Smart Channel Operations

How Channel Data and Partnering Process can Make or Break your Business

There’s a lot of focus today on the relationship between channel sales and channel marketing, and how these functions need to align better to drive effective partner engagement. The Channel Operations function focuses on the optimisation and management of partnering process, and it’s often seen as a back office function. It’s there to support sales and marketing to do their job, right? Not any more.

Channel Operations Defines You

This paper exposes how Channel Operations is rapidly becoming the channel organisation that defines your company to the outside world. No longer a supporting actor, Channel Operations has stepped forward to take a lead role. Forward thinking organisations need to sit up and take notice. Smart Channel Operations will make or break your business.

What is Channel Operations?

The Channel Operations function has suffered from lack of definition, and lack of clear ownership. Born in the days when someone with an eye for detail had to own the Partner Relationship Management system, and the data that feeds it, Channel Operations was a rag bag of disparate parts.

Today it can include:

• Program Enrolment. The processes and approvals that allow a partner into the program, the contracting requirements, program access rights.

• Compensation models. The policies and procedures that deliver partner margin, including sales goals, revenue accounting and partner performance reporting.

• Program Requirements. The checks and balances that ensure partners are placed in appropriate programs and program tiers, and management of partners between tiers.

• Program Benefit Delivery. The rules, web portals and back office processes that give partners access to rebates, co-marketing, deal registration and other program benefits.

• Partner Data Management. The key information that allows you to understand the profile of a partner, and to reward the right partners for helping you to drive your business.

• Third Party Agency Management. The seamless integration of outsourced service providers to manage complex program requirements and benefits delivery, the on line partner experience.

In a sense this is all the stuff that sales and marketing doesn’t want to have to do. It’s the detail, the process, the back office, that has to be in place to make the channel strategy a reality. So organisationally it gets pushed and pulled between sales and marketing, often with neither wanting to own it, or worst case, the function being split with no single owner.

The Future of Partnering. What Changed?

There are three key reasons why Channel Operations had to get smart, and why it’s now the channel discipline that defines your business.

1. Data Got Big

Partner data used to be name, address, contact information and sales history. Now it’s more data about more partners. Technologies, customer markets, development resources, managed services capability, sales skills, marketing process, and more. More data means more insight, and better partnering decisions.

Evidence of the power of good data is all around us. Retail is showing us that the company with the best customer data is the company that will win. McKinsey have estimated that a retailer using data effectively can improve margins by up to 60% (1). Same is true in the channel. Partner data is no longer how you manage back office, it’s how you grow your business.

2. The Salesman Died

Harvard Business Review reports a study showing that “46% of sales leaders at high tech companies see a shift from a traditional field sales model to inside sales” (2). This “significant change in the sales model” is driven by customer change. End customers are well-informed, particularly the X and Y generations, and want to buy using a mix of on line and off line channels, all seamlessly integrated. It’s what they’re used to when they make home purchases and they bring it work, just like you do.

If your company is hard to deal with, if you’re not using my data to better serve me, if you’re not integrating on line and off line channels, then forget it. I’ll buy somewhere else. Same with partners and partner programs.

3. Resellers Stopped Reselling

Value Added Resellers, the staple diet of the technology channel for so long, are all but gone. The value became everything, and the resell became nothing. We live in a cloud world of influence, content marketing and social selling. Own the influence and you own the sale, whoever might transact that sale. 88% of consumers trust on line reviews as much as personal recommendations (4).

So not only do you have to use partner data as a strategic business asset, not only do you have to be exceptionally easy to work with on line and off line, you have to do all that … across multiple partner types, many of whom are not reselling your solution.

We call that Smart Channel Operations. Smart Channel Operations defines your channel business.

Getting the Basics Right

Marketing has to generate leads, sales has to close deals, and channel operations has to deliver a seamless partner experience. That’s the basics, step one. None of our clients at bChannels would accept a marketing function that doesn’t generate leads, or a sales function that doesn’t close deals. Yet these same clients are lacking focus on channel process that is simply too hard for partners to work with.

And this in a world where poor on line and off line customer experience has one result. The user walks away. As Accenture explains, “customers’ service expectations are rising faster than companies are willing to react.” (5)

If your partners are struggling to work with you, they won’t be partners for much longer. Somebody else doing it better, and the partner will go there. Bain & Company explains that in banking, “the battle for loyalty is won or lost on routine interactions. The leaders excel in everyday transactions”. (6)

Smart Outsourcing of Smart Channel Operations

We see a rapidly emerging trend. Just as sales process is outsourced by many vendors to specialist sales organisations. And just like marketing is outsourced to specialist agencies. Channel Operations specialists are emerging, and taking a much wider responsibility for program infrastructure, for partnering process and for channel experience, on line and off line.

This is not point outsourcing of deal registration, co-marketing or partner enrolments. It’s a wider strategic outsource of these functions together with the expertise and leadership that is required to make channel operations a strategic differentiator for your business.

The process just has to work, that’s a fundamental. The value is in the data insight, the partner experience, and the engagement with the influencer ecosystem. Specialists can do this and more.

In a world where vendor organisations are experiencing constant change, specialist and consistent oversight of critical partnering infrastructure has become a business imperative. It’s also shown to save significant cost through improved working practices and process automation, typically 20%-30% over time (7).

Outsourcing Models

Synergies can be found by outsourcing all or some of the following Channel Operations functions to a Smart Outsourcer like bChannels:

• Outsourced, integrated teams to manage program enrolment, and to support management of program benefits (deal registration, rebating, and co-marketing). Savings are realised through shared resourcing models. Partner experience is improved through single point of contact for multiple partnering processes.

• Strategic outsourcing of partner portal management, including oversight of bought-in services from third-party providers that support partnering process. Savings and improved partner experience are realised through better portal and process architecture, and increased oversight of third-party providers.

• Outsourced management of the data feeds, and reporting outputs from the Partner Relationship Management system. Savings are realised through improved partner tiering and increased control over access to program benefits. Partner experience is improved through customised engagement based on partner profile.

For more information on Smart Channel Operations, and on outsourcing models that deliver the future of partner networks for global technology companies visit www.bchannels.com.

• http://www.mckinsey.com/business-functions/business-technology/our-insights/big-data-the-next-frontier-for-innovation

• https://hbr.org/2013/11/the-trend-that-is-changing-sales/

• https://www.accenture.com/_acnmedia/PDF-10/Accenture-Strategy-GCPR-Digital-Profitabilty.pdf#zoom=50

• http://searchengineland.com/88-consumers-trust-online-reviews-much-personal-recommendations-195803

• https://www.accenture.com/t20160524T055150__w__/us-en/_acnmedia/Accenture/Conversion-Assets/DotCom/Documents/Global/PDF/Dualpub_6/Accenture-Customer-2020-Future-Ready-Reliving-Past.pdf

• http://www.bain.com/Images/BAIN_BRIEF_Guide_to_Loyalty.pdf

• Based on average cost impact of bChannels channel operations outsourcing for technology clients over the three years.

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