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Mitel - 'We needed to swing the axe. You can't share your love too wide'

Mitel - 'We needed to swing the axe. You can't share your love too wide'

08 Aug 12:00 by Lucy Cinder

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Mitel's global SVP Jeremy Butt has justified slashing the UC giant's distribution network from "over 60 to a maximum of 20", by calling some of its previous distribution partnerships "no longer fit for purpose".

Speaking to CRN sister publication Channelnomics Europe, Butt (pictured) explained that in the 10 months since he took the lead as Mitel's global channel boss, his team has whittled out those distributors that were no longer "mutually relevant."

"Our network needed a massive axe and a massive increase in the amount of business we put through distribution to make sure we get that mutual benefit," he said.

"We had some people we worked with, and when you step back and look, 10 years ago they might have been OK. But in the fast-moving, more connected, more transactional world, it just doesn't cut it any more.

"First and foremost that's what's driven our strategy, because you can't share your love too wide."

Butt confirmed that cuts are ongoing, pointing to two or three longer distribution contracts that the firm is likely to allow to expire by the end of this year.

However, one business that has made the grade is Westcon-Comstor, of which Butt used to be executive VP EMEA before he joined Mitel last October.

The New York-based firm was announced as Mitel's sole pan-international distributor last month.

"We've never had a sole international distributor before," Butt said.

"It might look like we're biased towards them because I came from there, but that's not the case at all. If anything, it's meant that I've put the deal under even greater scrutiny because I understood an awful lot about Westcon-Comstor because I ran it for five and a half years.

"They have a larger footprint than us and we're looking to leverage the close local relationships that they have, and their capabilities. They have 50 dedicated training rooms, professional services in multiple countries, multi-lingual support desks, reverse logistics, and very good renewal licence capabilities.

"This is all the stuff that we want that not everyone leverages."

Butt did concede that his strategy may raise some eyebrows among his competitors.

"I am very comfortable that in some countries, we only have one distributor," he said.

"I know that some vendors think ‘I will never have only one distributor, because that keeps the first distributor honest'. However, I've never bought into that. I think ultimately it's the personal relationships in these deals that make the partnership work."

One market where Mitel has chosen to partner with more than one distributor is the UK. In June, Exertis was added in addition to Westcon-Comstor and Trust Distribution. With Mitel's distribution overhaul being so drastic, Butt also acknowledged that some partners and customers may have been caught off guard.

"Yes, we were one of the last to embrace distribution," Butt said.

"But we are fully embracing it now. And with a smaller number of distributors, customers will have a better experience, because vendors don't typically do a great job of having direct relationships with a large number of partners anyway.

"For us, Mitel can focus on driving preference and loyalty to our products themselves."

Source: channelweb