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  1. Technology
April 8, 1996


By CBR Staff Writer

IBM has a new policy for its AIX channel partners. We will no longer, screw the business partner says Mark Bregman, general manager of the AIX division. Admitting that although the division performed well financially and in terms of market share last year, it failed to deliver to users, according to Bergman, the division’s third head in the last two years. Previously Louis Gerstner’s technical adviser, he believes the division must improve its internal processes and expand its channel relationships. There are a number of issues facing the RS/6000 division. Some of them are tactical and some of them are strategic. The most pressing issues at the moment are tactical. We must improve our reputation as a supplier and not just by telling people that we are a reliable supplier. We must build a reputation as a reliable supplier. This means we must resolve the supply issues that customers suffered through last year and continued to suffer through the first quarter, he says. Bregman attributes the problems to higher-than-expected demand, coupled with a shortage of components in the industry and a lack of discipline in IBM internal processes. We missed development schedules, and even with announced products, we could not fulfill customer orders. We are still struggling in the first quarter to recover from this. We have to do a better job of understanding demand, forecasting to it, planning for it and managing the suppliers, so we don’t get behind again, he says. Key to improving IBM’s service, Bregman believes, is improving the company’s relationship with its business partners and channel. In response, IBM has published the Business Partners’ Charter, which sets out IBM’s commitment to the channel and aims to push more business through the channel. Going back for a long time in IBM history, our view of business partners was, in my opinion, wrong. We looked at business partners as just another channel in the mostnarrow sense – another way to get to the marketplace. We used them to multiply our number of feet on the street, not from the perspective of them adding value. Furthermore, we tended to look at a business partner and see how we could use him to maximize our revenue. The motto was ‘Screw the business partner, what can I get’. Of course, that doesn’t endear you to business partners very much, he says. We have really changed our whole mindset to ‘What can I do to make you successful?’ Because if I make you successful, then we will be successful. Lars Alm, general manager for IBM AIX EMEA says, My priority for this year is to refocus or business we do together with our business partners- since the launch of the RS/6000 in 1990, business partners have been crucial to us. We have been growing at 25-30 per cent a year in terms of revenue, but we have done that without adding a lot of people internally. The expansion has been taken through an external network. And the AIX division is looking to aggressively expand business through business partners. IBM’s target this year is to do 60 per cent of all AIX business through business partners, rising to 70 per cent next year and Alm expects all RS/6000 clients and low-end workgroup servers will be sold through distributors within the two to three years. The total expansion we are planning this year will all be handled through this channel, says Alm. Getting to this 60 per cent is an absolute must if we are going to achieve our total this year. In order to emphasize this movement we have changed the way pay people in IBM. If you do business together with a partner, whether it is within my division, the AS/400 or the enterprise division, you get more compensation on that transaction than if you did it directly with the customers themselves, he says. We have recognized our own limitations and the opportunities to do business if we extend our reach and include our business partners. Alm believes that with this focus on business partners, users should see added value in systems proposals, including more third-party services, support, software andintegration. People pref

er to deal with the business partner rather than IBM and that is exactly the way it should be, says Alm. Even if we think we are big we are very limited compared with the opportunities in the marketplace. And we should help the business partners to build the right sort of relationship with their customers. But at the same time, IBM says it will continue to survey customer satisfaction levels and address any problems.

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