'We would rather be under-distributed, as over-distribution has a direct impact on partner profitability'

Mark Fioretto is a man with a mission –to help Nortel regain its lost
glory. With an aim to increase customer awareness of the brand, he shares his
three-pronged strategy with DQCI. This includes re-establishing Nortel’s
presence in the tier-two marketplace, improving partner and user communication
and offering prompt after-sales service.

What is Nortel’s channel structure in India?

We have two types of channel partners in this country. The nPower channel,
that comprise systems integrators (SIs), who are focused on large and medium
enterprises. Resellers who target small and medium enterprises (SMEs) make up
the second tier.

Our nPower channel partners are Global Telesystems, HCL,
Wipro, HP, Ramco, IBM and Ingram Micro. Ingram Micro’s 1,000 resellers give us
reach in smaller cities. We plan to focus strongly on this channel and launch
loyalty programs as well as reward those partners selling our products.

How are you going to boost partner loyalty?

Nortel Networks has already started accrediting its tier-two partners as
nPower Bronze Partners to address the SMB market. The company plans to accredit
40 partners by the end of this calendar year and another 100 by December, 2004.

We have also added another layer to our partner program, by
labeling SIs as Platinum, Gold and Silver Partners, based on the volume of
business done by them.

Do you think your single disty, Ingram, can do justice to
your products in a country as vast as India?

As of now, we believe that a single distributor provides us the reach needed
by us. We have to keep in mind the interest of the channel also.

We would rather be under-distributed, as over- distribution
has a direct impact on partner profitability. Our partner engagement has to be a
win-win situation for us as well as the distributor.

Nortel is reportedly not finding favor in India due to its
high pricing. This has also been cited as the reason for it losing out to
competition. How do you intend to address the pricing issue?

We believe that this is only a perception, which is far from the reality. We
have revamped our product portfolio and launched many new devices in the
enterprise space recently.

Our portfolio is one of the most aggressively-priced in the
marketplace. However, we do understand that we have work on our communication
with customers and tell them that our products are not only technologically
better, but are also very competitive on pricing.

In the past three years, Nortel has slipped from its
position as one of the top three networking companies in India? How does it plan
to regain its position among the leading players?

We have formulated an aggressive strategy to establish our leadership
position in the market. To start with, we will re-establish our presence in the
tier-two marketplace. We will follow this up by improving communication with
partners and customers.

Our challenge today is not that we are fighting for strategic
deals and are losing it. On the contrary, wherever we fight, we win most of
these business contracts. Our challenge today is not that we are fighting deals
and losing; it is to get partners to participate in these very deals. Once we
are in the ring, our devices, technology and their RoI will do the rest.

Partners have been complaining that Nortel does not give
good post-sales support, which is why customers prefer rival brands. How will
you deal with this?

A core facet of our corporate strategy for India is to deliver a world-class
and consistent post-sales experience to customers and partners. We have covered
a lot of ground here since the last few years, but this is one area where we
cannot rest on our laurels. Today, we are able to give next-business-day spares in the
country. We also have a 24x7 technical assistance center.

Additionally, we have earmarked several training days so that
our partners are up-to-date on our portfolio. This is an on-going exercise. In
the coming days, this area is going to improve further. We are committed to
provide a world-class post-sales support to our customers and partners.

Which key segments is Nortel focusing on for its
aggressive re-entry into the Indian business space?

We are looking at LAN switching and want to get into the tier-two segment in
a big way. Security is another important area for us, as we have the best
products and would like to get our fair share of the market pie.

The convergence or VoIP market is again a key area for us. We
are seeing a lot of interest in this space and will push hard with our
world-class portfolio. We have a very unique edge over the rest of our
competitors in this area because of our voice experience and we are leveraging
on that to do seamless implementations.

VINITA BHATIA