Lenovo rolls out its new global partner program

Monday, October 10 2017

In July, Lenovo launched a unified global partner program, Partner Engage, creating a single worldwide framework for both its PC and Data Center partners. This is an important step for Lenovo, which has a strong channel heritage, with more than 90% of sales generated through indirect partners. But its programs have lacked consistency, both geographically and across product, and the inheritance of different systems from the acquisition of IBM’s PC and x86 businesses has created operational complexity. The new program will make it easier for partners to do business with Lenovo across the globe and should reinforce its channel relationships in the face of growing market disruption and greater competitive pressure.

Lenovo has faced a challenging 18 months. Rising costs in its data center and smartphone business, component shortages and competitive pressures have contributed to recent quarterly losses. It is still in the process of returning its data center business to growth. This year, it relinquished its global PC leadership position in combined desktops and notebooks to a re-energized HP. It faces intensified competition from an enlarged Dell EMC, both in PCs and data center, as well as a host of other aggressive competitors, such as Huawei and emerging ODMs serving hyperscale customers.

However, as one of the global leaders across client and data center hardware, Lenovo is benefiting from the continued consolidation of hardware vendors. Channel partners and end-customers are looking for stable, secure suppliers, particularly as customers pursue multi-vendor sourcing to reduce over-dependence on single brands. In 2017, Lenovo has seen a return to PC growth in several regions and its data center business is showing signs of stabilization. The breadth of its portfolio, the strengthening of its brand (in consumer as well as enterprise) and its global scale mean it remains one of the most important vendors for resellers and distributors. Yet it will only be able to capitalize on this opportunity by delivering superior operational effectiveness and a simplified, consistent engagement model with its partners.

A simplified program structure

The Partner Engage program acts as a global umbrella, supported by a single partner portal and common tools and systems. Lenovo has introduced new partner tiers - Platinum, Gold, Silver and Authorized - which are consistent across both PC and DCG, for all regions. However, under this umbrella, PC and data center partners will continue to operate in two separate parallel streams with different requirements and benefits. Partners can choose to participate in either or both streams, but tiering is applied separately for both. So, for example, a reseller may be Platinum level for PC, but Gold or Silver for DCG (or vice versa), based on differing sales volume. The combined volume of PCs and data center will not count towards tier level or incentives and incentive schemes will be structured and operated separately. The combined program has been rolled out on a phased basis across APAC, EMEA, Latin America and North America and is now live in most geographies. Under the umbrella framework, the program allows for some flexibility at a regional level, in terms of incentives levels, reward schemes and tactical initiatives. This allows regional management to respond to local conditions, although Lenovo must ensure this does not lead to further inconsistency, particularly for multi-national partners.


Lenovo has recognized the importance of building its program on the core tenets that underpin the most successful channel programs in the industry: simplicity, consistency, predictability and profitability. Delivering effectively against these promises will be critical, as Lenovo’s rivals pursue similar objectives. Underpinning this is Lenovo’s ambition to create a more automated, self-service approach for partners. This is being implemented in different ways across the globe. The EMEA region, which has led many of the recent initiatives, calls this Channel 2.0. Enhancements have been driven by a greater focus on the pain points of the channel and more emphasis on an outward rather than inward perspective, which Lenovo has tended towards in the past.

Examples include:

Requirements: Tier levels for both PC and DCG will be determined primarily by revenue, with minimal training requirements for each. Revenue thresholds will be simplified where possible. For example, rather than having multiple sub-regional groupings in a specific geography, countries are split into either large (above US$500m total annual PC revenue) and small. In EMEA, Platinum partners in large countries must meet annual revenue thresholds of US$1 million for both PC and DCG, US$200K for Gold and US$80K for Silver. Small country revenue requirements are US$500m, US$100K and US$50K.

Incentives: Lenovo has simplified its rebate model for both PC and DCG partners. Silver, Gold and Platinum partners are paid a base rebate (which increases by tier) from the first dollar of sales to drive greater predictability for partners. Targets and thresholds have been removed for all but its top-tier Platinum partners. 

As well as the base rebate, Platinum PC partners are rewarded on four metrics: revenue growth, sales of Top Seller products (standardized SKUs available through distribution), services attach rate and growth in certain “strategic” products, such as workstations or two-in-ones. Platinum DCG partners are measured on new customer acquisition, solutions and services attach rate and growth. Platinum partners receive MDF and co-marketing funds (with co-marketing also available to Gold data center partners.) Rebates are paid directly to partners by Lenovo, rather than through distribution, simplifying the process for partners and ensuring rewards are not diluted.

Partner Engage dashboard: Lenovo has launched a single partner portal for all partners, supported by single sign-on, to allow partners to track rebates, redeem reward vouchers, manage marketing materials and receive payments for both PC and data center. This is a significant step forward, particularly for partners selling across the whole portfolio.  

Lenovo Bid Portal (LBP): LBP is a pricing tool designed to dramatically speed up response rates on partner bid requests. Lenovo has suffered from slow response times for non-standard run rate products, putting it at a disadvantage to competitors that have already invested in automated tools. LBP, which is managed through the Partner Engage dashboard, is now able to deliver a quote within 90 seconds for products that don’t require a complex quote. LBP is part of a wider Lenovo initiative to dramatically streamline its whole bid process for partners. The aim is to take all quotes from as long as 10 days down to 24 hours at the latest. 

Star Seller (currently Western Europe only): An example of Lenovo’s simplified incentive approach, Star Seller pays an incremental dollar bonus per product – on top of standard rebates – to resellers selling specific “strategic” products, such as all-in-ones and workstations. These are paid in the form of discount vouchers, which can be redeemed via the partner dashboard on future Lenovo product purchases. Partners can use the discount vouchers to boost their margin by a few points or to aggressively compete by applying up to 20% discount on a specific deal. This is a new approach, which has shown early success but may not appeal to all partners.

Expert certification: Lenovo has chosen to make specialization a choice, rather than a requirement, for both PC and DCG partners. This will give partners the opportunity to be recognized for specific capabilities, alongside their Platinum, Gold or Silver tier status. Examples include Workstation Expert for PC partners and Enterprise Expert for DCG partners, with a focus on areas such as software-defined and hyper-converged. This includes hands-on technical and sales training, much of which has been missing since the IBM acquisition. This will also incorporate training around Lenovo’s “meet-in-the-channel” relationships with enterprise vendors, such as Nutanix and Juniper. Expert certification will bring financial benefits on top of the standard incentives.

Recognizing multi-country partners

Lenovo has also introduced a new top program tier, Platinum Plus, for its largest volume and multi-country partners. Platinum Plus has been launched initially in EMEA and only for PCs. If successful, other regions are likely to follow. Platinum Plus partners can take two possible revenue paths: those with significant Lenovo volumes in one country, or combined Lenovo revenue across three or more countries. In EMEA, only nine partners have achieved this status: Atea, Bechtle, Cancom, CDW, Computacenter, Dustin, Econocom, Insight and SCC. The primary benefit is financial. Platinum Plus partners receive healthy accelerators based on achieving growth targets for strategic products, but with additional rebates paid on total quarterly sales volume. But they also gain unique branding and support from Lenovo.

This is important, as Dell EMC, Cisco and other vendors develop similar “exclusive” incentive models for top regional or global partners. Vendors are competing more intensively for the attention of these partners, particularly as enterprise customers look for multi-country partners that can deliver consistently across borders. It would make sense for Lenovo to extend Platinum Plus to the US, where Lenovo sees its top 10 partners represent a vast share of the total business. Many big US resellers are now setting their sights on EMEA, to serve their largest US-headquartered customers with a European presence. Making Platinum Plus a global program - and extending it to include data center - would help Lenovo gain more relevance within these top partners. As it moves to a global program, Lenovo will need to demonstrate clear, consistent communications to its partners, particularly those that have a presence in more than one country or region.

With Partner Engage, Lenovo has a much-improved, global framework to address many of the operational issues, which have hindered its channel performance in the past. But in the face of an increasingly channel-focused competition, it must now prove to partners it can deliver on the promises it has made. This will require a careful balance between unifying some of the legacy go-to-market models that have developed across a number of regions while maintaining its local responsiveness. This is a challenge facing all vendors seeking to globalize channel models.


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