3Com adamant it is bucking the trend

Networking vendor 3Com has spent a long time in the Middle East enterprise IT market playing second fiddle to Cisco. Although the status quo is unlikely to shift anytime soon, Hemayun Bazaz, regional channel manager at 3Com, feels the financial crisis might just play in its favour and leave the company in a healthy position.

  • E-Mail
By  Julian Pletts Published  March 11, 2009

Networking vendor 3Com has spent a long time in the Middle East enterprise IT market playing second fiddle to Cisco. Although the status quo is unlikely to shift anytime soon, Hemayun Bazaz, regional channel manager at 3Com, feels the financial crisis might just play in its favour and leave the company in a healthy position.

You recently revised your partner programme. How has it changed and which specialisations will reap the most dividends for the channel right now?

All business goes through the channel without exception. Involving them at really early stages means margin opportunities are better. What we give back is 3Earnings, a reward dependent on meeting growth targets. Every partner doesn’t need to specialise in every vertical. They could choose one specialisation to focus on.

Is this the right time to be setting targets for partners?

3Earnings is target based. But the target is entirely dependent on the partner’s performance over the last six months.

Does that mean you will change the strategy if partners struggle to grow as fast as they have done the previous six months?

No. 3Earnings are target-based. These targets revolve around achievements in the last six months. We average that out and then put in place a target.

So what happens when a partner complains they are not going to be able to meet the targets?

This time is the opportunity for us to actually grow. The global economic downturn has worked in our favour and we have seen a growth in revenue because most of the customers are moving towards vendors that provide value and we are the only other company that provides end-to-end solutions which are cost-effective. Partners are actually seeing revenue growth in their business if they are partnering with 3Com. Therefore, we are looking at growth in 2009 and our partners are seeing that as well.

The programme includes additional services that partners can capitalise on. What are they and what investment does it take on the partner’s behalf?

These are the services that we provide directly or through partners. Yes, there is investment in that the partner has to have technical people who are able to deliver services. But the return on investment is huge.

What sort of revenue can a partner expect from reselling those services and how significant is it to the development of their business?

It helps them make more money and be closer to the client. They are services that keep clients happy and loyal to you, rather than just the products you deliver. It is very important to keep a customer loyal.

So what percentage should it be of a partner’s business?

I would suggest at least 10% of the revenue that a partner makes should come from services.

Are you doing anything to try and attract nervous Nortel partners?

We are not attacking Nortel but for any channel that wants to do business with us, this is the time where we see opportunity and our end-to-end solutions are seeing more demand. We are going to every vendor channel, not just Nortel, but Cisco, HP and Avaya.

Cisco is dominant in the market so how can you challenge them and attract partners to 3Com?

We offer better margins for partners and give them a better chance of success with the customer. We involve them from the very beginning and because of this the chances of creating margin opportunities are greater.

Our products are cost-effective and not as expensive as Cisco, which offers another chance for the partners to create margins. There is a lot of channel competition as far as Cisco is concerned. With us, competition within the channel is minimised.

If the financial crisis is proving beneficial for you that must mean that you have high growth targets in place for 2009?

We certainly have growth targets. Our year starts in June so we are going into the last quarter of the year. How high our targets are next year remains to be seen.

What are the targets for your fourth quarter then?

These have been planned since the start of last year. We haven’t changed this and the climate is favouring us to achieve and meet these targets.

Are you planning to increase your channel base to ensure that you meet these targets?

Most definitely. And it is not only increasing our channel, we are also hiring within 3Com. We need to expand our channel, not only in the UAE but in the other Middle East countries as well.

Why are you in such a position when other firms are not?

We are cash rich. That is one reason. We are winning business and customers are moving to 3Com.

Add a Comment

Your display name This field is mandatory

Your e-mail address This field is mandatory (Your e-mail address won't be published)

Security code