White Paper Channel Data Management: Enabling Data-Driven Decision Making
This white paper presents a method for establishing channel data management as a core competency across all channel-facing departments. It includes a maturity model for driving excellence in strategy, people, process, technology, and data workstreams. Companies that embrace a new approach to channel management based on data-driven decision making will develop stronger relationships with stronger channel partners than their rivals. Companies using this model are gaining channel capacity in a time of extraordinary transformation. For more information visit our website: http://www.zyme.com/resources/white-papers/channel-data-management-enabling-data-driven-decision-making
This white paper presents a method for establishing channel data management as a core competency across all channel-facing departments. It includes a maturity model for driving excellence in strategy, people, process, technology, and data workstreams. Companies that embrace a new approach to channel management based on data-driven decision making will develop stronger relationships with stronger channel partners than their rivals. Companies using this model are gaining channel capacity in a time of extraordinary transformation. For more information visit our website: http://www.zyme.com/resources/white-papers/channel-data-management-enabling-data-driven-decision-making
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WHITE PAPER<br />
<strong>Channel</strong> <strong>Data</strong> <strong>Management</strong>: <strong>Enabling</strong> <strong>Data</strong>-<strong>Driven</strong><br />
<strong>Decision</strong> <strong>Making</strong><br />
Sponsored by: Zyme Solutions<br />
Gerry Murray<br />
January 2016<br />
IDC OPINION<br />
Manufacturers are increasingly reliant on channel partners to accelerate revenue growth and open<br />
new markets. However, channels are typically underutilized and manufacturers' processes that support<br />
them are poorly managed. This is because many manufacturers lack the channel data needed to<br />
create actionable insights. Leading manufacturers have realized the only way to accurately understand<br />
the channel is through data. Manufacturers are adopting channel data management (CDM) as a<br />
means to transform how they manage key channel business processes. CDM is a set of technology<br />
capabilities and best practices that simplify and standardize the collection of a wide range of channel<br />
data at scale and use it to drive channel performance and optimize channel-related processes.<br />
Traditionally, manufacturers have relied on products with a strong brand value to open markets and<br />
drive the channel business model. They have rolled out programs to engage and incent channel<br />
performance. But it is getting much harder to differentiate based on just products and programs.<br />
Ultimately, the business relationships between partners and manufacturers will determine long-term<br />
channel growth and performance. The nature of those relationships will hinge, in part, on how<br />
effectively manufacturers leverage partner data to drive key internal processes such as:<br />
<br />
<br />
<br />
<br />
<br />
<br />
Sales execution and coverage models<br />
Post-sales service<br />
Incentive and loyalty programs<br />
Finance, risk, and compliance<br />
Supply chain, inventory, and distribution<br />
<strong>Channel</strong> marketing<br />
Many vendors do some, or even all, of these things very well for some of their partners — usually the top<br />
5–20%. But very few vendors are able to scale best practices across the entire channel population. As a<br />
result, latent revenue and market share are buried in underperforming channels and latent inefficiencies<br />
and costs are buried in suboptimal channel management processes. IDC's <strong>Channel</strong> <strong>Data</strong> <strong>Management</strong><br />
maturity model provides a road map for companies to develop a mature channel data management<br />
function, which is essential to competing at the scale and speed today's channel requires. A mature CDM<br />
function can dramatically extend the reach and capability of your channel management practices,<br />
enabling you to get the best out of the best partners and leave the rest to your competitors.<br />
January 2016, IDC #US40629815
IN THIS WHITE PAPER<br />
This white paper presents a method for establishing channel data management as a core competency<br />
across all channel-facing departments. It includes a maturity model for driving excellence in strategy,<br />
people, process, technology, and data workstreams. Companies that embrace a new approach to<br />
channel management based on data-driven decision making will develop stronger relationships with<br />
stronger channel partners than their rivals. Companies using this model are gaining channel capacity<br />
in a time of extraordinary transformation.<br />
SITUATION OVERVIEW<br />
<strong>Channel</strong> partners are vitally important sources of revenue, strategic support, and customer experience.<br />
In spite of the channel's tremendous role in overall business performance, it is often under-resourced<br />
and inadequately managed. This is especially true for companies that established their channels to sell<br />
physical products, whether widgets or boxed software. In these models, channels typically were<br />
considered a mere fulfillment arm. The attitude of many manufacturers was, "We gave you great<br />
products and a strong brand, now go sell stuff." In an era when product release cycles were measured<br />
in years and solutions were relatively simple, that attitude worked pretty well.<br />
Today, the channel is vastly more competitive and complex. Large manufacturers can have channel<br />
populations in the tens or hundreds of thousands, making it difficult to optimize performance for all of<br />
them. Top-tier partners have extraordinary market power, making it extremely important to recruit,<br />
retain, and optimize the best channel partners. New technologies such as mobile, social, Internet of<br />
Things (IoT), 3D printing, and big data are changing customer behavior, blending product categories,<br />
blurring market definitions, and opening up new revenue streams. As a result, partners are under<br />
pressure to master the skills needed to deliver new solutions, market to new customers, and run new<br />
business models. Manufacturers that guide partners through these challenges will gain share, loyalty,<br />
and revenue at the expense of those that do not. But doing so requires manufacturers to master an<br />
increasingly complex world of channel data. Key drivers of complexity in channel data include:<br />
<br />
<br />
<br />
The number and variety of entities reporting data — distributors, TAPs, alliances, resellers,<br />
VARs, and service providers<br />
The volume and variety of data types needed — activation, consumption, and opportunities<br />
The depth of data (e.g., serial number, deal registration, and end-user data)<br />
The magic ingredient is data. Imagine having the financial, operational, and behavioral data on<br />
partners to optimize new product launches, margin splits, inventory turns, coverage models, and<br />
channel programs. Imagine being able to show partners — no matter how new or small or niche their<br />
focus — how other partners like them have achieved high return on investment (ROI) on their business<br />
with you. This is all possible, but it requires a new approach to channel data management, one that<br />
goes beyond ad hoc, fragmented, and periodic reporting to a model where data exchange is<br />
embedded into the relationship and data management is supported by dedicated infrastructure and<br />
best practices. Key questions that we address in this document include:<br />
<br />
<br />
<br />
<br />
How can manufacturers progress through IDC's <strong>Channel</strong> <strong>Data</strong> <strong>Management</strong> maturity model?<br />
How can manufacturers leverage partner data for competitive advantage?<br />
How can manufacturers get partners to participate?<br />
What are the benefits for partners?<br />
©2016 IDC #US40629815 2
Progressing Through IDC's <strong>Channel</strong> <strong>Data</strong> <strong>Management</strong> Maturity Model<br />
At even the largest, most leading-edge companies, channel data management is in its nascent stages.<br />
Companies typically lack the organizational expertise, process controls, technology infrastructure, and<br />
data management practices necessary to fully leverage channel data throughout the business. As a<br />
result, this leads to poor decision making in areas such as:<br />
<br />
<br />
<br />
<br />
<br />
<br />
Sales execution: Unable to match MDF to bookings and hard to enforce price and discount<br />
policies and partner reviews based on gut checks<br />
Post-sales support: Don't know the end customer, unable to upsell, and unable to validate<br />
warranty claims<br />
Incentives and loyalty: Incorrect partner payments<br />
Finance: Unable to produce accurate sales forecasts and business plans and slow to<br />
adjudicate partner payment disputes<br />
Supply chain: Unable to analyze how much product partners have on hand<br />
<strong>Channel</strong> marketing: Programs are generic, effectiveness is hard to measure, and ROI is<br />
unknowable<br />
Practitioners we spoke with are aspiring to or are in newly created (two years or less) global CDM roles,<br />
but few of them have the dedicated resources and authority to be truly successful. Leadership and<br />
executive sponsorship are essential but are not enough. The transformation requires an organizational<br />
commitment. People must be assigned to own the processes. Then the processes can be defined,<br />
optimized, and automated. Technology must be brought in to support the new processes and generate<br />
the data necessary to deliver insights into partner performance. <strong>Data</strong> is the final, but most important<br />
workstream. It will provide the scalability needed to better manage, support, and enable every partner,<br />
not just those that justify dedicated human resource commitments. But the data cannot be effectively<br />
captured and leveraged until significant changes are made in the technology platform, organization, and<br />
processes. Table 1 provides a detailed description of the key stages in this journey.<br />
©2016 IDC #US40629815 3
TABLE 1<br />
IDC's <strong>Channel</strong> <strong>Data</strong> <strong>Management</strong> Maturity Model: Detailed Description by Stage<br />
Stage 1:<br />
Ad Hoc<br />
Stage 2:<br />
Opportunistic<br />
Stage 3:<br />
Repeatable<br />
Stage 4:<br />
Managed<br />
Stage 5:<br />
Optimized for Scale<br />
Strategic<br />
vision<br />
Start-up<br />
mode<br />
Extend<br />
product<br />
marketing to<br />
the channel<br />
<strong>Channel</strong><br />
marketing/<br />
management<br />
asserts<br />
leadership<br />
Corporate<br />
owner to create<br />
enterprise<br />
efficiencies and<br />
strategic<br />
alignment<br />
Identify and continuously<br />
deliver the most effective<br />
support to all channels;<br />
consume channel data in all<br />
downstream business<br />
process to deliver value<br />
People<br />
No dedicated<br />
resources<br />
<strong>Driven</strong> by<br />
product<br />
groups<br />
Departmental or<br />
business unit (BU)<br />
or regional CDM<br />
teams<br />
Corporate team<br />
under sales VP<br />
Global channel data leader<br />
with sponsorship and<br />
resources<br />
Process<br />
No clearly<br />
defined<br />
processes<br />
Ad hoc data<br />
capture and<br />
limited use<br />
cases<br />
Single<br />
department to<br />
consolidate<br />
channel data and<br />
expand datadriven<br />
use cases<br />
Centralized<br />
channel data<br />
that<br />
departments<br />
can leverage to<br />
drive specific<br />
use cases<br />
Enterprise/global processes<br />
for data collection, analysis,<br />
and use cases with SLAs<br />
across functions<br />
Technology<br />
Uncertain<br />
what systems<br />
are being<br />
used to<br />
capture<br />
channel data<br />
Existing backend<br />
systems<br />
to house<br />
fragmented<br />
channel data<br />
Departmental<br />
systems of record<br />
dominate (CRM in<br />
sales, ERP in<br />
finance)<br />
<strong>Channel</strong> data<br />
management<br />
platform<br />
implemented in<br />
BU<br />
<strong>Channel</strong> data management<br />
platform implemented<br />
enterprisewide<br />
<strong>Data</strong><br />
No one<br />
knows what<br />
data is<br />
captured or<br />
where it is<br />
Limited,<br />
poorly<br />
managed<br />
channel data<br />
Emergent<br />
standards for<br />
channel data<br />
validation,<br />
enrichment, and<br />
governance<br />
Enterprise/master<br />
channel data<br />
management<br />
best practices for<br />
validation,<br />
enrichment, and<br />
governance<br />
Analytics exposed to partners<br />
to propagate best practices<br />
and drive performance at<br />
scale; data is accurate and<br />
decision grade; connecting it<br />
back to master data is<br />
important so that it can be<br />
used in all downstream<br />
systems<br />
Capability<br />
Opinionbased<br />
channel<br />
decisions<br />
Collect POS<br />
and inventory<br />
data monthly<br />
in predefined<br />
templates<br />
Weekly updates<br />
with support for<br />
multiple data<br />
collection formats<br />
and modes of<br />
transmission<br />
Support for<br />
global data<br />
collection<br />
standard and<br />
advanced<br />
collection<br />
methods<br />
Partner data captured via<br />
automated partner<br />
submission portal with no<br />
manual steps; attention to<br />
frequency of data collection<br />
and depth of incoming data<br />
Source: IDC, 2015<br />
©2016 IDC #US40629815 4
In any maturity model, it is important to benchmark yourself against industry norms and best practices.<br />
In CDM, you would benchmark things such as your coverage and latency of tier 1 and tier 2 data, the<br />
kinds of data you collect, the accuracy of the data you collect, the compliance of your partners with the<br />
process, and your ability to leverage the data in downstream processes to drive business value.<br />
Benefits for Manufacturers<br />
<strong>Channel</strong> Marketing<br />
<br />
<br />
<br />
Customer segmentation is the capability to classify your prospective and current customers and<br />
create groups of similar customers based on their behavioral and demographic attributes. It is<br />
used to make key business decisions for effective marketing, promotions, and product planning.<br />
Partner segmentation is the capability to segment partners and assign tiers by sales<br />
performance, order history, or other value measures and to profile partners based on sales<br />
performance. Partner segmentation data can be used to set or revise sales targets, analyze or<br />
define partner engagement models, map coverage to market segmentation, and improve the<br />
ROI for the channel incentive program.<br />
Campaign management is the capability to design, execute, and manage campaigns to deliver<br />
the right offer via the right channel at the right time and maximize profits. It consumes channel<br />
data to "close the loop" and match sales data to cost data to determine the ROI for the campaign.<br />
Sales Execution<br />
<br />
<br />
Deal registration is the capability to identify deal registrations and match them to actual sales<br />
through partner-reported point-of-sale (POS) data. It is used to validate and pay incentives for<br />
the deal registration based on the actual POS-reported sale. It calculates close rate and cycle<br />
time of a deal, the "net, net price," and supports the automated closure of the deal registration<br />
and automated auditing of incentive payments.<br />
<strong>Channel</strong> sales performance management is the capability to aggregate channel performance<br />
across a geography, a segment (i.e., retail), and/or globally. It is used to drive sales<br />
performance in the channel by providing granular data on sales and inventory management.<br />
Post-Sales Service<br />
<br />
<br />
<br />
<br />
Installed base via POS is the capability to populate installed base records using clean and<br />
enriched POS data. It can be used to create serial number installed base records from POS<br />
data; match activations, license, and other customer data; track the asset; and identify<br />
additional service to customers.<br />
End-customer visibility is the capability to collect POS data with end user and serial number<br />
information to identify the end user of the device or asset within the installed base. It is used to<br />
identify the channel "route to customer" to generate leads and target marketing campaigns into<br />
the installed base.<br />
Warranty and returns management is the capability to validate whether the product sold<br />
follows the terms and conditions of warranty or not (e.g., product manufactured should be sold<br />
only in the United States; if sold outside the United States, warranty is not applicable). If<br />
warranty conditions are fulfilled, so is the ability to derive the validity period of warranty.<br />
Upsell and re-engagement is the capability to build a detailed profile of the installed base<br />
(e.g., product, device identifiers, service, and warranty expiration dates) to identify sales<br />
opportunities for additional product/services and the route to customer. It can be used for<br />
supporting upsell and cross-sell alerts and the advance notifications of upcoming renewal<br />
expiration dates to reengage with customers and eliminate any lapse in service and/or<br />
unnecessary fees.<br />
©2016 IDC #US40629815 5
Incentive and loyalty is the capability to pay partner incentives from POS data or inventory<br />
data submitted by the partner without the administrative burden of a claiming process. It is<br />
used to accelerate partner payments and reduce the cost of partner incentive programs. It<br />
supports the ship and debit process, special pricing, net-net valuations, and other incentive<br />
plans based off of sales and inventory data.<br />
Finance, Risk, and Compliance<br />
<br />
<br />
<br />
Supply Chain<br />
<br />
<br />
<br />
<br />
<br />
<br />
<br />
Revenue recognition is the ability to use the sell-out POS data and to reconcile sell-in/sell-out<br />
data in order to accurately recognize revenue from channel sales net of all MDF and channel<br />
incentives spend. It is used by finance to recognize the financial statement revenue or internal<br />
business unit revenue.<br />
Financial planning is the capability to monitor financial planning and budgeting items from POS<br />
and inventory data reported by channel partners. It is used to extend the financial planning to<br />
include channel sales and incentives to better predict the financial performance of the enterprise.<br />
<strong>Channel</strong> audit is the ability to aggregate sales by partner, inventory, and risk alerts in a<br />
package that can be provided to internal or external auditors to complete channel compliance<br />
audits in an effective and efficient manner. It is used to focus audits on high-risk partners and<br />
high-risk transactions and to reduce the time to audit these partners and/or transactions.<br />
SISO inventory reconciliation is the capability to analyze reported sell-through information<br />
with inventory data to enhance profitability. It is used to detect variances within defined<br />
tolerance limits for validation that the channel partner sales and inventory data are in sync<br />
with. It supports the identification of grey market activities and high-risk partners as well as<br />
improves overall data quality.<br />
Demand forecasting is the capability to consume granular POS data to quantify future demand<br />
at a very granular level. It is used to align inventory balances with predicting future quantities<br />
demanded by sold-to customer or end customer. Accurate forecasting will reduce inventory<br />
balances, reduce stock-outs, and identify excess inventory for supply chain actions.<br />
Inventory tracking is the capability to analyze the current inventory level with recent sales<br />
history to determine the number of days of inventory (inventory aging) at the current sales<br />
level. It is used to identify excess inventory, reduce inventory aging, and avoid inventory writeoffs.<br />
For retail channel partners, store-level POS and inventory data should provide channel<br />
visibility to the larger retail chains.<br />
Stock-out avoidance is the capability to minimize the occurrences of stock-outs at the point of<br />
sale by understanding product availability within the channel to identify locations with low<br />
volumes earlier. It can be used to increase revenue by providing stock at locations where sales<br />
would otherwise be lost and reduce the logistics costs associated with accelerated shipments.<br />
Sell-in/sell-through analysis is the capability to link the sell-in and sell-through POS data to<br />
provide channel visibility from sell-in to end-customer sale or activation. It is used to drive<br />
visibility to channel inventory and overall channel sales.<br />
POS returns and optimization is the capability to evaluate the rate of product returns to<br />
manufacturer, identify specific high-rate partners, and understand the reasons for the return. It<br />
can be used to reduce the associated costs of returns via early detection of potential product<br />
issues and abnormal partner return rates.<br />
Logistics and inventory optimization is the capability that provides the POS and inventory data<br />
to supply chain modeling to reduce the overall number of inventory moves to achieve the<br />
optimal cost of logistics and inventory.<br />
©2016 IDC #US40629815 6
Getting Partners to Participate<br />
Large distributors and partners are likely prepared to deliver a well-defined set of sales and marketing<br />
data. Smaller partners with limited resources, however, will need a tangible and immediate benefit and<br />
a very low overhead process to participate fully and consistently. The general rule for channel data<br />
should be that everything that goes out to partners should be designed to bring data back. The four<br />
broad categories of ways in which manufacturers can capture partner data are:<br />
<br />
<br />
<br />
<br />
Contractual obligation. <strong>Data</strong> should be part of the partner contract. This approach is usually<br />
already in place with the largest partners and distributors. Contractual reporting should cover<br />
all the data attributes required by the manufacturer such as point of sale, inventory, part/serial<br />
numbers, customer identity, and MDF spend. Key to effective data provisioning by partners is<br />
the accuracy, completeness, and timeliness of the data. The best practice in this regard is for<br />
weekly updates. Performance against these requirements should also be factored into how the<br />
partner receives rewards or penalties relating to incentives, certifications, go-to-market funds,<br />
and so forth.<br />
Operationalized data capture. One of the most difficult types of partner data to capture is<br />
marketing and sales activities. To facilitate this, companies should redesign the partner portal<br />
as a SaaS platform that provides a wide range of functionality. The ideal platform will<br />
consolidate all of the interactions with partners by offering personalized access to content and<br />
transactional systems, as well as the ability to execute customer interactions such as<br />
marketing campaigns. By virtue of this consolidation, it captures an increasingly large portion<br />
of partner activities and provides a continuous flow of valuable data to inform channel<br />
marketing and management.<br />
Partner scorecards. Many companies use partner scorecards, but they are typically designed<br />
around lagging indicators that are based on incomplete, outdated, and inaccurate data. A<br />
CDM process will enable much richer and more useful scorecards to be developed. A critical<br />
component of the partner score must be related to the data provisioning process itself.<br />
Partners should be scored on the accuracy, completeness, and timeliness of the data, which<br />
can be linked to a number of valuable perks: MDF allocation, prompt payout processing, and<br />
access to greater data services.<br />
<strong>Data</strong> as a service. A more advanced method is to externalize the database of partner<br />
performance data and make it available to partners in a way that captures even more data<br />
from more partners. By offering access to the data to partners, manufacturers can deliver<br />
specific insights to them on how they can better run their businesses. Partners can query the<br />
database for detailed benchmarks on the financial, operational, and behavioral characteristics<br />
of very similar peer groups. Of course, the level of detail they get in return depends on the<br />
level of detail they provide. As a result, the database is in a virtuous cycle of enrichment. They<br />
should be able to get insight into a wide variety of strategic and tactical questions such as:<br />
<br />
<br />
<br />
<br />
<br />
How many people do I need in marketing, sales, technical, and support roles?<br />
What level of skills and training should people have?<br />
What marketing activities are most effective?<br />
What sales methodologies and plays are most effective and at what stage?<br />
What manufacturer resources and networks should staff be utilizing most frequently?<br />
©2016 IDC #US40629815 7
OPPORTUNITIES<br />
Benefits for <strong>Channel</strong> Partners<br />
While the benefits to internal departments that interact with channel partners are significant, the real<br />
payoff for channel data management is in driving the partner performance curve. By gathering more<br />
detailed data on a broader range of partners, manufacturers can get more revenue from their existing<br />
partner base. The key is for manufacturers to leverage their unique position at the center of the partner<br />
universe. No other company, including your distributors and partners, can possibly have the same<br />
level of insight into how different types of partners perform and why. Armed with that data,<br />
manufacturers can start to identify who the highest-performing partners are and the best practices for<br />
partners like them. These insights can be used to show underperforming partners, specifically how<br />
they can boost their ROI on their relationship with the manufacturer — how should they invest the next<br />
dollar in the relationship: Marketing campaigns? Sales training? Technical certifications? Hiring staff?<br />
Recommendations can apply to every role in the partner organization and might include any or all of<br />
the following:<br />
<br />
<br />
<br />
<br />
<br />
Marketing: Improving competencies, longer-term campaign planning, and new accounts or<br />
buyer types; leveraging social and mobile channels; and understanding buyer's journey,<br />
product mix, pricing, marketing technology or services, customer data management practices,<br />
and so forth<br />
Sales: Updated or more pervasive sales training, new sales plays, and improved qualification<br />
milestones<br />
Technical sales: Advanced certifications and more pervasive technical training<br />
Support: Upsell skills<br />
Executive management: Balancing staff resources<br />
This highly personalized guidance can bring underperforming partners closer to their high-performing<br />
peers. It can be a source of tremendous value and promote loyalty that product and programs alone<br />
cannot. Key benefits for partners include:<br />
<br />
<br />
<br />
<br />
<br />
Improved cash flow and product availability<br />
Proactive help to reduce inventory levels<br />
Benchmarking performance against peers<br />
<strong>Data</strong>-driven account reviews<br />
More effective collaboration to grow business<br />
Of course all this data sharing must be conducted within a good channel conflict structure so that<br />
partners are not helping their direct competitors. But the experience of one partner in one region can<br />
be highly beneficial for partners in other regions with similar business and market profiles. The ability<br />
to propagate best practices with data enables manufacturers to optimize channel recruitment.<br />
©2016 IDC #US40629815 8
FUTURE OUTLOOK<br />
Companies must adopt a new data-driven model for channel engagement:<br />
<br />
<br />
<br />
<br />
<br />
Enterprise/global leadership role and team<br />
CDM platform for data collection, aggregation, analysis, and management<br />
CDM governance to maintain completeness, accuracy, and timeliness of channel data<br />
<strong>Data</strong>-driven channel management processes and investment models across functions<br />
Virtuous cycle of information exchange with channel partners<br />
Leading companies are starting to appoint global heads of channel data management, assess the<br />
(topically sorry) state of their partner databases and data management practices, and deploy solutions<br />
to provide a channel data management platform. These companies are exerting organizational,<br />
process, and technological influence across a wide range of departmental areas — product marketing,<br />
corporate and field marketing, sales, sales operations, and regional channel management. They are<br />
aggressively pursuing the vision of stage 5 maturity (refer back to Table 1). In large organizations,<br />
progress will be measured in years, giving first movers significant market advantage. IDC recommends<br />
that to compete, companies must take the following actions (at a minimum) over the next few years:<br />
<br />
<br />
<br />
Now<br />
<br />
<br />
<br />
<br />
<br />
<br />
Establish a channel data management organization.<br />
Decide where the channel data management leadership should be positioned — in sales or<br />
under the CEO.<br />
Assess channel strategy and objectives against the current channel data management<br />
organization and processes.<br />
Develop urgency and a new story line to move company culture to a channel data<br />
management mentality.<br />
Assess the current state of your partner portal technology and the governance structure<br />
for capturing and managing partner data.<br />
Expand partner advisory boards to include representatives from all segments of the<br />
partner community.<br />
Next budget cycle<br />
<br />
<br />
<br />
<br />
Develop a plan to consolidate the organization's channel data management infrastructure.<br />
Establish key organizational interlocks between all partner-facing departments with<br />
associated service-level agreements (SLAs), where appropriate.<br />
Develop standard taxonomy and governance models for partner data, and roll out globally<br />
across systems.<br />
Plan to establish an analytics function (staff, tools, and governance) to support internal<br />
and external analytics requirements.<br />
Over the next one to two years<br />
<br />
<br />
<br />
<br />
Adopt a data-driven approach to everything related to channel management, marketing,<br />
and enablement.<br />
Reveal insights that both reinforce and challenge current thinking on what drives channel<br />
revenue.<br />
Encourage partners to use your data to help them better run their businesses.<br />
Promote your ability to provide business insights as a key differentiator, and socialize success.<br />
©2016 IDC #US40629815 9
CHALLENGES<br />
Companies are not able to perform mission-critical business operations because of lack of channel<br />
visibility. For example, they are not able to:<br />
<br />
<br />
<br />
<br />
<br />
<br />
Accurately detect and prevent overpayment of incentives/discounts<br />
Understand drivers of supply and demand across the globe, within specific regions or<br />
countries, branch locations, or end-customer demographics<br />
Pinpoint the amount of inventory in the distribution system<br />
Get timely, detailed insight to identify and propagate best practices needed to drive partner<br />
performance<br />
Perform partner profiling and segmentation and measure partner satisfaction<br />
Make confident, data-driven decisions on revenue recognition and reserves<br />
CDM can be a large undertaking for companies that have neglected their channel management<br />
processes over the years. A culture of ad hoc decision making can be hard to change. But technology<br />
is one of the most effective catalysts for change. New systems demand new thinking about how work<br />
routines, holistic processes, and business outcomes can be forged into a core competency. New CDM<br />
solutions such as those from Zyme that provide scalable channel data management capabilities can<br />
be rallying points for channel-facing functions to come together.<br />
Another key challenge is getting partner participation. The CDM program needs to be supported with<br />
marketing and training for distributors, VARs, resellers, and integrators. Every new partner should get<br />
a standard training package explaining the data requirements and usage policies. Every partner<br />
account manager (PAM) or equivalent should also receive training and support resources to help them<br />
assist partners in achieving the highest data provisioning scores they can.<br />
CONCLUSION<br />
By using CDM solutions such as Zyme's, companies can get unprecedented insight into large-scale<br />
channel populations and leverage their position at the center of their channel universe. In addition to its<br />
CDM platform, Zyme provides a global channel directory of over a million partners, support for a wide<br />
range of partner data formats, and a methodology for ensuring partner reporting compliance. With a<br />
deeper understanding of customers, manufacturers can improve regional sales performance and<br />
product planning. Finance and IT benefit from more efficient data collection and financial reporting<br />
enabled by CDM. Other key benefits include:<br />
<br />
<br />
<br />
<br />
<br />
Drive channel revenue<br />
Lower inventory costs<br />
Market more effectively<br />
Rationalize partner investment<br />
Increase compliance<br />
Technology is only one piece of the project, but it is the organizing principle around which change<br />
happens in the organization, the processes, and the data related to channel partners.<br />
©2016 IDC #US40629815 10
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