Changes in the air for LAN Systems

Part of the Westcon Group, LAN Systems has started to undergo a rebranding campaign and will be known as Westcon from March next year. The move will enable LAN Systems to leverage the reputation and support of its international counterparts, placing the distributor in a position to use the global marketing creatives and work with resellers that have an international reach. CRN editor Helen Frost spoke to Tom Dolan, president and CEO of Westcon Group to see what the benefits would be for local partners.

CRN: Do think the partners who have known the name LAN Systems for a long period will transition well to this change?

Dolan: It is a change which is paced by local management here. We set it as an objective a few years ago about how to figure out how to get it done and when the right time would be.

We think that the name LAN is a great name. It has got 18-year history. It is also rather a dated name. We are not LAN anymore, we are a lot of different things.

We are talking to customers about it and I think there is an interest in what we can bring from a multinational perspective. They are giving us the opportunity to earn the new respect from the new name.

CRN: With the renaming and the brand changing, are you looking to bring over any technologies to complement what you already have at LAN Systems?

Dolan: We would hope that what we bring is a couple of dimensions to our ability to serve customers in Australia. Throughout our company we get capabilities which are developed in our local countries which we can bring to the other countries we are in. Our company has gone through an evolution where the local countries would operate on their own.

The model was similar and the market was similar but there is nothing more than an informal link from one country to the next. What we have learnt in the past two years is that there is a lot of intellectual property that we can circulate among our countries that is to the benefit of everyone.

We have started doing a number of all category manager meetings. One week all operations managers happened to be in Virginia. Another week all security product sales management met in Lisbon. This month all marketing managers meet in the US. By bringing those communities together in the company we are circulating a tremendous amount of knowledge about how to bring value down to the customer base. That’s truly for us the most important part of our globalisation effort – to become a better distribution partner for our vendors and for customers.

By learning the art of distribution and training ourselves in it, there are very direct benefits which go to customers. One of them which will become apparent shortly is the ability to serve our multinational customers. Because of outsourcing and globalisation, a VAR in Australia sells to a company in Sydney, but that company in Sydney has business partners and offices in Singapore or London and the US, so how can that VAR manage that customer’s requirement? We think we will be able to offer an excellent way for our customers to do that. We have started with a number of European customers and we are going to roll out that capability across the company. So then it becomes important that we’re all named Westcon. We already have one common integrated computer system around the world or processing system which obviously gives us capability, control and visibility. We are just getting a lot more requests from our dealer customers large and small for multinational co-ordination.

We think it is a natural evolution of the overall global economy and it gives us a unique opportunity, because we are a global company, but we are a smaller global company.

We are certainly smaller than some of the other global distributors and we think internally we will be more connected.

CRN: Are you looking to find any other vendors with the Westcon rebranding?

Dolan: What we try to do in our product line philosophy is that we have different categories. Foundation vendors are multinational vendors and we have some security vendors and networking vendors in that category. We hope to add more and the rebranding of Westcon contributes to that.
Next are the infinity vendors, which are smaller and add significant value to foundation vendors. We do believe we will be able to bring in a number of exclusive infinity relationships as a consequence of this branding.

CRN: Our readers are not convinced that even if Dell finds the right distribution strategy that they will go with them. Is that something you agree with?

Dolan: I have been at distributor meetings with all the CEOs from all the big distributors and they are all going “Okay, who is talking to Dell? No-one is talking to Dell are we?”. I’m sure someone is talking to Dell as it’s a business opportunity, but there is a great sentiment to make it difficult for them.

CRN: Will your training program change for any of your channel partners within Australia with the rebrand?

Dolan: I’m not sure there will be a massive change. We already do a fair amount of sharing of content.

CRN: What do you see as they main key benefit of the rebranding?

Dolan: We are a multinational company and what we should be
able to do is bring additional benefits to every region because we are multinational.

We think we are going to bring it in a few constructive ways: leverage with the vendors, exclusive infinity arrangements and the ability to serve multinational customers.

CRN: Who would you see as your major competitors within your specific space within Australia?

Dolan: Our major competition is broadline fulfilment distribution around the world, and then in particular regions it is very often another value-added distributor. The largest competition is the concept of what a value-added distributor brings to the vendor and to the customer.

In each region we will have named companies which we compete with, but structurally it is always a question of value versus fulfilment.

CRN: How do you classify an SMB?

Dolan: That’s interesting and people look at me and ask how we do in the US, but 60 percent of my revenue is from outside the US. I do have a US territory and that’s 40 percent of our revenue. The SMB is always relative to the size of the regional pyramid. Every pyramid has got a top and every pyramid has got a bottom, and the SMB is a section of it.

SMB in the US would be 500 to 1000 employees, maybe here it is going to be 100 to 250 employees, but it’s a marketing approach, it’s about how you can efficiently recruit and enable dealers to be successful for that market. In fact it can be more challenging in what we call international markets because the sales would be smaller and so it can be more challenging for a distributor, but it is just something we have to rise up to.

CRN: If 60 percent of your revenue comes from outside of the US, where does Australia fit into that figure?

Dolan: Six percent.

CRN: In comparison is that good?

Dolan: It is certainly good relative to the size of, for example, the Australian economy compared with the size of the British economy. We have a very good performing subsidiary here in Australia.

CRN: Have you got any idea what types of technologies are being planned that the SMB will pick up on?

Dolan: I think the operative words are: it must be sold, it won’t be bought. That’s the whole value of channel – to figure how to sell and then to enable and to train.

CRN: Do you find Australia is a quick country to pick up on new trends?

Dolan: I would say it is one of the first. Singapore is very quick, Australia is very quick, and the UK is very quick. There are other countries where it is slower and you see more of a lag.

CRN: What do you see as the biggest hurdles for resellers at the moment?

Dolan: Around the world our dealer customers tell us that recruiting salespeople is their number one issue.

We can’t create salespeople for them, but what we can do is make their most successful salespeople more productive through the support that we give them. We can also enable and train new salespeople to make them more efficient. We believe in our model. That’s the value in our value-add.

CRN: What are the main trends that will be picked up that resellers can position themselves to make revenue from next year?

Dolan: We think that video conferencing is an interesting one. It is also about taking the top salespeople and making them more productive. The employer needs to provide a better quality of life to retain those people. Technology through Unified Communications and video conferencing can play a significant role in that.