There actually came a point when a particular largest software company in the world had just about all its “Managed” partners ask to leave the “Managed” program. Why? It all came down to the expectations the best partners have for the channel account managers (CAM) or partner account managers (PAM) assigned to them. For those who are or who hire CAMs or PAMs, this is food for thought you’ll want to chew on. For channel partners you may find some insight into ways to enjoy more value from those you work with.
Before there were “channel account managers” (CAM) or “partner account managers” (PAM) there were manufacturer’s representatives. These independent teams were very popular among consumer electronics manufacturers that wanted someone in the field calling on the retail stores and other outlets who sold their products to sell more.
When small, new computer manufacturers like Apple Computer at the dawn of the PC era wanted to sell their new products at retail, they knew they couldn’t yet afford to hire a national or global team of representatives to field-manage their outlets, so they engaged these same manufacturer’s representative firms instead.
The goal of the manufacturer’s representative was simple – increase sales!
Bringing a Successful Business Model In-house
As Apple, Compaq, and others became larger they stepped up to compete with the sales might of IBM by building their own field force to drive sales. They leveraged a business model they were very familiar with, the manufacturer’s representative. Their early CAMs or PAMs were trained, motivated, driven and compensated to drive more sales through the various available channels.
Computer sales, however, quickly matured beyond anywhere consumer electronics had ever reached. As business tools rather than entertainment devices, users needed more assistance, more consultative hand holding, to extract enough value from their investments to justify more. Channel representation would have to involve more than just sales management.
Taking “Indirect” Sales to an even more “Indirect” Level
Leaders like Citrix were among the first to recognize that the greatest value channel partners brought was to inspire new applications and new projects that would require their products. They were also among the first to compensate channel partners for influencing the projects that drove the sales of their projects even if the product was purchased elsewhere, from catalog sales providers for example.
Microsoft was perhaps the leader of the strategic approach to partners. They began fielding PAMs who would help their channel partners develop technology solutions that would drive customers to invest in Microsoft products. Rather than push on the sales of their products directly through their indirect sales channels, they instead pushed indirectly on the projects that drove the product sales.
The great side benefit of this strategy was that it aligned these manufacturers with their partners’ need to develop better solutions. Channel partners learned more from their vendors through the efforts of their PAMs. PAMs fulfilled the intent of their titles and truly became participants in “managing” their partners’ business in meaningful ways.
What Goes Around Went Around
Once they had deeply insinuated their PAMs into their channel partners’ organizations, many of the vendors changed the game again. While many tiered their partners between “bronze”, “silver”, and “gold” levels, some took it further by assigning field managers only to “platinum”, “preferred”, “elite”, or “managed” partners. These were usually partners selected for their sales and sales potential.
Senior executive management at manufacturer organizations seized the opportunity. They saw their PAMs as being so deeply entrenched with their partners they were considered part of the business senior leadership teams (SLT). They then required their PAMs to regularly collect updates on each partner’s sales pipeline.
Over a short period of time, this pipeline updating process became the primary activity conducted during PAM/partner meetings. The PAMs soon became most often referred to as the “Pipeline Police.”
Where the PAM had become the source of great support, learning, resources, and help driving results, they had now become a reporting function. Once the partners start to resent this, the end of the relationship has begun.
They Can’t “Pull” This Off Anymore
As the popularity of cloud computing has exploded, the opportunity to push sales through the channel has evaporated. Insightful manufacturers, software providers, and cloud services providers who haven’t recognized the need to change will suffer their shortsightedness soon if they haven’t already. Partners no longer profit much from pushing products. The projects and managed services they lead with now pull the greatest volume of products through with them.
The more you seek to have partners push, the less you’ll get pulled through. It is as simple as that.
Today’s channel partner no longer talks about “solution selling” because solution selling has become the only kind of selling they do. Their continued success and growth is totally dependent upon their ability to constantly innovate new and better solutions. The greatest value vendors can provide to them is to return to the highly productive relationship in which they help partners learn more, gain greater insight into functionality, capacities, and applicability, and sell more solutions that pull products through with them.
Those who work to build better, more adept, more consultatively capable channel partners will reap great returns on those investments. Those who persist in playing pipeline police will watch those pipelines dry up.