1. Eaton Hydraulics introduces new Strategic Channel Partner Model
Eaton has set ambitious growth targets in European markets. The growth places an increasing importance on Channel
Partner companies, who are key to better serving OEMs (original equipment manufacturers) and MROs (End-users) in
different countries and market segments. The man responsible for crafting the channel partner program is Oswald Mutter,
Manager Strategic Markets for EMEA (Europe, Middle East, Asia), who here discussed the plans and how Eaton plans to
align more strongly with key partners.
Strategic Channel Partner Model
QUESTION: Eaton has been established
in European markets for many years. Why
are you re-architecting your distribution
network now?
OSWALD MUTTER: In recent years,
Eaton’s hydraulic business in Europe,
Middle East and Africa (EMEA) has acquired
quite a few companies; sometimes to bring
a service in-house, sometimes to expand
our technology portfolio, sometimes to
improve our presence in a particular region
or sector. Generally these acquisitions had
existing distribution networks, which we
initially left in place to minimize changes
during the integration.
This of course leaves us with a network
architecture that has developed organically.
We felt it was time to strategically review
and optimize the network it so that we can
succeed together. We have done this
steadily over time, but we think that the
time is right to take a more strategic
approach – identify the best possible network,
then take positive steps to strengthen it.
QUESTION: How far have you got with the
process?
OSWALD MUTTER: The majority of the
work is done! We have already designed
the best network architecture and
introduced the concept to our partners,
explaining what it means for each of them.
They have been very supportive, recognizing
that the changes will strengthen Eaton’s
footprint, give them business opportunities
and allow us to give our customers even
better support. The partners definitely
benefit from the changes; their roles will
become stronger and, therefore, make
major contributions to overall success. It’s a
win-win situation for Eaton, Partners and
end-users.
There is still some aligning and optimizing to
do within the network, but it’s very exciting
to see the big picture develop as we get
more pieces of the jigsaw into place.
QUESTION: Can you outline the basic
structure of the network please?
OSWALD MUTTER: Eaton has a
comprehensive range of products with
which we service a wide customer base
across many sectors and regions.
Naturally, the customers want many
different things – products, systems, pre-
sales technical support, on-going service,
maintenance and emergency cover – to
name just a few.
To meet all these needs we have designed
a dedicated “Channel Architecture“ which
clearly allocates the roles of the strategic
Partners. There will be Distribution
Partners, System Partners and Service
Partners. Some Partners will be dedicated
to one role; others will, where appropriate,
stretch across two or more of these roles.
Building and Maintaining Win-Win business partnerships based on:
Mutual
Benefit
Mutual
Competence
Mutual
Respect
Mutual
Integrity
Mutual
Enthusiasm
A framework to strengthen the business relationship between Eaton and Channel Partners
Eaton´s Hydraulics Business
EMEA Strategic Channel Partner Model
Warehouse Distribution System Builders Service & Repairs
Full Vertical
Divisional
Individual
Distribution Partner System Partner Service Partner

2. Each Partner will be active in a “Primary Focus
Area” which defines the product groups, the
territory and/or the market segments.
This architecture creates many different
opportunities. For instance large-scale
distributors and local dealers will be able to
specialize in chosen product groups such as
pumps, valves, hoses and connectors.
Meanwhile engineering companies and system
builders will be able to concentrate on specific
application markets like, for instance,
construction equipment or machines for steel
production and processing.
QUESTION: What is the underlying business
philosophy that drives the program?
OSWALD MUTTER: Eaton wants to develop
its business and to help Partners grow theirs.
Fundamental to this is the concept of “common
visibility whereby the strengths of both Eaton
and the Partner Company are recognized in
combination with the customers and market
sectors that we jointly serve. It is strength
through mutual cooperation or the whole being
is greater than the sum of the parts.
QUESTION: Have you been able to build the
new network from your existing Partners or
have you had to bring new people on board?
OSWALD MUTTER: Now that the framework
is settled, Eaton’s hydraulics business in EMEA
is adjusting the network of partners according
to the architecture. With our existing Partners
we have very competitive and competent
dealers and engineering experts in many areas
and application fields. Yet there is also room for
new Partners who want to share our vision of
outperforming the market by delivering not
only perfect products but also systems,
solutions and first-class support to our
customers.
We know where in our network we need new
Partners and in many cases we are in advanced
discussions with potential new members.
There are a just few niches where we are still
looking for companies that have the potential
to make the grade.
Excitingly, the network architecture has been
designed so that it is flexible and can admit
new Partners if and when there are market or
technology developments.
There is no doubt that both end-customers and
Channel Partners will benefit from our new and
stronger relationships. We have made sure
that customers will receive total, multi-facetted
support delivered by experts, while the
Partners can realize the growth potential that is
part of Eaton’s hydraulic business´ strategy.
QUESTION: Distributors and engineering
companies invariably know their markets well,
how to address them and the level of business
to expect. In short they need enough
independence to be able to adapt to their
market’s needs and regional culture. Have you
allowed for this in your plans?
OSWALD MUTTER: We created the Strategic
Channel Partner Model as a framework to
strengthen the business relationship with our
channel partners. The basic requirement is to
achieve role clarity around each element of the
channel structure. With shared understanding
of roles and responsibilities we will jointly
develop our common potential. Thus we have
a unique relationship with each partner, one
that appreciates them and their expertise
We will always get the best results by
respecting the business model of our partners.
Therefore, we will develop their roles based on
their strategic orientation, capabilities and
degree of participation in the program. For any
given region, Eaton assesses its strategic
objectives and the local market segments in
association with the local partners. Together,
we will be able to deliver a clear defined Value
Proposition for the targeted segments by
combining Eaton`s global presence and world-
class technology with our partners` local
presence and responsiveness.
QUESTION: Eaton is also well known in the
hydraulics business by organizing the biggest
worldwide event for their channel partners will
you continue that practice?
OSWALD MUTTER: Yes, it is extremely
important for us to develop strong and
productive relationships within the network.
The Eaton Distributor Meeting, EDM, is a
unique event in the global hydraulics industry.
It brings distributors and end users together for
education and networking and has a reputation
for being time and money well spent. With a
focus on Training, Education, Awareness,
Feedback, Gathering Market Intelligence and
VOC, it is an opportunity for distributors to
learn from each other and Eaton and bring best
practises home to strengthen their business.
Last year the EDM was held at the well-known
Peabody Hotel in Orlando, Florida. There were
about 1350 delegates representing over 300
companies, including channel partners and
Eaton, from 40 countries. Spread over several
days, there were about 80 workshop and
general session presentations, plus regional
breakouts for the EMEA and APAC Distributors
and a round of social events.
QUESTION: What of the future? How will your
business develop over the next say 5 and more
years?
OSWALD MUTTER: That is a very perceptive
question. I think we can sum up by analyzing
the concept of “global businesses“. In the past
companies were set up to serve a local market
and grew to become regional, national then
international. But that may not have been very
flexible: you had a head office dictating exactly
how business was carried out right around the
world.
Businesses swapped from “international“ to
“global“ when they realized that different
regions and different sectors had their own
needs and procedures – when they became
flexible and responsive to different market
characteristics and cultures.
Eaton’s new channel strategy takes this
concept to the next level. We are not only
responding to the markets needs but to the
local level and the supply chains needs too. We
are putting in a place an infrastructure that
encourages everyone to give of their best, to
reap rewards while supporting others in their
common endeavors.
Contact:
Oswald Mutter
+41 78 784 3813
oswaldmutter@eaton.com
www.eaton.com
Strategic Channel Partner Model