Hewlett-Packard Co. made big changes to its flagship PartnerOne program at the HP Global Partner Conference 2013 in February, when it announced it would pay partners from the first sale and uncap earning potential for rebates. Yesterday HP announced another round of changes that company officials said are designed to accelerate growth and profitability for its 30,000 participants -- and make it easier for partners to differentiate themselves.
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The company plans to accomplish this by simplifying the PartnerOne compensation model, standardizing on membership levels across all regions and HP business units, and cutting the number of certifications it offers to partners.
In an email exchange, Patrick Eitenbichler, director of marketing for HP PartnerOne strategy, elaborated on the latest round of changes, which are effective Nov. 1.
How would HP prioritize the changes announced on Wednesday in terms of significance and why?
Patrick Eitenbichler: For partners, profitability and predictability are equally significant. With the new enhancements, HP PartnerOne will become consistent across all regions and multiple HP business units: HP Enterprise, HP Software and HP Printing and Personal Systems (PPS).
There is now an easier, more intuitive membership structure; a more consistent and profitable compensation model; and streamlined certification requirements.
How exactly have the membership levels changed? What is new?
Eitenbichler: In the past, HP featured different membership structures depending on HP business unit and region. The company's promotions of partners to HP customers and new business prospects also varied, and customers at times did not have visibility into HP partner certification and membership levels.
The new HP PartnerOne membership structure will be consistent across multiple HP business groups, offering a clear path to new Specialist designations. These changes will also make it easier for partners to differentiate their business in the market, regardless of whether they operate on a value or volume business model. HP will also actively promote its top partner levels in end-user customer marketing campaigns.
Metal designations are universally understood. The new Platinum, Gold and Silver terminology clearly differentiates membership levels, making it easier for customers to understand partners' capabilities.
The single, unified global program also makes it easier for global HP partners selling around the world to streamline their engagements with HP.
What exactly were the core compensation enhancements that were rolled out in May? And how is compensation enhanced with Wednesday's announcement?
Eitenbichler: The financial benefits will be significant for partners selling end-to-end HP solutions. Platinum Specialist profitability is expected to increase 20 %, with the average deal size in the U.S. expected to double to $300,000 compared to Gold Specialist partners.
HP expects within the next two years to drive approximately 300 partners in the U.S. to the Platinum Specialist certification.
HP will announce final revenue thresholds and benefit rates for the new PartnerOne tiers in October 2013. Later this year, HP also plans to make additional PartnerOne enhancements intended to drive partner sales growth for 2014.
Please provide more details on the streamlined certification process. How many specializations does this streamlining pertain to, and what are the details?
Eitenbichler: HP believes that specialization is the best way for partners to differentiate themselves, create additional customer value and increase margins. We've simplified the Specialist designations by creating a common set of requirements across multiple business unit designations. By offering specializations across the HP portfolio, HP channel partners can choose the specializations that best meet their growth and customer requirements.
In the enterprise group, for example, HP's certifications will be reduced from 42 to 22. In HP's server group, certification will be reduced from 10 to three.