Resellers try to change with times

A series of recent hires and initiatives at GTSI show some of the common things resellers are doing in an effort to remold themselves and become more competitive as technology offerings increase and federal buyers grow more sophisticated and demanding.

The company recently hired Rick Turner, a 32-year veteran of federal government work, to serve as Strategic Area Executive, Special Programs. Turner spent the final two years of his career at the National Security Agency. Earlier he had served as chief information officer at the Federal Trade Commission, and CIO in NASA's office of space flight before that.

"I had a stint in every part of the government you can think of," said Turner, who started working at GTSI in August.

Turner's task at GTSI is to expand the company's understanding of its government customers, while also catching the agencies up on what the company has to offer.

"The government's moving from building things to buying things," Turner said. "I saw that at NASA, where they went out of the business of building space craft to having them built commercially. [I saw] the same thing at my most recent agency."

Companies like GTSI sometimes don't grasp that agencies really do want to buy comprehensive solutions now, combinations of products and services intended to meet a specific need, he said.

GTSI is one company that does get the message, Turner said. Company chief executive Dendy Young wants "to move the company to where it is providing solutions to government, not just delivering parts that government can put together," Turner said. "What I bring is a good knowledge of what the needs are, at [Defense], at the civil agencies and at the regulatory [agencies]."

Turner's hire is just part of the company's strategy, said Young. GTSI is also developing solutions with broad appeal, using standard products and services, so they can be easily duplicated and sold repeatedly. GTSI Agility, a "mobile office" that includes several communications and productivity applications packed into a travel trunk, is one prominent solution.

"Our customer is a very unusual customer," Young said. "If we were selling commercially, we'd have a product line, we'd have terms and conditions, and we'd go find a customer who would buy under those terms and conditions. When you're dealing with the government, you're dealing with an informed customer. He wants to buy what he wants to buy on his terms and conditions."

GTSI has also been assembling specialized teams to address specific customer needs, he said, 11 teams in all. "In the last nine months we've started up our storage team," he said. "We've also built a security team. We'll continue to build technology teams."

Another company trying to figure out how to evolve is CDW-Government. Earlier this year, CDW-G conducted a formal search for a team of small-business partners to provide specialized services to customers. CDW-G has also provided specialized training for its sales force to help them understand customer needs.

"It's an evolution that's been under way for quite a long time," Shanks said. "We have always provided service to our customers. We have always been involved in building solutions for our customers. Now what we've done is extend that to another level of being able to help them from cradle to grave."

CDW-G has largely chosen not to create pre-packed solutions, he added. "We do that to some extent, but I don't think that's our prime mission in life. Each customer's need is unique. We want to be flexible in that," he said. "Rather than try to predict what the customer is looking for, we engage a highly trained sales force that is immersed in technology."

While resellers are not likely to turn into full-fledged system integrators, they are all trying to add unique features to their offerings, said Larry Allen, executive vice president of the Coalition for Government Procurement. They have to, in order to distinguish themselves from competitors.

"They can command higher margins and be more competitive," he said. "Without doing that, you're in a very commoditized business. If all you're going to deliver is a box, apart from sheer mass, it's tough to distinguish yourself."

"The days of just buying a PC are pretty much coming to an end," agreed Chip Mather, senior vice president at Acquisition Solutions Inc. "Buying hardware alone and having somebody drop-ship it has lost a lot of its appeal."