a company," Sherman said.

In response, APC crafted the program to educate VARs on how to profitably sell power supply solutions to different types of customers, from large corporate data centers to midmarket companies with a single rack of servers to small businesses.

APC identified six critical success factors to help its partners: profile, alignment, empowerment, enablement, collaboration and profit. The vendor is first helping profile its partners to find which solutions and customer sets are best aligned to their capabilities. It created four tiers to its partner program with different sales and training requirements: Registered, Select, Premier and Elite.

Education and training are an integral part of the program, helping VARs learn how to design and implement solutions for different customer segments, and APC is traveling to 10 cities this year to meet with its partners.

For Todd Boucher, vice president of Defiance ElectricCrossover, Enfield, N.H., APC's channel alignment has created a higher quality partner ecosystem.

"Because their name is so ubiquitous in the market, by default they had a tremendous amount of partners in the marketplace. The challenge with that was that the market was flooded with people who had access to APC products but may or may not have been the most qualified to provide a solution depending on the customer scenario," Boucher said.

"Where I believe the change in the program really is of value to both partners and customers is that it allows partners to focus on what their areas of expertise are as they apply to APC's product line and, therefore, customers receive a much more applicable service set," he added.

APC is also leading the way in product development, Boucher said, giving him better solutions to sell.

"It's obvious that they invest heavily and have invested heavily in research and development, and through the launch of the infrastructure line they really were revolutionizing the way that data centers were not only built but the way data centers were thought about," Boucher said.

"APC is by far one of the technology leaders out there for innovation when it comes to infrastructure. The only people I view as being in the same class that make a difference in the customer's environment are Cisco Systems, Hewlett-Packard, Microsoft," Powers said. "They're best-of-breed with all these world-class vendors."