Corporate Affairs

There are a limited number of resellers capable of striking deals with the largest corporate accounts in the region. Channel Middle East explores the art of selling to large accounts.

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By  Stuart Wilson Published  October 2, 2006

Channel landscape|~|cafjd200.jpg|~|Justin Doo, managing director Middle East and Africa at Trend Micro|~|Identifying the top tier of corporate resellers in the US or Western Europe is a breeze. They have the most staff, an impressive client list, numerous testimonials and case studies and the support of all the major vendors. In the Middle East the situation is not always quite as clear-cut. The number of accounts in the Middle East that would be classified as large or enterprise accounts elsewhere in the world is minimal — and that’s according to some of the vendors with the biggest on-the-ground presence in the region. In fact, many enterprise-focused vendors contend that, with the exception of the public sector and telecoms companies in the Middle East, all other clients should be categorised as small and medium business (SMB) accounts. Despite the limited number of enterprise accounts in the region they continue to contribute a significant proportion of the overall IT spend. As such, vendors, integrators and service providers are continually looking to increase their enterprise business and make their role indispensable in the IT delivery model employed by the largest companies. For many of the largest enterprise clients in the Middle East, vendor involvement is a ‘must’ for any major IT project. “There are still relatively few resellers with the ability to reach into the largest accounts such as STC and Emirates,” commented Justin Doo, managing director Middle East and Africa at Trend Micro. “For many large government organisations, when they engage in a project, they are keen for the vendor to be sitting around the table as well. We will work with the large account and discuss areas such as service level agreement because many of these customers actually want vendor signoff on proposed projects.” While the channel will frequently view vendors interacting directly with end-users as a threat to their role in the delivery ecosystem, the vendors themselves are keen to point out that their involvement is always at the bequest of the customer. Hisham Essadi, director for channels and alliances at Oracle MEA, explained: “Oracle uses a hybrid model of direct and indirect touch for large accounts and corporate customers. Our first instinct is to use a partner-led model but typically it is the customer that decides. Clients in the public sector and telecoms space frequently have a preference to deal directly with the vendor.”||**||Drilling down|~|cafjh200.jpg|~|Joseph Hanania, managing director at HP Middle East|~|The quality and quantity of corporate resellers is a subject guaranteed to stir up a healthy level of debate within the Middle East channel community. Some industry insiders are quick to point out what they perceive as a skills shortage in the region and bemoan the lack of presence for many of the global IT services giants in the Middle East. Others are quick to point out that business in the Middle East still revolves around personal relationships and that this remains the driving force behind the delivery models used. Venu Menon, divisional director at Online Distribution, said: “There are already a number of skilled partners in the region but there is always room for more professional companies to set up in the Middle East. The amount of integration projects is growing exponentially in the region.” “In terms of the sheer number of integrators in the market the overall capacity is there but when you start looking at the ‘A’ and ‘B’ class projects — the real high-end implementations — there are very few companies that can actually carry these out,” he added. “We do need more skilled integrators in the region and we need to see a healthy level of competition between them.” The major vendors in the Middle East continue to devote significant resources to the development of their relationships with enterprise accounts. For vendor powerhouse HP, building a one-on-one engagement model with each and every large account in the Middle East remains a top priority. “From an enterprise point of view, Gitex is an important exhibition for HP because a number of our enterprise customers attend the show,” said Joseph Hanania, managing director at HP Middle East. “It is an advantage inasmuch as you can meet with them one-on-one. Enterprise selling lends itself to one-on-one engagement where you can discuss things in detail.” “For the enterprise customers we really look to drill down into the verticals in which they operate,” Hanania continued. “For each vertical industry — be it telecoms, media, financial services, oil and gas or airlines — there is a specific value proposition.” In the Middle East there are no hard and fast rules when it comes to deciding the partners and vendors that emerge successful from the tendering process. While the transparency and efficiency of the tendering system has improved in recent years, the value of personal relationships and working history cannot yet be totally discounted. Vendors themselves are acutely aware of the unique characteristics that are part and parcel of doing business in the Middle East. ||**||'Ambulance chasing'|~|cafvm200.jpg|~|Venu Menon, divisional director at Online Distribution|~|“There are very few systems integrators that can proactively create the desire for a project to happen within an enterprise,” added Doo. “That probably is a direct reflection on how business relationships occur in this region and who gets the final order.” “I hope that we will see the emergence of a clear top tier of corporate resellers in the Middle East,” Doo continued. “We need to stop the ambulance chasing that we currently see in the market where one partner spends a great deal of time and effort developing a project only to be undercut at the last minute as everyone else piles in and starts a margin war. We have also come across a situation where the customer wants a Trend Micro solution but they also want to use their preferred integrator who may not have the experience of implementing our solutions. On some occasions the partner may actually have a preference for recommending an alternative solution. In this situation it is vital to make sure that the solution is implemented and maintained in a professional manner and if you margin the partner correctly that should not be a problem.” Essadi at Oracle is also quick to point out the responsibility of the vendor to make sure that the enterprise customer utilises a skilled partner. “90% of all the services provided for Oracle in MEA are led, conducted and provided by partners — even for large government accounts. We have partners focused on the public sector in the Middle East that we will recommend to these clients.” “We can recommend systems integrators based on their skills and experience but it is the customer decision at the end of the day,” Essadi continued. “We are very concerned that clients use a skilled and reputable partner and we do outline the risks of using a company that does not have the necessary skills and certification levels.” Understanding the landscape of customers delivering enterprise level services and carrying out large account implementations in the Middle East is still far from easy. In addition to the indigenous companies — predominantly serving local clients — you also have a range of international players ostensibly serving the Middle East needs of their global customers. Menon at Online explained: “When you look around the region it is possible to identify many of the corporate resellers — especially those that are focused by vertical market. In the UAE everyone knows players such as Alpha Data, CNS and ITQAN and their strength in the enterprise segments. The same applies in other markets such as Saudi Arabia where names such as Jeraisy spring to mind.” As the overall size of the Middle East IT market increases, so too will the levels of segmentation and categorisation that can occur at a corporate reseller level. At present, we are still not seeing the efficiencies derived from the creation of regional players with a specialist skill that is sourced across multiple countries by enterprise clients. This is an advanced delivery model that the Middle East channel must move towards to serve the needs of the region’s largest enterprises.||**||

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