IBM fights downturn and Oracle threat

IBM might be an industry heavyweight, but that doesn’t afford the firm and its partners automatic shelter from the storm. This is the time a calming voice is most needed to soothe the worries of the channel. Recently-installed director of global business partners MENA and Pakistan at IBM, Jean-Christophe Knoertzer, does his best to extinguish channel fears over, not just the recession, but also the prospect of a fresh gauntlet with Oracle-Sun partners

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IBM fights downturn and Oracle threat
By  Julian Pletts Published  June 5, 2009 Channel Middle East Logo

First off, you have just joined IBM in the Middle East as the business partner director — are you new to the role?
I am new to the role in the MENA region. I used to hold a similar position in France, running the business partner organisation for France and Northwest Africa at the time.

How about the structure of IBM’s channel here, is there anything localised about the way that you will tackle the channel in the Middle East?
There are some very specific features in our channel structure here. Firstly, we have a unique relationship with two business partners in the region, GBM for the Gulf countries and SBM for Saudi.

Your have a long relationship with GBM, but they also work with additional vendors these days. How does that affect dynamics?
They are working with a number of partners and the contract is very specific in the sense that there is some recognition from them not to promote vendors competing with IBM. [GBM] is exclusive for some of our product range so this has an implication on the role they are playing and the fact IBM is not making a direct transaction for this product. I don’t know every channel construct in each global IBM market but this is the only one where this is the case. The second reason we have this specific channel strategy is that in the MENA region there are a number of countries where there is no IBM presence. For instance, we are not in Libya and the only route to market is through our business partners there.

Have you had to alter your partner targets as a result of the financial crisis?
Our targets are very simple. We have an IBM plan and the chairman has made very clear statements about the commitment in 2009. We are going after targets in line with that plan.

How do you measure targets right now — based on what?
Based on history and based on growth that we want to achieve. We have a normal mechanism to do that. I hope that one of the contributions that I am able to bring to this region is that I know this programme very well. In some countries in this part of MENA it is not fully deployed and one of my goals is to ensure we deploy more aspects of the business partner programme in these countries.

We have been hearing a lot of channel players complaining about late payments and projects being postponed. What sort of support do you offer channel partners that find themselves in this situation?
We don’t have a specific, generic plan for that. It is more of a case- by-case issue. We speak about big projects and sit with the partners to talk about the delay and understand the dynamics of each deal, the incentives and other back-margins that will allow everybody to be happy. It is not the case of saying, “because of the crisis customers are paying in 90 days instead of 60, so IBM is going to extend.” It is more about taking each case individually and making sure partners have a viable model. We want our partners to survive and prosper and be strong.

Should IBM partners be worried about coming up against renewed competition as a result of the recently-proposed Oracle and Sun Microsystems merger?
They should be very happy to realise everyone is doing what they’ve been doing for years, to have an integrated business model. Everybody has copied our strategy of being integrated in front of the customer. It is easier to be integrated when it is coming from the same company.

Is there an argument for a greater IBM presence in terms of going to the customer with the partner right now?
I don’t think so. It is not linked to the crisis. We are always happy to go with our business partners to the customer and we will always do that. We also believe it is smart to have our business partner doing their work and when they need us to make a customer call together, we do it. I have not seen such things these days. Maybe the customers are more confident with solutions from a well-known vendor like IBM and its business partners than someone that is a bit weaker during this recession.

Can we end on your best advice for business partners?
For me it is very simple. The partners that are going to survive are the ones that have skills — skills in the market, architects and capabilities to deliver any project on time. Make sure you have the skills and you will win.

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