Lenovo To Kick Off New DCG Partner Program

**Editor’s Note: Click here for our most recent list of important channel-program changes you should know.**

Next month, Lenovo expects to host a sold out Accelerate Partner Conference in Orlando. About 1,200 partners will attend the April 24-26 event to hear company executives talk about products and programs.

In particular, attendees will learn more about the retooling of the Lenovo Partner Program, which highlights the vendor’s ongoing shift to the data center. Last year, for example, Lenovo rolled out StorSelect next-gen software-defined storage and an enhanced suite of its HX Series of hyperconverged appliances. The company also opened up a SPIFF program to all network partners in a push to sell select PC and data-center products. And, Lenovo also hinted about upcoming changes in its partner program.

And, just this week, Lenovo announced the DX8200D, a turnkey software-defined storage appliance, the latest in its SDS portfolio.

Channel Partners recently talked to Sammy Kinlaw, North American Channel Chief at Lenovo, about what partners can expect at next month’s conference and for their businesses in the upcoming months.

Channel Partners: What are some key things happening at Lenovo that partners need to know about?

Sammy Kinlaw: Most important is the opportunity for partners to take Data Center Group (DCG) sales and technical classes that lead to certifications and to learn more about the April 1 launch of the new Data Center Program and classifications. Also on April 1, our new fiscal year, we unveil our new incentive stack. We’ll also be talking about our new PC products on the Intel Kaby Lake platform, and opportunities in workstations and servers.{ad}

CP: Would you elaborate on the data-center program?

SK: Yes, because it’s extremely important in our evolution from our System x acquisition from IBM. We’re in our ninth quarter since acquiring that business. During that timeframe, we’ve made lots of refinements and we’ve certainly refined our strategy, which is to make the most reliable, secure x86 architecture products in the industry. With that we want an ecosystem of partners that surround it — whether we’re talking Red Hat, Nutanix, Pivot3 … our goal is to make and provide the best hardware surrounded or associated with the best leading software-defined vendors.

Now we’ll talk about how that mission works in the partner community.  We’ve preannounced this but now it’s coming to fruition … we’re announcing a tiering structure for our partners. The tiering structure is based off of revenue and …

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… technical/sales certifications. The levels are Silver, Gold, Platinum — from lower to higher with increased revenue thresholds and required certifications.

CP: Tell us more about the overhauled program.

KC: Lenovo’s heritage with our value-added reseller community of small partners is incredibly valuable to us, and frankly, has been the biggest growth engine in the channel for Lenovo for two years running. So all partners will still have the opportunity and be afforded the ability to earn rebates and have eligibility to special bids combined with distribution.

[Up until now partners could be Lenovo authorized and there weren’t any certifications.]

All of our authorized partners in North America, about 30,000, will be in the Silver category. As you move up the stack to the Gold level, it’s going to require at least $3 million in revenue and a designated number of certifications. To move into the Platinum level you need to have at least $10 million in revenue and additional certifications.

The program is designed to be very line of sight, straightforward, easy to follow as to how you get in and what the benefit statement is.{ad}

Simply, Lenovo wants to pay for growth and acquisition and we’re going to reward partners that have unique designations and qualifications, and we’re going to reward partners that are loyal and willing to invest the time and with that comes more revenue stream.

CP: What are you expecting to see in terms of partners transitioning into the new program?

SK: We’ve done a look back so we already know which partners fall into which qualification/classification. In six months we’ll see if there’s movement and if partners have moved up the stack  so basically two times a year they’ll be able to move within the program.

It takes time to grow a DCG business and we want to reward partners who do that and we want to give partners our sense of awareness about their time and commitment. We also want to give our end-user community a sense of who has walked hand in hand with us, who understands our products, processes … our engineering.

When I preannounced this program on Jan. 1, I wanted to give partners the opportunity to get ahead. So we’ve already given out more than 130 certifications — taken over the last nine weeks. There [are] about 10 certifications that are already out and they’re a mix between tech certs and sales certs.

On the horizon are certifications in high performance computing (HPC), hyperconverged, Lenovo storage and networking, etc. … this is ongoing education for us. We plan on announcing …

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… new certifications quarterly that partners can take.

CP: Clearly, there are big changes going on at Lenovo.

SK: Yes. Looking at the DCG, the quarter ending Dec. 31 was a milestone quarter for us because we returned to year-on-year growth. It’s been a decline for us, a struggle, and we’ve lost big account names over an eight-quarter period.

But with new leader Cliff Gumkowski [vice president and general manager DCG Solution Sales since April 2016; prior to that he was with Dell for 15 years], we’ve been able to refine our data-center efforts by building out dedicated DCG sales teams. We learned that you have to have DCG specialists – for corporate, for public sector, for channel – and specialized learning for that marketplace. And, we brought back headcount dedicated to that mission. So last quarter was a return to year-on-year growth and the current quarter is yielding a trajectory that shows year-on-year growth, so specialization is where it’s at with DCG.{ad}

CP: What about the broader Lenovo business?

SK: Looking at Lenovo’s PC business, our North America business accounts for [almost 15 percent] share; that’s a[n approximately 2 percent] share increase year on year.  We’re one of the big vendors, and with about 15 percent share, we’ve got many quarters of growth opportunity ahead of us. Growth is still a tenet for Lenovo; it’s not a secret that we want to grow to 20 percent within the North American geo.

For our partner community, they want to know how we’re going to get there and what we’re going to do. With 42 percent share in the commercial channel, I’m entrenched in many areas. To grow, I need to understand where we’re under-indexed and we have to double down our efforts. Today, I can tell you I’m going to be pushing our workstation business – Lenovo has an entire platform of mobile and desktop workstations where we can compete in the commercial market against any manufacturer – and we’re under-indexed there so I expect to take double-digit gains in share for workstations. I’m looking to grow our desktop business – as surprising as that might sound – and I’m going to be driving our services business around the box services such as extended warranty, and keep-your-drive service offerings, that kind of thing.

In the mobile market – the Chrome market – according to NPD, we’re No. 1. The problem we have with Chrome is the realization it’s driven by a cheaper OS and average unit revenue. I like the door-opener that Chrome provides, but Lenovo absolutely has to focus on the premium product market – our X1 Carbon, X1 Yoga, our T series and ThinkPads – and I’m going to incent partners in a heavier way.