Monday, June 11, 2007

We learn from history that we learn nothing from history. George Bernard Shaw....

I was surprised to see that VarBusiness has learned to read NetApp's history of treatment of the channel and are willing to discuss it in an article.


Why NetApp's Growth Slowed
Customers are cutting back; NetApp lacks broad channel strategy

VARBusiness logo By Robert C. DeMarzo, VARBusiness
12:00 AM EDT Mon. Jun. 11, 2007
From the June 11, 2007 issue of VARBusiness

Is the bloom off the Network Appliance rose? That's the question that came to mind as I watched NetApp's stock plummet more than 15 percent, or nearly $6 a share, the day after it disappointed investors with news of a revenue downturn. So the darling of Wall Street, the company whose hand had grown so hot in storage management that its CEO should have changed his name from Warmenhoven to Hotenhoven, is seemingly cooling down.
The man in charge of NetApp's channel, Leonard Iventosch, had a decidedly unconventional view of how to populate a partner base to sustain the company's growth. Whether driven by Iventosch, his superiors or the NetApp culture, which all clearly struggled with the channel, what the company wound up with is a small, loyal cadre of VARs rather than the army it now needs to drive its growth forward. All of its competitors are much further along in their channel development, having realized long ago that they needed to diversify sales efforts, drive down cost of sales and reach new markets.

The man in charge of NetApp's channel, Leonard Iventosch, had a decidedly unconventional view of how to populate a partner base to sustain the company's growth. Whether driven by Iventosch, his superiors or the NetApp culture, which all clearly struggled with the channel, what the company wound up with is a small, loyal cadre of VARs rather than the army it now needs to drive its growth forward. All of its competitors are much further along in their channel development, having realized long ago that they needed to diversify sales efforts, drive down cost of sales and reach new markets.


It seems that some folks are learning from history, NetApp has squandered its relationships with the channel over the last ten years, it is hard to build a loyal channel with their record. And perhaps George Bernard Shaw was wrong - Business people do learn from history when it hits their wallets.

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