Channel Surfing Blog 

By Khali Henderson

I may be the last to know, but I’ve just been clued in to the channel’s dirty little secret.

It seems there are some agents conspiring with direct salespeople to get compensation for deals they didn’t work.

As I understand it, the scenario goes something like this:

• The direct salesperson closes an account that qualifies for teaming.
• The direct salesperson puts the agent’s name on the order as part of the team sale.
• The direct salesperson and the agent are BOTH paid commission for the sale.
• The agent kicks back half of the commission he or she earned to the direct salesperson, who is a subagent for the agent – albeit through a third party, e.g. a spouse or sibling.

Apparently, this has been discovered by some carriers that offer teaming between direct and indirect sales channels. I am not sure how they have handled it, but dismissal of the employee and cancellation of the agent contract would be a good first step. Legal action for recovery of the “unearned” commissions might be another.

Besides being unethical and illegal, this seems to be a major slap in the face to carriers that have attempted channel integration – something agents say they want. I am not sure how an agent can justify being part of such a scheme.

If you can, fill me in. Post a comment below.

By Cara Sievers

On more than one occasion, I’ve heard channel partners express concern about finding good talent to employ. What I want to know is whether you think there is a shortage of IT sales professionals out there – or if there’s just a shortage of good ones.

Industry organizations definitely recognize a shortage of skilled workers in the tech arena. CompTIA created an educational foundation back in 1998 to churn out entry-level IT employees to help eliminate such shortages. The foundation recently awarded its IT Student Merit Awards to recognize outstanding accomplishments by students and adult learners who have trained for and received CompTIA certification. The winners get cash awards of $250 for use toward their continuing education.

“Forecasts of shortages of qualified IT workers are predicted for the near future,” said John Venator, president and CEO, CompTIA. “Without a ready supply of trained, certified IT professionals to install, operate and maintain technology systems, we’re risking a slowdown in growth and innovation.”

According to a CompTIA survey released earlier this year, security topped the list of the technology skills that are most important to organizations today – but the survey also revealed that the area of security presented the widest skill shortage and the most disparate knowledge gap.

As an answer to the need for qualified labor in the security industry, the National Burglar & Fire Alarm Association (NBFAA) and the Central Station Alarm Association (CSAA) have joined forces to launch the Security Industry Recruiting Center, providing an online source for matching qualified job seekers with security industry employers.

“The security industry is rapidly changing and needs employees who are interested in being a part of this new, high-tech world,” said NBFAA president Mike Miller.

So, as the career recruiting becomes more and more targeted, I ask of you, channel partners – what kinds of people does the channel need? Does the channel need charismatic salespeople or educated technicians? Does the channel need people who can cross-train to sell 10 or 20 technologies fairly well, or does it need people who can sell two or three technologies really, really well? Or maybe the newly-formed Technology Channel Association will be the answer, by honing best practices and raising the standards for agents? Or maybe you think the indirect channel is fine as it is?

You’ve heard of designer babies – so let’s talk about designer agents. What chromosomes do you think are needed in the channel partner DNA of tomorrow? Drop me a line and let me know what you think!

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By Khali Henderson

This week you’ll be hearing about a new organization, the Technology Channel Association. It’s an effort by a few of your peers to bring the agent community together. I have to say, it’s about time.

The agent channel has been around for at least 15 years. The Channel Partners Conference & Expo is 11 years old. What have you been waiting for?

To be fair, there have been efforts along the way to organize agents. Certainly, the Agent Alliance has done a good job of that for its members – the handful of them that form the closed networking and buying group. If you’re not in that club, where does it leave you? There’s TelecomAssociation, which has tried to fill the gap. It’s a for-profit entity, however, which colors its mission regardless of the value of its programs, such as news, education, forums or vendor benchmarking, for agents.

The TCA, on the other hand, aspires to be a legitimate, not-for-profit entity for the promotion of the indirect sales channel. It’s early days for TCA, but it hopes to advocate the indirect sales channel as a viable and sustainable alternative to the direct sales channel.

Among the deliverables will be a knowledgebase of best practices to help agents (and their vendors) succeed. TCA also hopes to gather the evidence – market data and metrics – that quantify the impact of the channel on the overall success of the industry. Finally, it plans to develop a certification program for its members.

These types of programs will require the participation and support of agents and their suppliers. Both in the end will benefit. Vendors will get better indirect sales representation. Agents will get a bigger share of the vendors’ overall sales.

Once there is agreement on standards and metrics and practices, then the opportunity to address the end-user community is an obvious next step. The most qualified indirect sales rep mostly likely will be the most qualified solutions provider.

Standards of practice rarely are a bad thing. They raise the level of professionalism. It’s hard to be against that.

Plus, there are some really great agents behind the effort. Geoff Shepstone, Vince Bradley, Ian Kieninger, Jack Knocke, Dany Bouchedid, Peter Radizeski, Shane McNamara, Jay Bradley ... you get the idea. So sign up for the association. We did. PHONE+ is a founding member and media partner.

By Mike Saxby

While you are away from the office and the day-to-day distractions, it’s a good time to take stock of your business.

What have you got? You’ve built up a book of business. You’ve got a respectable monthly revenue stream. You’ve got customer relationships.

Now what? Unless you want to be in this business forever, you need to be thinking about payday. How can you cash out? How can you exit with the expectation of sitting on an island sipping Mai Tais?

If you are like most agents, your business depends on you being there day in and day out. Your customers want to deal with you. You are the business. There is little in the way of assets that you can sell to exit. You don’t own the customer; your carriers do.

Some of your business may be under evergreen contracts, so the residuals will continue to come in. But does the contract require that you continue to drive new business? So much for that exit strategy. Even if the contract doesn’t require you to be an active agent, it will be hard for you to protect those accounts from the golf course with all the hungry new entrants knocking on their doors. The revenue stream remains at risk.

How can a recurring revenue business survive without you? Here are some ideas:

• Make sure your contracts allow you to assign its rights or obligations to others so that you can “sell” the revenue stream. Attorney Neil Ende, who is speaking Tuesday about analyzing agent agreements, said such clauses can range from prohibiting assignment without consent of the carrier to allowing assignment without limitation.
• Bring in employees or partners that also interface with the customers, so that your interest in the agency can be bought out and you can leave without the revenue leaving with you.
• Assuming your carrier agreements don’t have broad non-compete clauses, create contractual relationships with your customers. These may be for professional services like maintenance, telecom management, TEM or managed services (e.g., proactive network monitoring). Go beyond having a customer list to customer ownership.
• Go to the next step beyond agency and become a network services reseller/rebiller with your own customer LOAs.
• Become part of a franchise organization with branding and infrastructure (service delivery and customer service) that doesn’t depend on you. These are few and far between, but there are some opportunities in the telecom and managed services arenas.
• If none of these things is possible, look into carrier agreements that allow you to retain ownership rights in the customer or to share in the profits that your carriers realize when they sell. There are a number of carriers that have such offers. These are not a sure thing, but if you’re going to sell for someone, you might as well stack the deck in your favor.

Your retirement fund may thank you.

Level 3 CEO Jim Crowe delivers the opening speech at the summit.

In an effort to facilitate development of a wireless industry “ecosystem,” Level 3 brought together these leaders to communicate, collaborate and network --- the theme of the event.

“The companies here today will lead the industry in overcoming common challenges, and together will spur development that will come to define the wireless industry for years to come,” said Crowe.

Level 3 was well-positioned to facilitate a targeted leadership networking event as a neutral, unaffiliated supplier serving the wireless industry. The goal was to draw upon the collective experiences and in-depth knowledge from all attendees in order to discuss industry issues, and how to solve for them, as well as industry opportunities, and how to target them.

Crowe stressed the importance of gathering together and formulating a collaborative approach to the market in order to overcome common challenges and to reap the enormous opportunities in the wireless industry. By fostering and stimulating an interactive discussion, these leaders discussed the importance of wireless and fiber convergence as well as wireless bandwidth growth opportunities. Other Level 3 executives on board, including Peter Neill, senior vice president of the Wholesale Markets Group, and Edgar DeLong, vice president of Level 3’s wireless segment, discussed trends in the industry and strategy to take advantage of the rapid growth and demand within the wireless industry.

Attendees network at Broomfield’s Bloom restaurant.

“Level 3’s strategy is tied directly to these trends we are seeing in the industry, therefore at Level 3, we want to be the low-cost provider of connectivity to all fixed locations [antennas],” said Crowe. “As a neutral provider, Level 3 is well-positioned to be an extension of our customer’s own network, and we look forward to continuing to collaborate with these forward-thinking leaders within the wireless community.”

Following the meeting, the group gathered at Broomfield’s Bloom restaurant for a networking dinner.

By Cara Sievers

Kermit the Frog said it best... it’s not easy being green. In fact, it’s really, really difficult. Although some might think my actions hypocritical surrounding this issue – i.e., I’m an avid recycler but I drive an SUV – I aim to reduce my carbon footprint in little ways every day – knowing that I’m not perfect, trying to remember to turn the water off while I brush my teeth, and pulling on yesterday’s jeans. (Oh, c’mon ... you know you do it too.)

Speaking of recycling... PR reps are doing whatever they can to keep the green pitch from ending up in the dump. This malleable chameleon of a story idea has appeared in my inbox in so many iterations that I could practically start a collection – in fact, I have. I mean, I agree that audio and video conferencing solutions are big green initiatives because burgeoning company travel is expensive and harmful to the environment. I’ve written about it myself. But honestly, I can’t decide if I’m increasingly intrigued by the idea of positioning telecom sales along with companies’ fights to be more eco-friendly or if it superfluously sickens me.

The Telecommunications Industry Association (TIA) recently announced at NXTcomm it is investing in a number of green initiatives for the electronics industry worldwide. They include EIATRACK, TIA’s global benchmark for environmental intelligence and product-oriented regulatory tracking and analysis, and TIA’s E-cycling Central Web site, with a new state-by-state database of more than 2,000 electronics recycling locations in the United States. TIA also is rallying communications companies around issues relating to the greening of technology and additionally is exploring standardization of data centers to reduce their carbon footprints.

And I guess the world of telecom could never technically be off the grid, but its marketing can be. For example, marketer Above All Advertising Inc., with clients like AT&T and Verizon Wireless, recently touted its ecologically friendly bamboo retail signage stands to replace their evil aluminum counterparts. And Aberdeen Group recently benchmarked how companies could spare environmental waste with “green marketing” practices surrounding customer data management.

But what do you think? Agents, is it all a bunch of hype? Are you really concerned about the environment or do you just think it’s a good sales pitch? Better yet, is it really a good sales pitch at all? How have your customers responded? Are the CFOs at your potential customers really the kind of people that line up at rallies to save the Earth? So tell me... are your customers green with envy of all the environmentally-friendly advances of their competitors – or is it all just a big heap of compost?

Let me know what you think about this green movement and whether it’s helping or hindering your business. Leave me a comment below. Thanks!

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By Khali Henderson

Hurricane Dolly, a tropical cyclone that hit Southern Texas last week is a tragic reminder of the need to consider disaster recovery and business continuity planning.

The tropical storm made its way from the Yucatan Peninsula to the Gulf of Mexico, leaving nearly 20 dead in its wake. It hit South Padre Island, Texas, July 23. The storm caused no deaths in Texas, but caused an estimated $1.2 billion dollars in damage and left thousands without power.

Unfortunately, this storm was not an isolated incident. Dolly was the fourth tropical cyclone and second hurricane to form during the 2008 Atlantic hurricane season.

To add even greater perspective, in 2007, there were 399 natural disasters impacting nearly 200 million people across the globe and with an economic impact of more than $60 billion dollars, according to the 2008 Edwards Disaster Recovery Directory.

Overall, business continuity planning was seen as a priority by seven of 10 IT executives, according to the 2008 AT&T Business Continuity Study. Four of 10 indicated it had always been a priority for their business, and more than a quarter indicated it has become a priority in recent years because of heightened awareness of natural disasters, security and terrorist threats.

Nonetheless, 28 percent said business continuity planning was “not a priority”. While 80 percent indicated their companies had a business continuity plan, one-fifth (18 percent) said they did not.

The majority (79 percent) of companies have instituted special arrangements for communicating with key executives during a natural disaster. A similar proportion have e-mail or text messaging capabilities to reach employees outside of work, and two-thirds have systems in place that enable most employees to work from home or remote locations. Only four out of 10 companies have automated calling systems to reach employees by telephone or cell phone outside of work.

A 2007 report from In-Stat showed businesses also are increasingly interested in managed solutions for business continuity and disaster recovery. If offered, BCDR is the leading value-added application businesses would seek from a carrier in conjunction with IP VPN services. In addition, sixteen percent of the businesses currently using in-house solutions are planning to outsource their back-up and storage needs in the next 12 months, the report said. This figure is 33 percent among mid-sized businesses.

Helping companies to ensure their communications are up and running is not only an opportunity but an obligation for telecom agents and telecom service providers that are truly consultative.

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