CRN Interview: Edgar Masri, 3Com CEO

Edgar Masri, who took the president and CEO reins at 3Com in August, outlined the networking vendor's channel strategy in an interview with CRN Infrastructure Editor Jennifer Hagendorf Follett at the 3Com Partner Summit in Boston. Here's an excerpt of the discussion.

CRN: What is your goal for the conference?

MASRI: The goal is to reiterate our commitment to the channel and our desire, working with them, to change the rules of the game in providing solutions for small and medium enterprises.

CRN: Do you think that message has been diluted?

MASRI: I think with the acquisition of TippingPoint, we have been able as a company to win and provide solutions to large enterprises. The message got, in the process, a little bit diluted because people had a feeling that we were now going direct into the enterprise through that opportunity. It is true we are winning in large enterprises with the TippingPoint offering, but for 3Com converged solutions, which are the data and the voice offerings, I wanted to make it very clear that our sales will be primarily through the channel and that our direct sales force there will be an overlay to it.

CRN: Are you backing off of 3Com's strategy to target the enterprise through partners?

MASRI: They are by definition small and medium enterprise resellers. What I wanted to stress is the importance to look at every opportunity and ensure from the back end that we are totally capable of supporting them. What I was specifically highlighting is the tendency in many situations, because we are building products that scale, to err on the side of going to too large an opportunity without having studied the implications. Eventually we'll get there, but I just wanted to send the message that the focus that I talked about is on small and medium enterprises, and what I mean by that specifically is to about 2,000 users. Now, will we go and win an opportunity beyond that? Yes, but it will be studied, analyzed and we will ensure that we can support and win with this customer throughout the lifecycle of the solution.

CRN: Is it your expectation as you push toward larger enterprise sales that it would be the partners like the ones here at the conference moving upscale with you or a whole new set of partners?

MASRI: I think some of them in this room have done it and will help us. I do expect, though, that we will need to look also at complementing our stable of partners with the ones that have traditionally supported large enterprise I'm looking more for partners that sell security solutions, I want them to start first by helping us win in small and medium enterprises, I want those who are providing wireless solutions end-to-end in small and medium enterprises. Eventually, yes, it will be large enterprises, but our focus is small and medium enterprises.

CRN: So most of the partners here at the conference aren't selling TippingPoint because it's not focused on the SMB space?

MASRI: Some of them are already enabled to do that. What you need is certification. It's primarily up to the resellers' ability to sell and support such product. Some of them have already been certified on TippingPoint, and we look forward to having more partners sell it. CRN: But it's still more of an enterprise focus at this point?

MASRI: Yes, but then you can see even at TippingPoint there is the X-series, which lends itself to medium and small enterprises—primarily medium I would say—and today our direct touch sales force in TippingPoint is selling them, and I would like to see more of our channel partners being leveraged for that.

CRN: What's your assessment of the health of 3Com's channel effort?

MASRI: I was very encouraged by what Nick [Tidd, vice president of global channels] had already developed with the partners. I do believe that it is already and it will continue to give a competitive advantage. We rely a lot throughout on those relationships with partners.

CRN: Is there a particular directive or goal you've given Nick on what you'd like to see out of the channel in the coming year?

MASRI: I could imagine growing faster than the market and enabling our partners to feel that they can be more profitable selling the 3Com solution.

CRN: How far off are you now from that target?

MASRI: I do think we have a lot of infrastructure pieces in place. I'm seeing anecdotal results supporting the overarching goal. We need another couple of quarters to be able to gauge the success across the board.

CRN: You alluded several times in your remarks to events two years ago when 3Com surprised many of its partners with dramatic changes to the channel program. Is it your sense they've forgiven 3Com for that?

MASRI: I do think we have a very loyal base of people who have made their business based on 3Com and what they needed was more to be able to understand the reasons for the changes because a lot of the changes probably made sense at the high level but did not make sense for a given partner. One thing I'm instituting is a higher level of communications throughout the company, and the time I'm spending here with resellers and partners is an indication of how I'd like us to operate as a company.

CRN: What does that entail, this higher level of communications?

MASRI: Just becoming more available.

CRN: Personally, you mean?

MASRI: Personally, but also across the company. When a change does come, it should not come as a surprise to the partner. It should be communicated to them before hand, their input should be solicited and even if at the end of the day we are implementing a change that may make sense for the many but not for some, that the some are being made aware of the change and the reasons for it.

CRN: What's been the most common critique of 3Com you've heard from partners here?

MASRI: They have been eager to hear how we are converging our voice platform. We have a very rich set of offerings on the voice side. And they wanted to hear our commitment to maintaining the air cover that helps them in their business when there is more of a pull than push. And third, that we continue the building of our back-end infrastructure. CRN: On the converging of your voice platforms, you're talking about bringing the NBX and VCX lines together?

MASRI: Yes, but it's more complimentary in terms of the offering, in terms of the feature set. The VCX is a full SIP platform. They want to be able to have SIP capabilities across the board, so I'm talking less about a product and more about a feature set It doesn't necessarily mean putting those capabilities on the NBX as is.

CRN: What was your answer to partners who were asking about that?

MASRI: On that, it was commitment to an IP network, commitment to SIP and the assurance that we're committed to all of the small and medium enterprise offerings.

CRN: So that convergence is on the roadmap?

MASRI: It's definitely there.

CRN: And then the second point you made about maintaining the air cover, what kinds of things are you looking at there?

MASRI: The marketing activities and the campaigns. I am directing more of our activities toward the channel, which is what I talked about in terms of commitment to the channel.

CRN: Are you planning for an increase in the channel budget for the coming year?

MASRI: I would say a balancing in favor of the channel. One month on the job, I haven't looked at the details of the budget, but my message has been clear when I talk about focus, alignment and accountability. Focus on the channel is very important.

CRN: Do you have an action item you're coming away from this conference with?

MASRI: Yes, several action items based on my conversations with the channel partners. Some of it I already knew and mentioned already, about the air cover for the channel. Another one that I'm hearing loud and clear is to get our message out, to be commensurate with our technological capabilities. They feel our solutions are very competitive, but on more than one occasion, they would love to see the world hear it more. There's also the question about our financial stability and strength of 3Com. I'm very proud of our balance sheet. We are very excited about our improving financials. They need to hear that more systematically ... We take it for granted that we are solid. The market needs to hear it more commonly.