HPE To Subcontract More Than 200 Sales Positions To Insight Enterprises

Insight Enterprises expects to hire more than 200 inside sales workers from Hewlett Packard Enterprise's Conway, Ark., facility as HPE looks to better manage labor demand.

The HPE labor agreement will help Tempe, Ariz.-based Insight -- No. 13 on the CRN Solution Provider 500 -- grow its inside sales operations around the small to mid-sized business and public sector segments of the U.S. market, according to a filing late Tuesday with the U.S. Securities and Exchange Commission (SEC). Insight said it expects more than 200 new employees to be on-boarded by the end of August.

’This arrangement and the additional dedicated resources will enhance Insight’s expertise in the data center, expand its sales coverage in the SMB and public sector markets and provide the potential to accelerate data center solution sales,’ Insight wrote in the 8-K filing. The company declined to comment further.

[RELATED: HP Confirms Enterprise Services Ciber Subcontracting Arrangement]

Employees transitioning from HPE to Insight will be offered an equitable compensation package, with comparable salaries, benefits and commission payouts, according to a source with knowledge of the situation. The majority of HPE’s Conway-based employees will be affected by the arrangement, according to the source, and will need to decide in the ’near term’ if they wish to stay on as re-badged Insight employees.

’There are employees who will move from HPE to Insight, and continue to work for HPE’s EG [Enterprise Group] Inside Sales organization,’ HPE said in a statement, adding that it expects all employees to have a role in the new model. ’HPE will continue to own and manage the end-client relationship.’

Members of HPE’s EG inside sales team in Conway were responsible for making sales calls around server, storage, networking and converged infrastructure offerings, according to the source. Both Insight and HPE will be located in the same building in Conway, the source said, though each company will have completely separate workspaces.

Insight said in its filing that the employees it’s acquiring have specialized knowledge of data center solutions, making it possible for the solution provider to better meet growing demand for core infrastructure. The arrangement isn’t expected to have much impact on Insight’s 2016 earnings performance, though the company said it should provide a foundation for growth in 2017 and beyond.

The agreement with HPE should help Insight with a year-old initiative to transform its SMB sales engagement model by reexamining its hiring, training, development and compensation practices. The solution provider said it’s also looking to revamp its sales enablement through digital marketing, web automation and cloud aggregation.

Jeromy Siebenaler, Insight’s vice president and chief cloud architect, told CRN last month that the company is investing heavily in its cloud platform to build out Infrastructure-as-a-Service consumption abilities and enhance management capabilities through improved dashboards.

This arrangement between HPE and Insight appears very similar to one revealed in August between Hewlett Packard’s Enterprise Services group and Greenwood Village, Colo.-based solution provider behemoth Ciber -- No. 37 on the CRN SP 500 -- where a ’small number’ of application delivery services employees moved from HP to Ciber.

HP’s Enterprise Services Group indicated at the time that it wasn’t unusual to enter into subcontracting relationships with other system integrators.

HP announced last year that it was aiming to take $2 billion in costs out of its enterprise services business over the next three years.