A survey of 211 channel chiefs suggests that the negative impact fragmented channel processes are having on partners is more widely known than many IT vendors care to admit.
Conducted by Forrester Consulting on behalf of Model N, a provider of a channel automation platform, the survey identifies the top two obstacles channel executives are struggling to overcome as the shortening of product lifecycles (53%) and lack of appreciation for quality sales data (52%).
Other top-of-mind issues include reliance on manual tools/processes (33%), lack of a unified view of channel sales data and activities (32%), technology silos (29%), inconsistent sales data entry (28%) and poor data integration/merging capabilities (27%).
While issues such as product churn have a major impact on the profitability of any given vendor, they also ultimately have an adverse impact on channel partners, according Chanan Greenberg, senior vice president and general manager for high tech at Model N. He said IT vendors that don’t automate the management of channel processes are much more likely to find themselves in conflicts with channel partners involving compensation.
“Automation drives better outcomes,” Greenberg said. “That’s something partners should care about passionately.”
Savvy channel partners will drive more business toward IT vendors that they know not only have reliable compensation processes in place that result in them being paid sooner, Greenberg said.
Automation also makes it possible to distribute sales leads before they go cold, Greenberg said. That’s been an especially critical issue in the last year because COVID-19 restrictions have made it difficult for channel partners to engage new customers on a face-to-face basis, he said. Sales leads that are generated in a timely fashion by IT vendors that have invested in digital marketing platforms provide partners with a critical lifeline during what continues to be the most challenging economic climate in memory, Greenberg said.
Are your vendor’s processes automated?
It’s not clear to what degree channel partners are evaluating the processes IT vendors employ to engage their partners. However, most of them are at the very least aware of which IT vendors are driving the most revenue for their business. It’s up to each channel partner to determine how profitable that revenue is based on the additional services they are able to provide.
The challenge channel partners encounter, of course, is that it’s often difficult to assess how automated a channel process is before engaging with a vendor. Many channel chiefs don’t necessarily want to invest in automation, because it can take 18 months to implement at a time when the average channel chief might only hold that position for about a year, Greenberg said.
Regardless of channel chief tenure, however, it’s clear channel partners have a vested interest in automation. IT vendors that rely on manual processes involving spreadsheets are almost always going to be costlier for a channel partner to engage — if for no other reason than the simple fact more errors are likely to be made whenever data is re-entered into another application.
Process automation may not always be the first thing that comes to mind when a channel partner engages a new IT vendor. However, within a few weeks, it almost always, in one form or another, becomes the most dominant issue adversely impacting what should be as fruitful a relationship as possible for all concerned.