While Lenovo continues to disrupt the data center market with its customer-centric solutions, it is undertaking a differentiated approach to empower partners, which will help them tap new markets and unlock the underlying opportunities
By Nivedan Prakash & Sandhya Michu
In order to compete with heavyweights like Hewlett Packard Enterprise (HPE) and Dell Technologies in the data center business, Lenovo has formed a new business unit, Lenovo Data Center Group (DCG). This division within Lenovo is a year old. The initial focus has been on defining the strategy and the funding for the development of new hardware and software products.
In India, the group is headed by Vivek Sharma who took over the role of Managing Director in April 2017. The company’s channel business is being led by Ashish Taneja. With the formation of this new entity, the company has been putting its strong go-to-market strategy, both for end customers and partners. Eyeing a strong growth in the data center business in the Indian market, Lenovo DCG has taken a partner-focused approach and is going to announce a slew of channel enablement programs in 2019.
As part of its offerings, the company focuses on areas like HCI, hybrid cloud, and software-defined storage. It is even moving into edge computing. The company is positioning itself as a more consistent provider of services, rebates, programs, etc for its channel partners. Lenovo has opportunity to grow its data center hardware installed base. Lenovo has alliances and supply chain processes in place as well as a technology vision that will help it capitalize on this opportunity.
Speaking exclusively to the CRN India, Ashish Taneja, Channel Head, Data Center Group, Lenovo India, says, “Lenovo DCG is working like a start-up. Before taking a channel route, we first established our customers’ stories. The idea was to present a complete spectrum with customer preferences before the partners. We are the dark horse and a small player, so we are very agile and nimble. The partners we pick and choose have shown strong business appetite and want to scale up. We will remain partner focused as our blueprint and strategy doesn’t hinder our partners which provides us with a different edge than the others. Currently, we are working with more than 350 value and volume partners.”
Taking differentiated approach
For driving the partners business, Lenovo DCG is building a partner program covering the important aspects including market, technologies, profitability and simplicity. “In my opinion, there’s no perfect partner program across markets for one company and there’s a certain bit of adaptation always required. The partner program simply runs around ease of business and its profitability, there’s no third thing. You can’t have too many tenants in a program. The program is relevant to a partner if he can quickly align and is comfortable – these are the only two requisites, nothing else,” he affirms.
With the new team and defined strategies for partners, the company is doubling its partner base every quarter.
From a channel perspective, it is investing in initiatives such as launching more formal certifications, including through the Lenovo Data Center Sales Professional and Lenovo Data Center Technical Sales Professional programs. It is also facilitating more consultative engagements with customers by offering partners deeper training around industry-specific IT trends and customer requirements.
Enhancing and restructuring its go-to-market initiatives more closely align Lenovo’s selling model with customer demand for longer-term, transformation-centric and project-based relationships with their data center infrastructure providers.
Taneja asserts, “Our go to market is very relevant to our size and scale of business. We are a 100 percent partner driven organization. In India, we have a compelling partner story in place. While all the businesses are essentially led by partners, there are certain HPC businesses where we have to work directly with the organization because of the nature and demand of the business. Barring this, all other focus verticals including government, upper mid markets mid market, and SMB – are all addressed by our partners.”
“Our channel business is doubling every quarter and the way business is growing, it looks like that in the coming quarter, we will doubling it as well. We are growing small and in limited ventures, as we are taking right and firm steps. We are hand picking, choosing and growing with our partners,” he emphasizes.
The company is very conscious about two things in its infancy stage of growth. Firstly, it wants to keep the channel conflict to the minimum. This means doing more with less. All accounts have been mapped to channel partners. “So, when channel partners engage with any customer, we know exactly which account which partners are looking into. And this is proactively done by our partners. Partners feel very confident in this structured approach and they come in with requests of the account they want to work on. Generally most of them go to the vendor companies and ask what can you do for us; but in our case, we approach partners with the accounts, ask them to pick and choose, and give them the first right to refusal. This is the kind of change of taste that we have brought for partners from what they have been used to, and this opens a lot of doors for us. And then we back it up with the entire program of deal generation, demand generations, partner led events and whole gamut around it,” explains Taneja.
Channel integration post-Netapp alliance
Lenovo has signed a storage alliance with NetApp, in a bid to challenge the market dominance of Dell EMC and Hewlett Packard Enterprise.
Lenovo DCG has made its offerings stronger with its partnership with NetApp. As the company had a relatively small portfolio in storage, this partnership with NetApp and its extensive portfolio provides much bigger access to 90 per cent of this market.
This partnership with NetApp demonstrates the company’s commitment to deliver the best storage and data management offerings to its customers. “Our story of server-storage as a spectrum completes 70 per cent of it. We are not competing with them. We have our own box and we sell it to our partner sets. NetApp also has their own boxes which they sell to their partner sets without any overlapping,” he informs.
HCI and AI – big focus areas
Lenovo’s DCG, and with new alliances – such as that with NetApp – and new products, the vendor has its sights set on a successful 2019. Doubling the hyperconverged infrastructure (HCI) business; that takes the form of Nutanix today. It’s an area where there’s a lot of headroom to grow in the market.
HCI and Artificial Intelligence are the two big focus areas for Lenovo DCG and the company is ensuring readiness and strong pre-sales as well as process support for its partners. “HCI makes sense for the partners as we see increased growth opportunities. We have the most diverse portfolio of ways to deliver that technology to our mutual customers. With our agreement with NetApp and our new storage line, we can penetrate the broad storage market, over 80 percent, and we see it as the next area of growth for us and our partners,” adds Taneja.
Apart from HCI, Artificial intelligence is gaining momentum across partners. However, Lenovo feels it is at the evaluation stage because very few customers as well as partners have embarked on the journey. “We’ve invested some couple of billion dollars into AI and having dedicated teams in the world talking about how to monetise this for customers. We have set up labs wherein we invite customers and partners to experience the AI journey. The entire program has been encapsulated into 10 steps and we are exploring new areas of AI applications,” he concludes.