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Partnering: The New Growth Strategy
At first, for most enterprises managing partner relationships was simply a way to offer channel partners access to collateral and customer information. Now, when indirect sales channels can contribute substantially to the bottom line, partnering has become a growth strategy because companies can increase market share quickly by finding partners with expertise in desired areas.
Posted Apr 30, 2001
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At first, for most enterprises managing partner relationships was simply a way to offer channel partners access to collateral and customer information. Now, when indirect sales channels can contribute substantially to the bottom line, partnering has become a growth strategy because companies can increase market share quickly by finding partners with expertise in desired areas.

Pushing relevant information and multimedia collateral to partners through a Web portal, once considered an impressive feature, is now the price of entry into the market. As online channel "touch points" multiply, so does the complexity of managing and organizing them. Collaborative commerce requires tools that will help companies get to market faster and create barriers for their competitors.

Dennis Ryan, president and CEO of Allegis Corp., a PRM provider in San Francisco, lists three drivers of opportunity in his market: "dependence on value-added partners; disruption of traditional value chains and forms of distribution caused by the Internet; and emergence of sell-side marketplaces as a way to conduct commerce, particularly collaborative commerce." In response to changing conditions, PRM products are now incorporating aspects of knowledge management technologies.

Partner Portals

Portals are well established as a way to deliver information to employees, customers, partners and suppliers. But while all of these kinds of users require certain basic functions, a partner portal has specific requirements. It should include tools for partner recruitment, profiling and training; program management, including programs for market development funds; closed-loop lead management and forecasting; targeted, multimedia collateral access; and cataloging, pricing and configuration.

Finding and recruiting strategic partners is important to many companies. A PRM solution can help this process by publishing program and qualifications criteria, automating registration and qualification, and capturing profile information to use when matching customer leads to appropriate partners. Once a partner signs on, the PRM solution should help to train sales and marketing teams about your company's products and services, and to create mindshare so partners will be ready and motivated to sell your product and services.

PartnerConnect from ChannelWave Software Inc. of Cambridge, Mass., offers a way to bring partners together to match their needs and strengths. It gives them an opportunity to browse other partner profiles and build teams, solutions and business opportunities together, which can lead to increased sales.

PRM solutions should also help to track and distribute products. When your partners can manage their expenses and results easily, they will feel more committed to the partnership. Products from Partnerware Inc. of Austin, Texas, have built-in business rules designed to motivate partners to participate in sharing and using information.

Knowledge is the Key

Knowledge management techniques such as collaboration, data mining and expertise locating are finding their way into PRM applications. It seems obvious that a PRM solution should help your company feed the best leads to its most appropriate partners. But without the ability to analyze data in real time, it's difficult to determine which leads are the most valuable.

Allegis, Intelic Software Solutions Inc. of San Jose, Calif., and OnDemand Inc. of Menlo Park, Calif., are incorporating analytics into their PRM solutions. The large CRM vendor Siebel Systems Inc., recognizing that this kind of data analysis is necessary both to funnel leads appropriately and to determine the effectiveness of marketing campaigns, has aligned itself with OnDemand but says it will also continue to develop such functions internally.

"Analytics are really fitting in," says Kevin Scott, industry analyst at AMR Research Inc. in Boston. He notes that companies such as Aprimo Inc. of Indianapolis and Youcentric Inc. of Charlotte, N.C., sell software to capture, share and test best practices. he says. Some PRM products, as from ChannelWave and Partnerware, assume that partnerships are short-term relationships and are designed to get the most value from that lifecycle in the form of reusable processes.

Incorporating customer service into PRM allows partners to become more tightly integrated into the sales cycle. Onyx Collaborative Service from Onyx Software Corp. of Bellevue, Wash., offers an online environment with Web self-help, service incident tracking and customer surveys that collect important customer information. Siebel's eChannel creates a knowledge base of service solutions and FAQs and can log and pass on service requests.

Some PRM applications focus on sharing content, retaining brand loyalty and building community on an online exchange. Allegis offers Market Partner for online marketplaces, which includes complex business profiling and self-service catalogs. It assists businesses in joint marketing and communications programs, matches buyers to sellers and helps participants with complementary products and services to cross-sell and upsell. Market Partner also analyzes sales performance.

Community Conscious

Webridge Inc. of Beaverton, Ore., has an online exchange solution, Webridge Private Exchange, that offers community-building and content-building tools and publishing capabilities. It routes content to specific individuals based on customer-defined business rules and supports versioning and check-in/checkout to coordinate collaboration between multiple authors.

Building community is important in managing potentially conflicting relationships throughout the demand chain. Ricoh Silicon Valley Corp., a network appliance producer, was looking for a PRM solution to foster community with channel partners. Its product, eCabinet, digitally captures documents in a network and indexes them for keyword searches so users can share critical business knowledge. Ricoh wanted to open a new channel and recruit partners to grow this business, according to Janice Quelch, senior director of worldwide marketing in Cupertino, Calif.

According to Scott, to be effective in today's economy companies must stop thinking of PRM as a standalone application and begin to see it as an approach to information management that ripples through the value chain. "You'll have your PRM implementation being able to talk to your ERP application and your supply chain application about forecasting, especially seasonal trends," he predicts. "Partner relationship management is going to become a way for verticals, like the auto industry, telcoms, high tech and financials, not only to push information out but also to pull information in about their customers."

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