"Our targets for promotional schemes are realistic and planned in consultation with partners."

A genial Ravi Aggarwal is an HP veteran with 10 years already put in to make HP a channel-centric company. No wonder, under his leadership, HP walked away with seven different DQCI Channels' Choice Awards in 2000. Ravi's primary goal is to work in close collaboration with channels. A graduate of IIT, Delhi, Ravi has put to good use, his work experience at DCM Data Products and Blue Star, to rise up the career ladder at HP. He heads the sales organization that addresses both the enterprise and the channel. In an exclusive interview with DQCI, Ravi tells how HP is helping the channel to make more money. 

At a time when channel partners are experiencing shrinking margins, how is HP helping them to make money?

Making money depends on dealers and resellers; whether they want to focus only on selling products or add value to products and sell solutions. There is money to be made in selling solutions. We are trying to graduate our partners from

sellers of products to solution providers. 

We have opened up our service centers and invited partners countrywide to become our authorized service providers, to service products during and after warranty. We have positive feedback on revenue and earning potential from our service segment. 

We are also providing managerial education to all top resellers from a planning and strategy perspective. We help them plan their business to remain healthy from the financial point of view. We train them to present their business to customers in an effective manner. The turnover in this business can be so fast, that one can turn around money either five times or once every month depending on one's efficiency. Our effort is to make our partners efficient in managing their finances.

We talk to our partners on simple things like inquiry management and how to present demos. Using new processes, methods and joint programs, we want to make sure that our partners make money by increasing their volume of sales.

One of the things that contribute to higher volumes is the promotional scheme. At the same time, such a scheme aims at high targets and tends to kill the market, because partners resort to heavy under cutting. Your comments please…

Our targets for promotional schemes are realistic and are planned in consultation with partners. To the best of my knowledge, and from a planning perspective, we only take those numbers that we believe are realistic. We believe resellers have to be profitable. Otherwise you may get them for one scheme, or at the most for two schemes. For the third scheme, there may not be any participation at all. 

I know that resellers tend to take much stronger or bigger positions looking only at volumes and not profitability. But in our case, whenever dealers come back to us telling that their target is too high, we have agreed and acted very quickly to revise them. If we have to make an exception because we were wrong in our judgment, we certainly try to correct it. This is based on our long experience in managing schemes, partners and geographical growth. Most of the time, the HP team discusses the target numbers with partners by calling up meetings. Only when 90 percent of the resellers say that our numbers look okay, do we go ahead with a particular scheme. No HP promotional scheme is planned in a vacuum. 

HP is well known for introducing new products every now and then. At the same time, Indian users like to stick to their machines as long as he can. How do you handle spares and service in this scenario?

As per our internal guidelines, from the time we discontinue manufacturing a product, we keep producing spare parts for the same for five more years. I think this is a reasonable time period that we offer to our customers. Beyond five years, it becomes more expensive to maintain an old product and customers usually go for a new product. Any customer can sign five-year contracts with us. In any case, we offer a three-year warranty while selling most of our products. 

Where do you think the channel is heading in the Internet age? 

I believe that over a period of time, the Internet will play a stronger role in every aspect of life as well as business. As Internet infrastructure becomes stronger, hopefully all channel partners will get connected. I believe this infrastructure will make partners more efficient in terms of communications, logistics, training and connectivity. I don't think anyone could be left out of the Internet phenomenon. 

How should channel partners integrate the Internet into their business?

The Internet will be an efficient vehicle basically for all kinds of interfacing. I don't think that the Internet will play a crucial role in a channel partner selling products, solutions or services. Before this happens, infrastructure has to become stronger and the IT knowledge of the masses has to go up. As long as partners continue to invest in upgrading in terms of knowledge and infrastructure, they would be in the right place to take advantage of the Internet.

How is HP using the Internet to reach out to its channel partners?

HP's channel has a personalized access to Partner Online. This site is a storehouse of extremely well defined information. The partner gets to know everything about our products, their availability and so on. The usage of this site has gone up tremendously in the recent past. We encourage our partners to ask questions on any subject they like and also to give us feedback. 

The other thing we have on the Web is called EOP, which is Electronic Order Processing for our distributors. EOP allows distributors to enter into all HP systems. EOP provides them an easy access to know the stocks available, delivery schedules and so on. 

What should partners look forward from HP in the coming days?

We continue to work towards making HP the most preferred company by channel partners. We want to present HP to the channel as an open and transparent company. We want to ensure that our partners get products of the highest quality, which have very high end-user acceptance. We will continue to invest in our channel's development and training, both in products and solutions. We will also continue to upgrade our infrastructure in terms of logistics to reach them on time, to inform them about product availability and new product launches. We want to make sure that resellers will become even stronger partners of HP in terms of servicing and building up the Internet infrastructure.