There are several reasons for the lack of proper partner coverage:

 

  • Margin pressure from discount structure and overall channel team cost
  • Accelerated signing of new partners
  • Large percentage of poor performing partners
  • Acquisition related additions of many partners at once
  • No use of sizing and structure methodologies for optimization

 

Let’s focus on the last bullet – lack of sizing and structure methodologies.  At the core, sizing is a capacity vs. workload problem.  To size a channel sales organization correctly, you simply need to map the expected workload and let it tell you the capacity you need.

 

Here are the steps to size your channel manager role:

 

  1. Establish the different types of partners you have (Resellers, VARs, OEMs, etc)
  2. Identify their maturity level by how well they know your products and processes
  3. Identify the main activities a channel manager conducts in their function
  4. Establish the % of time spent in each activity category by type of partner
  5. Calculate their current workload based on the above and their current assignments
  6. Make adjustments to assignments and hire/re-deploy as necessary

 

The steps above assume you are not carrying 100’s of dead weight partners.  Clear those out of your channel program or ignore them in your calculations.  For more information on setting clear selection or de-selection criteria read this article

 

Here are some examples from a recent project:

In Figure 1 below, steps 1-3 have already been established and the table represents step 4 – % of time spent on each activity by type of partner.

 

Channel activity time distributionFigure 1.

 

In figure 2 below, step 5 is carried out as we analyze a channel manager’s capacity per type of partner.  Some have extra capacity such as Ed Winn while others are right at the threshold of 2000 selling hours in the case of John Smith.

 

Channel manager time per type of partnerFigure 2.

 

In figure 3 below, we get a sense for John Smith’s partner mix and the hours he can spend per partner across the activity mix.  John can only spend 5.3 hours per Immature Regional Partner per year.  These partners were spread across a large geography which was an indication that he would likely sacrifice more important activities like relationship management or training.  Our client adjusted his partner assignments and allocated some of the partners to others with more capacity.

 

Channel manager time hours per partnerFigure 3.

 

Takeaways:

 

  • Your channel organization is likely operating at a sub-optimal level
  • Your partners will eventually vote with their feet and work with vendors that are optimized
  • Use capacity vs workload analysis to identify imbalances in account assignments
  • Adjust assignments and hire/re-deploy as necessary

 

What sizing methodologies are you using in your channel management function?  For more sales force effectiveness best practices you can leverage for channel management please register for our webinar here:

 

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