If you believed all the hype IBM put out last week at its Business Partners Executive Conference, held in Miami, Florida, you?d think that everything was rosy at the world?s biggest computer company.
If only that were true. Although IBM chairman Lou Gerstner told the 7,500 business partners from across the world that he will offer them new incentives, the fly in the ointment may well prove to be the channel staff at Big Blue itself.
This comes exactly one year after Gerstner?s speech at last year?s BPEC in San Diego, when the message to the reseller troops was clear and unequivocal. So much so, that a vox pop conducted at the time failed to find any trace of dissent in the ranks.
But last week, insider sources at IBM revealed that there was dissatisfaction within the company itself. Big Blue?s channel division, originally set up as a storm trooper to breach internal defensiveness from the old guard, now finds itself frustrated at every turn.
Although Nick Coutts, who heads the European channel group in Paris; Mike Lunch, who is the managing director of the IBM PC Company UK; and Steve Voller, UK channel manager, continue to fight the good fight in an attempt to turn round the hardware giant?s fortunes and make it compete far more aggressively with its rivals, the word is that they are losing the battle.
When Barry Morgan resigned as UK country manager over a month ago, it was the first time ever that outsiders were brought in to run the ship. There is a reason for that. Sources at IBM claim that the UK?s poor sales figures are disguised by manufacturing at Greenock and Hursley.
Nor, said one source, will the company grasp the nettle. ?I would like to know why IBM is not pushing NT more,? he said. ?Even though it lacks some technology capabilities, the fact is that it is winning market share and political problems within IBM are preventing the company realising that.?
Those political problems, he claimed, are compounded by the old guard at Big Blue, which prevents Gerstner from ever understanding the machinations happening lower down in the hierarchy. The source added that Ned Lautenbach, an IBMer of the old school, was promoted to a very senior marketing position within the company, which prevented the channel staff Gerstner appointed from achieving very much in the organisation.
There is still severe competition between the different divisions of IBM, said the source, whether it be RS/6000 machines, AS/400s or even IBM PCs. ?It would be logical if IBM just said that it can run NT on AS/400s,? he said. ?But that will never happen because people are still confused about hardware and operating systems.?
The situation came to the boil just before Christmas last year, when Peter Crane, headhunted from Novell to handle pan-European distribution for IBM, quit the company after six weeks. He was led to believe that his brief was to push channel ideas into the European market, but frustration apparently made him leave.
An IBM representative confirmed that Crane had resigned, but said the matter was still in the hands of the legal department so he could not comment any further.
The latest gaff, in the eyes of Big Blue?s channel division, is the appointment of Ingram Micro as a pan-European distributor, a deal which will allow Ingram UK to sell RS/6000 kit here. ?It has no channel,? said the IBM source.
Even though UK distributors Bytech Systems and CST have had the opportunity to build up their own channel for the past four years, when Ingram gets serious about this business, the RS carpet could well be pulled from under them.
The NT operating system continues to be the thorn in IBM?s side. Different forces within the company are still pushing OS/2, primarily as a cross-platform thin client for its network computers. But these, the source said, have also suffered from the politicking at Big Blue.
Because Gerstner pushed network computers so strongly at Comdex 95, he managed to create a whirlwind effect within the organisation. But whirlwinds cause devastation and the ructions in IBM are waiting to happen.
Yet, on the face of it, all seems well. Gerstner, talking to the partners in Miami last week, was ebullient about their future. As part of offering additional incentives, Gerstner claimed that ?rich opportunities lie ahead for the company?s business partners?.
The company rolled out its authorised assembler partners (AAP) programme enabling authorised firms to offer customers build-to-order PCs to compete against the direct vendors. Big Blue also introduced a reward scheme which allowed one per cent of the revenue business partners make from IBM sales to be used for joint marketing programmes with the manufacturer (PC Dealer, 5 March).
The overall response to IBM?s incentives was one of caution. Many dealers were still left feeling uneasy about the future ? although on the positive side, resellers said that at least it showed that Big Blue was listening to their concerns. What IBM actually does about it, remains to be seen.
But in the meantime, the creeping disease of interleaved management continues, and the ball is firmly in IBM?s court to sort out the internal politics and position itself to regain the lost ground on its rivals.
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