Crossing the channel

Peter Kovessy
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Mitel CEO Rich McBee didn't mince words when asked in an interview last year to describe his company's performance of late.

Mitel's Richard McBee. (Supplied photo)

"We missed our earnings and guidance, and that's the kiss of death - it shakes the confidence of the market," he said last July.

Since taking the helm of the Ottawa-based telecommunications firm in early 2011, Mr. McBee has reorganized the company, shuffled its executive ranks and reduced its business to just three core divisions.

It's come at a cost, as restructuring costs helped push the company to a $1.2-million loss in its second quarter. But revenues were slightly above guidance, and Mr. McBee said he expects to see further positive results in the months to come.

Shortly after those results were released, Mr. McBee spoke with OBJ editor Peter Kovessy about Mitel's new sales strategy and the restructuring process. The following is an edited excerpt of that conversation:

When I first came on and was doing an assessment of the company, I said, "This is kind of a cool building. It has a nice big atrium, and half the company is on this side and half the company is on the other side. What's this all about?"

And they said, "That's the direct (sales) side, and this is the channel (sales) side.

We can't be together because we'll steal each other's accounts."

I said, "You're kidding me. That's no way to operate." Taking that (wall) down was a key element to our strategy.

We're predominately channel. We have a small set of customers whom we will continue to call on (directly), and keep as house accounts. (But) our bias is always to move things into the channel.

As we took this direct sales force away, we put in place a thing we call an area sales executive. An ASE ... goes out and finds new business, and then drives (that) back into the channel - which does all the terms and conditions, all that stuff associated with closing the deal - but they really spend time finding new business.

That's a key element of our strategy and it is really working. We said we were going to add about 30 of them (in 2011) and we have.

As far as channel partners go ... we won't minimize the local partners, but we've been spending a lot more time working on regional and national partners.

It is very important to have an ecosystem that is well-balanced (with) local partners, regional partners and national partners. With our virtualization strategy, we're actually getting a new type of partner who is primarily an enterprise-type player.

We're really not in it to just say we want as many channel partners as we can get ... That's not what we are looking for. We're looking for relationships with our partners ... and it's working.

Organizations: Mitel

Geographic location: Ottawa

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