HPE Worldwide Channel Chief Paul Hunter said the coronavirus pandemic has HPE looking at every aspect of its channel sales offers and processes to see where it can become more efficient to help partners get through the economic downturn caused by the crisis.
“In response to the situation we find ourselves in, we are looking at how we can help our partners manage through the uncertainty,” said Hunter.
HPE’s commitment to building highly profitable partner relationships in both good times and bad times is part of the company’s rich partner legacy, said Hunter.
HPE has been keeping in close touch with partners, with North America Channel Chief Leslie Maher holding a weekly 30-minute call with partners. “That has proved to be very valuable,” said Hunter.
Hunter, for his part, said the “rallying cry” as HPE tackles the partner financial challenges surrounding the coronavirus pandemic is to be “flexible” and adjust to the new normal. “We will come out of this as better, healthier, stronger companies,” said Hunter. “The fittest will continue to prosper. This will make us a better company and it will make our partners better.”
Suspending Revenue Thresholds For HPE, Aruba Through 2021
Both HPE and Aruba have suspended partner revenue thresholds in the wake of the pandemic.
The revenue threshold relief ensures partners will stay at the same level in the two Partner Ready programs for 2021 even if they do not meet revenue commitment levels.
“Partners are facing an uncertain trading future for the next six months and they don’t want the additional uncertainty of not knowing what threshold they are going to be and what membership tier they are going to be in for 2021,” he said. “One of the foundations of our relationship with our partners and our program is establishing the principle that they can invest in the long term with us.”
Hunter said it is crucial that partners continue to invest as they transform their business and customer relationships for an as-a- service future. “It is difficult for them to do that if they can’t plan for the year ahead, so we made the decision to suspend the revenue thresholds for this year,” he said.
All Platinum, Gold and Silver partners will retain their current membership tier benefits even if they do not meet revenue commitments, said Hunter. “It just helps reduce the ambiguity and uncertainty that partners are facing,” he said. “That in turn helps them make investment for the medium and long term and also helps them concentrate on the short term—capitalizing on situations where IT is critical.”
At the same time it is suspending revenue thresholds, HPE is stepping up training and certifications with a prime focus on the GreenLake pay-per-use consumption portfolio, said Hunter.
Hewlett Packard Enterprise Financial Services US$2 Billion Payment Relief Program
HPEFS’ US$2 billion Payment Relief Program, which allows customers to defer over 90 percent of the total contract value of products and services until 2021, is helping partners close sales with customers grappling with the financial fallout from the pandemic.
In fact, Hunter said the HPEFS program is helping partners win deals that were being delayed or deferred. “We’ve seen significant uptake on the [HPEFS] financial offers,” he said. “The level of interaction, the number of quotes and the activity being driven by the Financial Services team is an order of magnitude greater than it was two or three months ago. This is a time when having your own Financial Services arm really comes into its own. We have got the flexibility and capacity to change our offers, which is what we are doing to help our customers and our partners.”
HPEFS is also providing 90-day delayed payment on new HPE technology purchases as low as US$5,000 as part of its coronavirus relief initiatives.
This three-month payment deferral option applies to a range of HPE hardware and select software, software appliances, services, and installation packages.
Last but not least, HPE is also proactively working with customers hit hard by the crisis with “forbearance” programs. Those programs, which allows customers to temporarily stop making payments, will be implemented over the next 90 days.
Helping Smaller Partners With Extended Distributor Payment Terms
HPE is providing dramatic financial relief to distributors aimed at helping small- and midsize-business-focused partners.
The distributor “liquidity” initiatives include providing extended payment and early payment discount terms. The cash relief offers run from May 1 to July 31.
HPE also extended payment terms from 60 to 90 days for distributors in North America and Europe participating in “factoring” programs.
Finally, HPE suspended or significantly reduced strategic development initiative targets for distributors in most geographies. That guarantees distributors get a payout starting from US$1 at or near the full percentage rebate.
All of the distributor offers include both HPE and Aruba, said Hunter.
Those cash relief offers for distributors required additional investment from HPE, said Hunter. “We have had support from [HPE CEO] Antonio [Neri], our CFO Tarek Robbiati and our [Hybrid IT] President Phil Davis to make additional investments in Q3 to help improve the liquidity of our distributors,” said Hunter. “That allows them to help our small partners, who I think are the most vulnerable. Just as with the U.S. economy, small businesses are more vulnerable than the really big, well financed businesses. … The small partner base is very important to us.”
The distributor assistance is going to have a trickle-down effect on partners, said Paul O’Dell, a director at CPP Associates, a Clinton, N.J., HPE Platinum partner. “That is going to have a snowball effect,” he said. “If HPE provides some leniency on distributors, then that is going to be passed on to us and then to our clients. Anything that allows us to provide customers with extended terms is a big deal.”
GreenLake As-A-Service Midmarket Offers
HPE has developed additional preconfigured GreenLake pay-per-use midmarket offers aimed at driving more recurring revenue for the channel, said Hunter.
The preconfigured GreenLake as-a-service midmarket offers are priced at US$100,000 to US$300,000 over multiple years.
One of the preconfigured offers that is resonating with customers is a GreenLake Nimble flash storage as-a-service offer with InfoSight predictive analytics software, said Hunter.
In fact, Milestone Technologies, No. 287 on the 2019 CRN Solution Provider 500, recently leveraged the Nimble offer to win a state government deal, according to Hunter.
“The U.S. is leading the pack with regard to the sales of the midmarket offers,” said Hunter.
The GreenLake pay-per-use model is resonating with customers, said Hunter. “Customers get incremental capacity and they don’t have to invest ahead of the demand, which is often the case when making a capital expenditure on storage and they move to a charge-for-usage model,” he said. “And they are able to do so in an extremely demanding time frame.”
GreenLake is gaining momentum among partners who are anxious to build recurring revenue streams, said Hunter. “Those partners that are building GreenLake revenue streams with us are having great success,” he said.
Among the partners in North America gaining traction with GreenLake is Rolta Advizex Technologies, which was selected by CRN as an MSP Elite 150 company, said Hunter.
Hunter commended Advizex for building a robust consumption-based business. “They are really one of the leaders delivering solutions that are helping customers and also changing the financial profile of their business,” he said.
Advizex recently won a major GreenLake as-a-service deal for a major hospital system doing an Epic healthcare software implementation, said Hunter.
Hunter’s message to partners that have not gotten on the GreenLake bandwagon: “If you haven’t started on that journey, now is the time to start. I think we are going to be in a distressed economic situation for some time.”
New Virtual Sales Capabilities For Partners
HPE is introducing new virtual solutions aimed at helping partners close deals in the midst of the pandemic.
Those virtual sales capabilities include remote demo capabilities and remote assessments, said Hunter.
“Our tools portfolio, which we have been quietly adding to over the years, is really coming to the fore,” said Hunter. “It’s proven to be one of our strengths.”
Among the virtual offers are a no-cost, self-serve Demonstration Portal with prerecorded lab demos for partners and virtual tours of the HPE Briefing Centers.
HPE is also stepping up virtual offers for partners to build up their sales skills, including pay-per-use GreenLake sales training. A new HPE Learning Center is scheduled to roll out in May.
HPE is continuing the virtual sales offensive with its HPE Discover 2020 Digital Experience, which begins June 22.
New SMB Offers Including Free iLo Remote Server Management Software
HPE is helping partners drive server sales with free iLo remote management software for customers until the end of 2020.
The popular Integrated Lights-Out (iLo) software allows partners to configure, monitor and manage HPE servers.
In the past month, the downloads of the iLo software have “skyrocketed” as partners move to remotely manage servers, said Hunter.
“We are thinking about how to help partners with sales propositions for small and medium customers, starting with remote management and then potentially looking at security,” he said. ”Security is an increasing concern for small businesses.”
HPE is also eyeing new offers for connected experiences with the Aruba Wi-Fi networking product portfolio, said Hunter. “We’ve seen demand for access points and external Wi-Fi in high demand,” he said.
“We are working very closely with the Aruba team making sure that we’re presenting a complete portfolio that is seamless to customers,” said Hunter.