10 Steps Dell Needs To Take To Avoid Channel Disaster

1. Top management needs to take the lead role in building and enforcing channel strategy. Dell has a big enough challenge already in getting its sales force to rethink direct-only to make room for the channel. Without someone at the top laying down the law, few within the company have any incentive to play fair with the channel. The word has to come from the top down, not the bottom up.

2. Hire a top-level channel executive from outside the company to run the show. We're sorry, but grabbing former IBM execs that held a channel post some 10 years ago just don't cut it. The channel is a different beast now and bears little resemblance to what it looked like a decade ago. Dell needs an outsider who knows and works with today's channel. That person doesn't exist inside the company.

3. Listen to solution providers. Incorporate their insights into the channel plan and be willing to change. A channel program is dynamic. There's no way Dell's going to get it right out of the gate. Be willing to constantly revise the program based on feedback from your partners.

4. Compensate your sales people more for channel sales than for direct business. That's the only way Dell sales people will get the message. If Dell truly wants incremental business, it must encourage Dell's channel partners to go out and find it without fear that it will be taken direct after the solution provider's done the heavy lifting.

5. Put feet on the street. Dell has an uphill climb when it comes to convincing the channel that it's sincere in working with solution providers. Channel field sales reps trump fancy partner portals any day when it comes to building lasting business relationships. Some of your competitors have scaled back on their channel field sales people. Beat them at their own game and flood the market with Dell channel sales reps.

Next: Partner Summits, Deal Registration, and Profit-Making Are All Very Much In The Mix 6. Hold partner summits. Dell has a lot of catching up in learning who solution providers are and how they operate. Dell's top executives need to meet on a regular basis with solution providers so they can dispel the myth that the channel is the devil. And, oh by the way, the channel needs to see that Dell executives in fact don't have horns.

7. Deal registration is a must. Building an effective deal registration program with a conflict resolution clause is a must. But really any such program is simply a rules of engagement plan showing solution providers where they play and where Dell direct takes the lead. And if the plan is for Dell to eat the cake and leave the crumbs for the channel, fold the tent and go back to your direct marketing babble.

8. Partners need to make money too. Dell needs to design an appropriate discount structure for their channel partners. Dell has a long history or undercutting partner pricing or cutting it so thin that VARs make no money selling the vendor's products. If Dell really wants incremental market share from solution providers, it has to give them a reason to switch customers to the Dell platform.

9. Do all of the above as quickly as possible. Rome may not have been built in a day, but it certainly didn't take as long as Dell is taking to put together its channel program. There is something to be said about going slowly and making sure you get it right. But this is ridiculous. VARs see the six months of rhetoric not backed up by concrete details as just another sign of Dell's channel waffling. Enough is enough.

10. Top management needs to take the lead role in building and enforcing channel strategy. Okay, we may be cheating a bit here because this is the first item on the list. But it's really the only thing that counts. If Michael Dell and his top lieutenants don't drive this channel strategy, nothing else matters.