Coronavirus Relief: HPE, Aruba Suspend Partner Ready Revenue Targets

‘We’re looking to support and help our partners and make sure we are really cultivating a vibrant partner ecosystem,’ says HPE Worldwide Channel Chief Paul Hunter. ‘If we want partners to succeed in the long term we have to invest in the short term.’

Hewlett Packard Enterprise has suspended revenue thresholds for both its HPE and Aruba Partner Ready channel programs as a part of a broad coronavirus relief package.

The revenue threshold relief ensures partners will stay at the same level in the two Partner Ready programs for 2021 even if they do not meet revenue commitment levels in wake of the coronavirus pandemic..

HPE has also provided dramatic financial relief to distributors aimed at helping small and medium business focused partners. Those initiatives include suspending or significantly reducing strategic development initiative targets and providing extended payment and early payment discount terms. Those cash relief offers run from May 1 to July 31.

HPE Worldwide Channel Chief Paul Hunter told CRN that the changes are aimed at helping partners get through the pandemic in good financial shape. “We’re looking to support and help our partners and make sure we are really cultivating a vibrant partner ecosystem,” he said. “If we want partners to succeed in the long term we have to invest in the short term.”

The “significant” investments HPE has made in the coronavirus relief effort for partners required “incremental investment” from HPE, said Hunter. “This is one of the times when it makes a big difference to be working with a company that is built on a solid financial foundation,” he said. “We have had support from (HPE CEO) Antonio (Neri), our CFO Tarek Robbiati and our (Hybrid IT) President Phil Davis to make additional investments in Q3 to help improve the liquidity of our distributors. That allows them to help our small partners who I think are the most vulnerable. Just as with the US economy small businesses are more vulnerable than the really big, well financed businesses….The small partner base is very important to us.”

Paul O’Dell, a director at CPP Associates, a Clinton, N.J. HPE Platinum partner, said the relief is welcome news for a partner community that is grappling with the economic impact from the pandemic.

“HPE is taking into consideration that there is going to be a lot of bumps and bruises,” said O’Dell. “The economy is very unsteady. When have you ever seen oil futures being a negative $37 dollars a barrel? I appreciate HPE and Aruba showing a steady hand and continuing to provide support for its partners.”

CPP Associates, for its part, has already achieved its Platinum level for the next fiscal year and holds a Silver level designation for Aruba, said O’Dell.

The distributor assistance is going to have a trickle down effect on partners, said O’Dell. “That is going to have a snowball effect,” he said. “If HPE provides some leniency on distributors then that is going to be passed on to us and then to our clients. Anything that allows us to provide customers with extended terms is a big deal.”

Customers impacted by the crises are asking for extended payment terms, said O’Dell. “Anything that helps us extend those terms systematically would be tremendously beneficial to us,” he said. “A lot of people are suffering right now. A lot of companies are having a hard time so anything that allows customers to hold on to their money a little bit longer is beneficial.”

CPP Is making investments in clients while some competitors are pulling back, said O’Dell. For example, CPP has done 16 free security assessments for customers that usually cost $10,000.”We are trying to create good will with our clients right now,” he said. “We are just trying to be helpful.”

CPP is seeing traction in the midst of the pandemic with its backup/disaster recovery as a service business, Artificial Intelligence based data intelligence practice and its security practice, said O’Dell

O’Dell, who previously worked at HPE, said HPE continues to be a company that does right by its customers, partners and employees. “I had an HPE manager who used to say you never want to do something that your Mother would not be proud of,” said O’Dell. “HPE has always lived by that standard. Some other companies out there don’t operate that way. But HPE always steps up and does the right thing.”

Paul Cohen, vice president of sales for New York-based PKA Technologies Inc., one of HPE's original Platinum partners, said the financial relief is “great news” for the partner community. “We continue to drive toward exceeding our HPE and Aruba revenue thresholds,” he said. “We are working around the clock to help our customers. We are doing digital marketing hand in hand with HPE Marketing team to drive sales pipeline.”

Cohen commended Hunter and the rest of the HPE channel team including North America Channel Chief Leslie Maher and HPE Vice President Channel Sales Rob Schaffer for “understanding the current situation” and responding in full force with assistance for partners. “By HPE extending this program during this difficult time- it creates a stronger affinity and instills loyalty in an already loyal partner base,” he said.

PKA has seen strong traction from the HPE Financial Services $2 billion investment in a payment relief program that allows customers to defer over 90 percent of the total contract value of products and services until 2021.“The HPE FS offers of delayed payments are resonating with customers,” said Cohen. “We are resurrecting deals and getting them done as a result of those HPE FS offers.”

One deal that PKA is working on for HPE Nimble storage with InfoSight predictive analytics software is coming in at five times the original budget because of the HPE FS offer, said Cohen. “The CFO we are working with wants to completely update the IT infrastructure and the financing is making it happen,” he said.

Mike Vencel, president of Comport Consulting an HPE Platinum partner headquartered in Ramsey, N.J., said he sees the HPE FS assistance combined with GreenLake pay per use as a one two punch that is going to be key to helping keep key customer IT priorities on track.

“The big question is what does it look like for our customers in terms of IT priorities for the second half of the year and how do they want to deploy what is going to be a precious amount of cash?” said Vencel. “That is where HPE is really stepping up by offering these consumption models, whether it is HPE FS or GreenLake. Customers are going to be maniacal going forward about how they manage their cash.”

The flexibility HPE is providing is going to be vital to greenlighting IT projects, said Vencel. “As businesses start to evaluate the amount of damage they have sustained they are going to be looking across their enterprise at how they can cut costs,” he said. “They are going to be looking at both capex and opex they can drive out. They are going to look at IT differently and these HPE programs are absolutely going to help.”

The coronavirus pandemic is accelerating IT initiatives focused on mobility, security, cloud services and pay per use consumption, said Vencel. “This Covid-19 experience has put all of those technologies into hyper-speed,” he said. “That is going to be one of the lasting effects of this pandemic. Customer behavior is going to change. We are going to walk out of this thinking differently about how we successfully deploy work forces that work out of their homes and how do we secure them. The world is transforming fast. What HPE is doing with flexibility around consumption and financing is an absolute necessity. Not only do these programs allow customers to move forward with projects it also provides a shared financial risk model with the channel that is much needed right now.”

In a blog post, Hunter said HPE is taking action to “relieve financial pressure for all our partners” and at the same time “mobilizing the full weight of its resources” to help customers. He told CRN that the “rallying cry” as HPE tackles the partner financial challenges surrounding the coronavirus pandemic is to be “flexible” and adjust to the new normal. “We will come out of this as better, healthier, stronger companies,” said Hunter. “The fittest will continue to prosper. This will make us a better company and it will make our partners better.”