Secret Agent Man

By Khali Henderson

THERE ARE VARS and there are VARs. CDW is one of the countrys largest. And with 2006 revenue of $6.8 billion, it is one of the countrys largest companies No. 343 on the Fortune 500 list. If you are in business, youve no doubt heard of it and you might even be a customer. If you are in the technology business, you almost certainly are a competitor. CDW sells all manner of computer hardware and software. Thats only its legacy product line, which dates back to its founding in 1984. Since then, you wont be surprised to learn, it has gotten into selling complementary gear for data networking, security, storage and telephony along with associated professional services. What may surprise you is that among the 1,200-plus brands CDW represents are network service providers like AT&T, Sprint and Global Crossing.

They are probably the largest agent that youve never heard of, says Henry Kaestner, CEO of Bandwidth.com, a reseller of voice, data and managed network services. Bandwidth.com has been selling carrier services through CDW since 2003, and says it is by far the companys largest VAR partner, pushing close to a quarter million dollars of business every month.

CDW, a public company, is tight-lipped about its carrier services revenue but says its one of the fastest-growing segments of its business with year-over-year gains ranging from 30 percent to 60 percent since 2001. Thats when the company focused its sales and customer service machine on carrier services as part of a corporate initiative to help its primarily small and midsize business customers design and select advanced technology solutions. Several technology specialist teams were formed to provide expertise in specific areas such as telephony, storage, security, power, network design and software licensing. Becoming a carrier services agent was an extension of that strategy, says Ian Kieninger, general manager of carrier sales for CDW. We were successfully selling the products that were literally plugging into carrier networks.

That logic in and of itself was not enough to send CDW rushing headlong into the carrier services fold, where it was sure to encounter a culture contrary to its own, which is based on speed and hightouch customer service. Its tagline, after all, is: The Right Technology. Right Away.

What tipped the scales was customer outcry. Recall that this decision was being made during telecoms nuclear winter when carriers were laying off staff, resources were shifting to top customers and SMBs were not telcos priorities. This was an opportunity to get involved and service our large base of small to medium-sized customers, says Kieninger.

Kieninger was recruited by CDW in 2003 to head up the carrier sales group. Previously, he was the AT&T channel manager responsible for the CDW account and was one of the advisers that helped CDW develop its offers and processes. CDW is intent on creating a first-class telecommunications buying experience for SMBs, says Ken Grimsley, vice president of strategic sales at CDW. Ians AT&T experience and channel relationships along with his customer-service focus made him a natural fit to play a key role in helping us accomplish this goal.

Kieninger says his carrier experience has been helpful to CDW in understanding how to interface with behemoths like his former employer and, conversely, in showing vendors how to work with CDW.

What his experience did not prepare him for was the pace of CDWs sales and service environment. CDW moves so quickly. We deliver technology right away, he says. So, we are trying to adopt that philosophy in telecom.

This means same-day or next-day quotes and designs, and real-time access to account status and billing information. Getting suppliers on board is a challenge, Kieninger admits. To indoctrinate them, channel managers are asked to shadow CDWs voice and data account managers to better understand the time pressures they are under. I am trying to share that culture. It is a challenge, he adds.

Bandwidth.coms Kaestner believes that this emphasis is key to his companys relationship with CDW. [CDW] realized early on that their core competency was building great customer relationships, says Kaestner. They also had really smart telecom sales guys on the floor. What they didnt have was a telecom OSS. Bandwidth.com provides CDW with quoting, order status and trouble-ticket systems for products such as T1s, SIP trunks and VoIP for multiple carriers.

Ian has done a great job of working with us and trying to help us make our systems even faster than they are. He is always lobbying for that, says Kaestner.

At the same time, Kieninger is lobbying for his carriers to adopt CDWs culture, he and his team are evangelizing the carrier services products to the account managers on sister specialty teams and with the sales reps who take orders for gear. Ian has done a great job of building awareness within a 2,000-person sales organization that CDW doesnt need to be just a box seller, says Kaestner, noting he has on-site staff supporting CDWs carrier sales teams efforts at internal education.

With so much attention focused inward on CDWs vast customer base, its no wonder CDWs carrier sales group has gone under the retail radar screen. All marketing efforts have been to generate leads from within the base leveraging one-on-one customer relationships and, to some extent, in-packaging fliers. If you are determined, you can find the carrier services offers on the company Web site (its under Networking/ Voice & Data). A bevy of some 30 referral agents is the primary contact the group has with the outside world. Outward advertising, such as the companys TV commercials, have yet to feature carrier services. Mention of a BlackBerry device in a recent campaign has left Kieninger hopeful that the long silence soon will be broken.

With more than 3,000 wireline contracts in place and a proven leadgeneration process, there seems to be little incentive for CDW to crank up the volume. Case in point: CareerBuilder.com. The online job search center has been a CDW customer for about seven years. At year four, it learned of CDWs voice and data services and in year five decided to take them up on the offer by specifying an MPLS network connecting its remote offices that were newly outfitted with Avaya PBXs. CareerBuilders IT manager, Ron Hayman, says, We had a lot of success with them in the hardware area with delivery and them introducing us to new technologies and options. When it came to this, we went to them to find out what options were available.

The design, which leveraged Global Crossings VoIP network, saves the company about $500,000 annually and enables it to offer local customer service numbers to customers no matter where they are in relation to CareerBuilders 33 locations. The implementation earned CareerBuilder accolades from Computerworld Magazine, which named the company a Computerworld Honor Laureate in this years Honors Program recognizing information technology companies.

CareerBuilder is the quintessential portrait of a CDW customer, which has been won over one technology specialty at a time. Since its carrier services contract went so well, it has since turned over its PBX business to CDWs telephony specialty team. And, says Hayman, They provide great value and were looking for further opportunities to extend our spend with them.

CDW is only too happy to oblige. Its platform, which supports multiple disciplines with deep product knowledge, feeds right into the current business technology migration toward convergence and enterprise mobility. A Custom Services Organization coordinates among the specialist teams, including the carrier sales group, to bring end-to-end solutions together. There are always a lot of projects that tie into what we do, Kieninger says.

Thanks to demand for ubiquitous, always-on connectivity, it seems the relative anonymity of CDWs Carrier Sales Organization might soon be compromised.

Cover story photos by Wendy Morris of CDW