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Hands in the cookie jar: Are vendors pinching employees from their partners?

The IT skills shortage has put a strain on the channel’s hiring ability, making it difficult for partners to retain sought-after staff and even harder to fill the vacancies left when an employee leaves. But there are murmurings in the channel that vendors are making this problem more difficult for their partners to solve, by reaching down and pinching their best employees to fill their own vacancies.

Any regular user of LinkedIn will likely have seen numerous people change their job roles from ‘vendor partner manager’ at a reseller to ‘account manager’ at that same vendor.

One reseller boss CRN spoke to, who wished to remain anonymous, said he had lost seven candidates to the same tier-one vendor in less than a year.

A second managing director said he loses on average two employees to a vendor every year, but that the figure has been higher than this over recent months.

A third boss told us that the biggest vendors are in the middle of a recruitment war that is seeing them pinch each other’s employees – but added that when this fails they are looking into their channel partners as a contingency plan.

It is telling that all three resellers were happy to speak to CRN about the topic, but only if their identities were hidden.

The situation puts partners in an awkward position where they are unhappy with how a vendor is treating them, but are not in a position to do anything about it. Breaking off a relationship would be counterproductive, and publicly criticising the vendor or throwing their toys out of the pram could put that relationship in jeopardy – meaning that they just have to get on with it.

“It is the elephant in the room,” one partner told us. “But ultimately I can only support a customer if I have a wide range of products and the knowledge to support that.

“If a vendor has taken my best employee, I still have to be nice to that vendor so they’ll lend me the guy back if I need him, and to make sure we are still a route to market for them.

“Otherwise they’ll up sticks and take all the value I’ve invested in the person they’ve poached off me, and supply it to my competitors. It is a cleft stick and there is not a lot I can do about it.”

Vendor promised land

This trend is however a two-way street and, in some instances, it can be the candidate pushing for a move to a vendor rather than the vendor poaching employees.

Research conducted by channel recruiter Robertson Sumner last year found that, on average, a sales director at a vendor will receive on-track earnings of £230,000 – £80,000 more than at a reseller or MSP.

Speaking to CRN, Marc Sumner, managing director of Robertson Sumner, said the recruiter has seen “unprecedented demand” from senior reseller employees looking to get out of the channel. He said that over 50 per cent of the senior reseller candidates Robertson Sumner worked with in Q1 are refusing to stay in the channel.

But the issue runs deeper than salaries. Sumner said that senior staff in “generic” resellers are beginning to worry that they are not specialised in a specific area because they have a broad portfolio of products, and so see working for a vendor as a way of obtaining a specialism.

“If you’re a reseller candidate and you’ve been working for a generic reseller, you’re in no man’s land,” he said. “You’re a jack of all trades and a master of none.

“You’re not specialising in anything and that is quite a dangerous place to be because if you don’t have another specialism you’re a commodity.

“A lot of candidates think if they carry on like this, in three or four years they’ll be worthless to the market.”

Sumner referred to one candidate he is working with who has a client book that’s worth £1m in gross profit,

but is refusing to move to another reseller. Instead, he wants to work for a vendor and sell direct into the

mid-market.

“We’re having people from Computacenter, SCC and CDW coming out and saying they don’t want to work for

a VAR,” Sumner added.

“If you’ve got people who have been in VARs for 10 years saying that, I would say it’s quite worrying to be in a reseller at the moment.

“Specialist VARs will still do well because they can earn good money, but I worry about the more generic players.”

Too close for comfort

At a time when digital transformation is booming and public cloud migration is gathering pace, the biggest vendors in the world are making a point of publicly declaring how important their partners are to them. Partners in these new spaces are no longer fulfilment vehicles, they are essential to rolling out large, complicated solutions.

This is beneficial for the specialist partners that are thriving working hand in hand with vendors. But in the context of this subject, it could pose a threat.

A byproduct of vendors working so tightly with partners is that they are given more of an opportunity to spot talented people within these partners.

One boss CRN spoke to said: “The problem is that if you work with them closely, they know your people and your people get to know them. It’s a massive problem.”

Will Rowe, sales director at MSEmploy, said this is causing friction between vendors and partners. MSEmploy is a Microsoft partner specialising in placing Microsoft-trained staff in the vendor’s channel partners.

Rowe said partners are becoming frustrated at adjusting their resources to fit Microsoft’s demands, only for Microsoft to swoop in and snap up these resources.

“A fair amount of guidance is given to the channel on what they should be doing by Microsoft,” he said. “For example, they could say at the moment they should be focusing on everything Azure, or suddenly it could be Microsoft Teams.

“The channel then has to react to that in terms of their hiring, budgeting, and looking at whether they need to upskill or bring people in.

“So the vendor is saying what they want and saying where they see things growing, and then they’re at times taking people from the channel to work for them.

“There is a question around whether they should be taking people from these organisations if they’re the ones that are setting the road map.”

One vendor CRN spoke to said the answer is to not take any employees without the partner’s blessing.

Neal Lillywhite, vice president of channel EMEA at Forcepoint, said it is the cybersecurity vendor’s policy not to take on staff from partners unless the partner is involved in the decision.

“I am very uncomfortable with it as it’s a massive trust issue,” he said. “Most vendors have got open headcount – it’s a seller’s market at the moment and huge recruitment is going on everywhere. But a vendor that takes all their staff from partners doesn’t have a partner base. If you don’t have trust with your partners you have a transactional relationship and if you have a transactional relationship then generally you are not successful.

“There are times when staff at partners want to leave and work for a vendor. There are times when we’ve been approached but we’ll make the individual aware that we need to speak to the partner, and if they’re uncomfortable with it, that’s the end of the conversation.”

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