Back in May, I shared the story of Hipskind Technology Solutions Group and their years of experience as a DellPartnerDirect channel partner. Since 2006, they’ve seen us evolve and have grown their business as we grew our channel programs, but there are some partners who’ve been with us even longer.
Ed McNamara, director of Communications and Marketing at SHI, shared their story with me earlier this week. He told me how SHI’s growth from a "software-only" regional reseller into a $4 billion+ global provider of information technology products and services with 25 offices across the US, Canada, UK, France and Hong Kong has mirrored Dell’s growth over the years.
With the recent close to Dell’s acquisition of Quest, it seemed a timely story to share more broadly here.
Ed, SHI began to partner with Dell even before we launched our official channel program five years ago. How did that come about?
SHI began to partner with Dell in the 90s, at the request of our customers, really. Our legacy is in enterprise customers and many of them wanted SHI and Dell to work together on their behalf. There really wasn’t a channel program then, so it took a lot of teamwork and coordination. This was 8-10 years before PartnerDirect — but, it turned out to be very positive.
After we added our Corporate sales division, targeted at small to mid-sized businesses, Dell’s launch of the PartnerDirect program really opened up Dell products and services to the rest of our sales team. Today, our revenue is almost evenly split between our Enterprise and Corporate divisions and Dell has grown that portfolio with us. From 2009-2011, we’ve grown our business with Dell from $59M to $145M – a 130 percent increase!
- In that time, Dell has made many acquisitions, six of them this year alone. What impact have you seen on your business through them all?
SHI has experienced tremendous growth ourselves in size and scope – without mergers or acquisitions. Dell’s acquisitions, however, have enabled us to expand our portfolio of products and services, which in turn, has helped fuel our organic growth. In particular, the expansion of SHI’s Corporate [small and mid-sized] business has been really huge for us.
SHI never gets too excited or too down when an acquisition is announced – we look at it like having a diverse portfolio in the stock market, aimed at long-term, steady growth. We’re still here and thriving because of our ability to offer a diverse portfolio. There have been changes in the industry, and we’ve wondered if some might be tough, but we’ve always found a way to deliver a combined solution.
- How has the integration of acquired channel programs worked to get to that solution?
It ranges and it really depends on the company being integrated. Quest Software, for example, is still being finalized, so there’s no material impact to our business now. We’re in “wait and see” mode. It will benefit us for Dell to commit Quest to being something that their channel partners are going to deliver. Traditionally, Quest had taken renewals direct but recently opened them up to the channel. We’re hoping that Dell retains that policy and leaves them with the channel.
But, the transition can take three to six months from acquisition announcement to the date of close and our support teams have told me that Dell has done well communicating change to partners during those times. We’re on the front line so customers are going to ask and we’re going to talk about it with them in quarterly review processes. And, when Dell acquires a new company, we’ll need to keep our customers informed, so it’s important that changes be communicated properly to us.
- What do you hear from your customers when you communicate these acquisitions to them?
On a hardware acquisition, our customers are not as apprehensive, but, on a software acquisition, if Dell acquires a company that might compete with another product (e.g., Symantec vs. AppAssure), then they wonder what that means for support on the product they use today. We have an advantage because SHI presents options to customers and we support their decision, so we can support them on whichever platform they choose. We can support customer choice either way.
- Beyond expanding your options to support those customer choices, are there other benefits to your business when Dell acquires a company?
Dell brings its reputation and its global brand. Quest for example, is a niche player with a good product. We currently partner with both Quest and Dell, but if Dell advances that technology this will absolutely be a positive for us. Quest alone didn’t have the same marketing power and brand recognition, so leveraging Dell’s reputation and global brand will help us sell those solutions.
- What advice would you give a Quest partner that hasn’t already been working with Dell and has worries about the acquisition?
Our advice is that, first off, the proof from a sales perspective is in the numbers and our numbers have grown [with Dell acquisitions]. We’re on pace to exceed $4B in overall revenue this year, which is different from smaller companies, but having a strong partnership with Dell will increase the portfolio for those smaller companies that can’t acquire new technology on their own. If they don’t have the capital or resources to acquire new technology – mergers and acquisitions are time-consuming and can put a strain on resources – it’s better to let Dell do that and then leverage their resources for it. As a channel vendor, you always want to be able to expand your offerings to the customer.