'We are now talking about the concept of e-licensing'

Kishore Badami informs that Citrix maintains high level of communications

with its partners worldwide and especially in a vast country like India. He is

currently driving the formulation of a reseller recommended pricing strategy for

partners, which will ensure that their margins are safeguarded. Apart from being

responsible for developing Citrix’s marketing strategies for India, Kishore

also works towards forging alliances with independent software and hardware

vendors. Excerpts from the interview:

What is Citrix’s channel structure inIndia?



We have large players like HCL, Accel ICIM and Wipro, who are our gold level

certified software manager (CSM) partners. Then we have some regional gold

partners like Allied Digital Services.

The more you interact with your partners, the closer you are to them and issues get resolved quickly

Kishore Badami, Marketing Director, Citrix Software

Then we have the silver partners. These are anyone who get accredited as a

CSM. There are two ways of getting accredited. One way is that he pays us a fee,

which is waived off if he achieves his total sales target. The other way is when

he gets the minimum certification and skills. Here again Citrix has been more

than generous in providing training and equipping them.

Software resellers complain that vendors are not very prompt when it comes

to communication. What are the levels of communication that Citrix has with its

channel partners?



Citrix, as a company, has always been very open with its partners. Our

interaction is on a day-to-day basis. At the business manager level, our person

is in constant touch with partners, so they can approach him with any problems

that they might be facing. Even if we cannot resolve all their problems, we make

it a point to at least acknowledge their grievances.

On a quarterly basis, we meet partners at channel meets that we organize.

Here again partners have the complete freedom to air their opinions, complaints

and suggestions. We also have an e-mail communication program where we keep

channels informed of every change that might impact their business. This could

include price or warranty policy change or product upgradation.

How good is your online channel interaction?



Whatever information we send to our partners gets automatically posted on

our channel web site. So an authorized partner can log onto this site and access

all the information that we have shared in the past few months. Besides all

this, from the marketing perspective, there is a nominated channel marketing

person. Every partner has his e-mail ID and he is easily accessible all the

time.

The reason we have set up multiple levels of communications is because we

believe that the more you interact with the partners, the closer you are to them

and the more information you get. And if there are any issues, then it gets

resolved very quickly.

But do you ensure that these partners get timely information?



There is no way these people do not get information in advance. This is

because the information flows through automated systems and process. Anyone who

meets our criteria, gets listed on our web site. If his name is there, then he

is entitled to receive all our communication. However, if his name is not there,

it implies he is not an official channel partner and may be selling one or two

boxes now and then. So obviously he will not be able to get any information

directly from our end.

Whenever you announce a new version of product, how do you ensure that the

channel is not stuck with inventory of the earlier versions?



In hardware, there is an end of life of the product. So you can have a

situation where a reseller stocks up a number of PCs. And then when a new model

comes, the old one becomes obsolete. Even then the vendor will give him 30-day

credit and some margin to cover his transition period. Beyond that he has to put

in extra effort to make sure that he sells off the older model.

However, this is not the case with software. All our CSMs know that twice a

year, we come out with our product updates. They all know which are the months

these updates would be rolled out in. So there is no issue of stocking on the

products. Most of our sales are back-to-back. In our case we give 25 days credit

for stock-on-hand. A year ago, it was close to 15 days.

It is not that our channel is expected to keep stock, because each customer’s

requirements are different. We are now talking about moving more and more

towards the concept of e-licensing. Worldwide, there has been a 35 percent shift

to e-licenses, which is good news for the channel.

How will this be useful for the channel?



It is just the licensing model that gets changed. Life becomes easier for

partners as with e-licensing administrative hassles are reduced. However, the

costing remains the same. Also the sales cycle gets drastically reduced.

Physically when you are selling licenses, it takes nearly fifteen days to get

the products from the distributor and then sell it. With e-licensing, this gets

reduced to half the time as the partners can place their orders directly on the

Net.

Does this mean that all your channel sales will gradually shift to

e-licensing?



No, there will always be a mode for physical delivery of licenses which

would co-exist with the e-licensing mode. There will be partners who might go in

for both the modes. We are just extending an option to them, they can choose to

do business whichever way they feel comfortable.

Citrix partners say that there is a lot of undercutting happening in the

service quotations offered to customers. Would it not be feasible for Citrix to

have a minimum service fee, to which all partners can adhere to?



This is a very good suggestion. And yes, this has been an issue with

partners. However, when you look at your partners, they do hardware, software,

networking and they may also be selling Citrix side by side. Whenever, the

partner takes a project for integration for, let’s say 20 users, he is

providing services in all the above mentioned areas.

Citrix cannot define and tell him that this is what you must charge for

services. This is because the cost concerns end-user, not us. But yes, we can

recommend that he should stick to a certain band of pricing. We are formulating

a recommended pricing strategy for our partners which will be announced shortly.

VINITA BHATIA in Mumbai