The secret to a successful marriage is said to be communication. This communication, it could be argued, actualizes the above quote of Samuel Johnson, the eighteenth century English author and lexicographer. Accordingly, weakness in any relationship is a result of lack of knowledge of what the other party wants, desires, or has experienced; the force unleashed by knowledge is without boundary.
One of the business challenges that information technology addresses is precisely the creation and sharing of knowledge within our organizations. Much of that knowledge lies hidden in the data of our transactions and interactions with our business partners. Over the last few years, one type of partner, the indirect sales channel that includes distributors, resellers, OEMs, and other similar partners, has been growing pervasive. Today, more than 40% of sales for U.S. companies come from such companies and Gartner, Inc. estimates that this number will reach 60 - 70% by 2010. How can we access, integrate and share the knowledge of these partners to improve our business intelligence and force?
The answer is PRM -- partner relationship management software that is intended to integrate corporate data warehouses like ERP (enterprise resource management) and CRM (customer relationship management) with the channel. Recently, I talked with Donna Troy, president and CEO of Partnerware, Inc. (www.Partnerware.com), one of the companies with software specifically designed for this goal. Let me share with you some of my newfound understanding of PRM goals and ideals.
1. Integration. Because PRM represents the gathering and storing of a specific slice of information that is originated outside of our businesses, it should integrate with our other business systems and not replace them. The primary barometer of many of our vital statistics is still in production, accounts receivable, customer relationships, quality and the like. We just need to consider collaborative software for an additional piece of knowledge.
2. Scalability. Our use of the indirect channel will evolve and permutate in the future. In addition, for some of us, the use of the Web as a services platform has been slow to happen. In selecting a PRM product, we need to consider our current likely use now with the ability to grow with our channel and us in the future.
3. Configurability. Flexibility to work with different data needs and requirements is essential. While the purpose of PRM is for our information about our channel, the pursuit of that mission must not inconvenience our channel nor leave that channel feeling that there is no value in this information for them. Since that channel will often include many partners with many different knowledge interests, the system must support and be adaptable to many processes. It must also optimize the meaningfulness of any effort of recording sales cycle data.
4. Execution. Our partners are looking for easier ways to do business and to do business with us. PRM offers partners the opportunity to improve their processes by providing a set of tools to better manage the entire sales process in one central place. That one place provides reporting over the lifecycle of the channel both for the partner and us. This includes forecasting, leads management, and even tracking of partner performance. At the same time, our relationships with those partners can be strengthened and loyalty of the channel improved by the mutual commitment to increase the quality of information and resulting decision-making.
5. Security. Since the same software is accessed by multiple channel partners, comprehensive security within the software is a must.
Unlike ERP and CRM, with implementation cycles measured in years reflecting the breadth of organizational impact that such software can have, PRM can have short 90-120 day cycles. The process typically consists of a software vendor learning about the channel relationships and project goals through a series of interviews, some benchmarking of current processes, configuring the software to meet the outcomes of that preparatory work, end-user product training, and post implementation analysis.
Though the price tag of Partnerware's solution at $150,000 and up is prohibitive for some us, regardless of the value, the lessons are clear. Increasingly, the bottleneck to our business success will no longer be within our organizations or the inadequacies of information we gather about ourselves. Instead, our channel partners need more transparency and visibility in our decision-making. We need to continue to innovate ways to harness that data to make us more powerful forces!
CHAIM YUDKOWSKY, CPA, is president of Byte of Success Inc., a technology consulting company specializing in helping small and mid-size business grow. In addition, he is chief information officer of Textilease Corp., a Beltsville, Md.-based uniform and first-aid services company with a focus on the Southeast. His Byte of Success column explores the world of techology for accountants and finance professionals.
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