It doesn’t matter if it’s demand creation, reputation management, sales enablement or the other host of tasks that sales and marketing need to manage. When it comes to a problem, b-to-b organizations shoot first with a technological implementation and ask questions later.
Often at the heart of these counterintuitive moves is the lack of a decision framework to understand specific requirements beyond what can be found at vendor Web sites. In the past, we filled this need on the demand creation technology front, and now turn our attention to a concept we call Channel Management 2.0 that is built on transparency and visibility for organizations and their partner networks. To help organizations define their requirements and choose appropriate vendors, SiriusDecisions has developed the Channel Management Technology Stack (see below), which identifies four layers of functionality necessary to optimize channel sales and marketing efforts. In this article, we will explain each layer of the stack and its corresponding functionality.
Layer One: Partner Management
Poor visibility into channel activities and performance occurs because organizations lack a centralized technology platform to interact with partners and to provide content and information to help them better position and sell their offerings. Your partner management platform should allow you to distribute leads, as well as manage partner programs, marketing funds and relevant collateral. Accomplishing this requires the following four components:
Portal. While portals often get a bad rap as a static content repository, when implemented properly they provide an effective framework that enables vendor/partner interaction. Your portal is the central interface where partners can transact a wide range of business; it is an enabler of the subsequent functionality we will discuss.
Community. Many organizations are integrating social networks into their partner portals, forums that allow partners to connect with each other, and to share ideas and best practices. They also can become a platform to communicate across an entire partner universe, as well as to gauge partner perceptions and opinions regarding channel policies, products and solutions.
Integration and synchronization. Channel management can usually be purchased as a module in a CRM system; if your organization hasn’t done so, it will need to integrate a channel management platform into your existing CRM system to enable bidirectional communication. In addition, some sales organizations require a desktop application that allows them to be productive even when they are offline; for such organizations, data synchronization can facilitate the exchange of lead and deal information between you and your partners.
Partner marketing. Product catalogs that include pricing and product updates are critical, as is collateral that helps partners position your offerings more effectively. A platform that manages, submits and tracks the approval of MDF/co-op funds is equally important and will allow your channel marketing managers to plan specific partner marketing events, as well as manage costs, schedules, expenses and payments.
Layer Two: Partner Lead Management
A cornerstone of a successful channel program is your ability to route and distribute leads to the appropriate partners. To do this, you’ll need a facility to build and manage business rules that can capture and assign leads from a CRM application and provide notifications, escalations and reassignments. Essentially, this is the “brain” of your channel management platform and should include the following functionality:
Lead scoring. Based on criteria established by the manufacturer, you will need to assign scores, ratings or categories to leads. This will trigger leads to be delivered to partners; trigger levels may vary according to a partner’s skill, product line or geography.
Lead routing. A wide set of criteria typically affect how leads are assigned. You can choose to route leads to specific partners or to a shared pool where any partner or group of partners can grab them. You can also configure the filtering of leads, allowing only certain types of leads to go through or certain partners to view them.
Lead distribution. Channel or sales managers should be notified when lead processing rules are not met; for example, that a lead has not been acted upon within a certain timeframe. Your platform should be able to pull leads from partners that don’t act on them and reassign them according to established rules.
Lead tracking. It is critical to capture how channel partners process and convert leads into opportunities, as well as partner feedback about lead quality. We recommend establishing a list of lead quality measures to which partners can respond, particularly when leads are rejected.
Layer Three: Partner Sales Management
The ability to track and process sales opportunities is vital to managing channel partner performance; any channel management platform should allow partners to enter and register sales opportunities into the system. We have identified the following four components necessary for managing partner sales:
Opportunity management. To provide transparency, partners must be able to create, update and manage all lead, opportunity and account information associated with the lead process or sales cycle. This should also include adding pricing information, quotes and other details pertinent to the sales record. Registering deals ensures that partners will get full margin credit for sales in cases where other partners also sell to a specific customer.
Pipeline and forecasting. You will need to work together with your partners to manage the sales pipeline and determine if additional resources are needed to meet a particular sales forecast. This will require specific functionality that enables the movement of opportunities through the sales pipeline and the determination of which deals are likely to close during a given quarter.
Deal configuration. Partners need to easily generate quotes and then email or fax them to customers. Deal configuration enables partners to check inventory, submit and track orders, and generate quotes based on agreed-upon discounts, as well as to request additional discounts above and beyond negotiated margins. These situations frequently occur in competitive deals; in these cases, it is critical to quickly escalate the approval of extended discounts.
Partner service. Your channel partner contacts will need to view their contracts, as well as to monitor customer maintenance renewals (as they are such a large part of their revenue streams). In addition, channel partners need to track defects, recalls, merchandise returns and warranty expirations if applicable.
Layer Four: Partner Reporting and Analytics
Transparent, visible channel performance comes from your ability to track the progress and percentage of leads that turn into closed deals, as well as pipeline trends and the effectiveness of individual channel marketing programs. Such functionality is typically available through static or custom reports and analytics defined as follows:
Reports. Your platform should provide a set of pre-configured reports, as well as a facility to create custom reports. Specifically, you’ll want reporting that tracks the distribution of leads across the entire channel and for each individual partner, which will allow you to gauge each partner’s performance with regard to lead management, opportunity management and closed deals.
Analytics. Analytical data is critical to analyze how MDF or co-op funds impacted partner sales or forecasts. A data gathering facility is also necessary to determine how individual partners performed in comparison to their peers in a variety of areas including lead management, opportunity management, pipeline and closed deals.
Effective channel management is more than simply an accounting program to track channel funds or a deal registration system to track closed deals; it is a set of processes and technologies that enable a transparent, accountable channel. The Channel Management Technology Stack defines the layers of functionality that make up a true Channel Management 2.0 solution, a tool that can be used to help frame your requirements and evaluate a vendor’s offering. Whether you choose a single platform or partner with more than one vendor, remember that tight integration is required across all the layers of the stack for a truly integrated solution.
About the Author:
SiriusDecisions, a leading source for business-to-business sales and marketing best-practice research and data. SiriusDecisions Executive Advisory Services, Consulting Services, Benchmark Assessment Services, Learning and Events provide senior-level executives with the sales and marketing operational intelligence required to maximize top line growth and performance.
©Sirius Decisions, 2009. Reproduced with permission.