‘We want to centralize all servicing activities to monitor the quality of service better’

MD of Asia Pacific operations, Charles Chen is responsible for sales and
profitability for Accton Technology Corporation Pte Ltd. He also provides
strategic directions for Asia Pacific operations and is instrumental in
developing new territories. Since joining Accton in July 1991, Charles has held
several senior management positions such as domestic channel manager-Taipei as
well as director of the company’s Asia headquarters. He holds a Master of
Business Administration degree from Northrop University, USA. Charles, who was
in Mumbai recently, spoke to DQCI. Excerpts from the conversation: 

Which are the
products that Accton is keen on introducing in the Indian market?

We are launching about
ten different products in the Indian market including wireless LAN, ADSL modems,
as well as USB modems.

Wireless LANs have
been slow in gaining popularity…

We expect wireless LANs
to catch up very soon. In fact, we have already received inquiries for wireless
modems from a few corporates. Of course, there are a few issues like wireless
spectrum usage to be resolved first. We also intend to begin road shows for all
these products from the middle of May in the main metros. 

What kind of demand
do you expect for ADSL modems?

About ADSL modems, we
expect demand to go up steadily. We expect to sell a few thousands in India

How much of sales in
India go through channels at present?

Right now almost 70 to
80 percent of our total sales are routed through our channel partners.

Have you put any
warranty policy in place?

Well, the Accton Express
Warranty Scheme will be in effect from April 2. We are offering repair,
replacement and servicing free for one year. We are trying to provide repair and
replace products within four days and it is here that the channel comes in. This
is because it is not merely selling, there are various servicing aspects
involved too.

What is your channel
strength in the Indian market at present?

We have about 35 systems
integrators and 80 active resellers. We are also coming out with a major channel
program soon. We launched major channel initiatives for NICs and switches from
the first week of March and are seeking resellers and systems integrators in
these product segments. Most of these switches are systems integrator oriented
products, while NICs will be aimed at the reseller market. This will help us
offer end-to-end solutions. We hope to attract a lot of systems integrators with
these product offerings.

Is Accton planning to
run any special schemes for channel partners?

We are coming out with a
scratch card scheme. With the purchase of every NIC, a channel partner will get
a scratch card. The biggest attraction will be a trip to Singapore. There will
also be on-the-spot cash payments. This scheme will last exactly for one

How many channel
partners do you hope to attract? 

We are looking at fifty
more channel partners, from authorized stockists to resellers. We are setting up
a separate warranty support organization to whom we will outsource all the
service and support functions. In four locations, our channel partners will do
actual replacement of components. In other locations, products will actually be
replaced. We are looking at places like Cochin and Nagpur as well.

Don’t you think there will be any duplication of channels?

No, I don’t think
there will be any duplication of functions between the partners to whom we
outsource and our channel partners comprising resellers and systems integrators.
Our systems integrators and resellers have their own business pressures and may
not be able to do justice to the servicing aspects.

Some systems integrators
are definitely in a position to do servicing as well, but they may not have the
locations. Also, their skill levels vary from place to place. We would like to
ensure that all servicing activities are centralized, as this will help us
monitor the quality of service better. Moreover, even if our channel partners
change the focus of their individual businesses, service will not be affected in
any way. 

Don’t you think
systems integrators could earn better margins from servicing?

Well, we believe that
their margins will not be affected in any way, as they will be able to
concentrate on maximizing their revenues from other areas.

Are you offering any
specific training to engineers?

We plan to train
engineers of our support centers extensively. The formal agreement with our
service partner has also been signed. In fact, we have already trained 12
engineers all over the country. For systems integrators, we are going to have
training programs by the end of this quarter.

Are you planning to
upgrade your Indian operations in any way?

Sure. Accton India is
now a 100 per cent subsidiary. We are upgrading our Indian liaison office to an
independent profit center. While the Indian office will continue to report to
Accton Asia Pacific, it will have a direct say in the operations in India. The
India profit center will contribute $25 million or nearly a quarter of Accton
Asia Pacific’s targeted $100 million in revenues by 2003. Our Indian
subsidiary will now import semi knock-down kits (SKDs) and complete knock-down
kits (CKDs) and assemble them within the country.

Do you feel that the
ongoing slowdown could affect your plans?

We believe that the
Indian market is expected to explode in the years to come and we would like to
be part of that growth. India is unlike other markets like Korea for example.
Also, the Indian economy is still growing. So I don’t think it will affect our

What is your
impression about Indian channel partners?

I think Indian channel
partners are very fast learners.

Bobby Anthony in Mumbai

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