Last week’s announcement regarding Q2 revenues and market share for PC vendors and based on Gartner and IDC research was great news for Lenovo and for RelayWare.

Like many companies, Lenovo had begun to see slow or no growth in their mature markets – North America and EMEA but also like many companies who rely on a leveraged model, they knew that the secret of success lay in more effective channel engagement. The whole report was interesting for any hi-tech vendor, but in particular, I thought that this comment may interest CEO’s and other senior executives who struggle to see the connection between partner performance optimization and revenue growth: and hopefully inspire further investment in their own channel development initiatives:

“Lenovo outpaced Acer Group to become the number 3 vendor worldwide. It continued to reap the results of its channel expansion in markets outside of Asia/Pacific, garnering notable gains in the U.S. and Japan. All regions saw positive growth and total volume increased by nearly 23% on the year.”

This outstanding achievement took place just 9 months after selecting RelayWare as Lenovo’s global Partner Relationship Management solution – take a look at the original press release. Lenovo now have the most powerful and sophisticated partner management infrastructure of any of their contemporaries – HP, Dell, Acer, Toshiba and Apple all use a plethora of disparate systems, websites, tools and databases – I know we’ve spoken to them all.

Hopefully these great results will inspire other executives to share Lenovo’s vision and make the necessary investment in their own channel development initiatives.

I received an interesting enlightening communication today from IDC’s CMO Advisor Gerry Murray entitled “Making the Most of Channel Marketing”. I’ve reproduced much of it here with Gerry’s permission because IDC’s independent analysis confirms once again the importance of PRM for effective channel marketing and performance optimization recently highlighted in the Aberdeen report that can be downloaded from our home page.

A recent IDC study of large IT companies found that, on average, channel revenue was $3.7 billion. The average internal channel marketing staff of 53 managed nearly 22,000 partners, equating to $12 million of revenue per internal staff but only half a million dollar per partner.

Partner relationship management (PRM) portal solutions may integrate with these systems, but they still must have a dedicated set of tools that enable channel managers to effectively work with active partners and turn inactive partners active. Customized channel marketing provides turnkey marketing programs that enable partners to directly order and deploy traditional and digital marketing collateral and activities that best suit their needs from a pre-determined selection of inbound and outbound sales and marketing tools.

Over the coming weeks we’ll be covering the key steps to Partner Relationship Management best practice here in this blog.

Last week RelayWare sponsored and participated in the Channel Focus conference in San Diego. It was an excellent event in which, as ever, the focus was on building and developing high performance indirect sales channels for the hi-tech industry. In addition to the many presentations on best practice; partner recruitment, training and enablement, lead management, deal registration, collaborative marketing and so on, a new and very relevant topic emerged.

Whether you’re selling a Cloud solution; SaaS, PaaS, IaaS and so on or you’re currently considering it, you have to consider the impact that doing so will have on your go-to-market strategy and in particular the implications for your indirect sales channels. They will be significant. Your whole PRM or partner lifecycle management strategy will have to reviewed and tailored to address the needs of a new and / or evolving partner eco-system. The fundamental question of how your partners will make money and with that in mind, what your value proposition to them is or will be has to be answered.

You can download Mike Morgan’s presentation where it can be found among a broad range of useful resources in the RelayWare Wizard and we plan to prepare a report in full on the topic over the next couple of weeks. If you would like the notes to the presentation or you would like to discuss it please feel free to contact us.

I spent much of last week at the Enterprise 2.0 conference in Santa Clara meeting customers and analysts, attending the presentations and walking around the expo. It was my first time at the event and I was clearly not the only one. I had an excuse of course; this is my first year living in the Bay Area. But I’m told that in past years attendance by big name customers and sponsors has been limited. Not so this year. Enterprise 2.0 has, it seems come of age.

Many customers I talk to are still blissfully unaware of this new phenomenon. Enterprise 2.0 is defined as the use of ‘Web 2.0’ technologies within an organization to enable or streamline business processes while enhancing collaboration – connecting people through the use of social-media tools. Enterprise 2.0 aims to help employees, customers, suppliers and partners collaborate, share, and organize information. Sharing and organizing information is nothing new in business of course, but Enterprise 2.0 is about how it is shared.

RelayWare has been at the forefront of the development and deployment of collaboration solutions for vendors and their partners for years of course. We have called what we do ‘partner relationship management’ or ‘PRM’ – a term that’s been around for over a decade. But to be more precise, we’ve been pioneering the concept of partner ecosystem collaboration – upstream, peer-group and downstream partner collaboration for manufacturers – PRM 2.0, if you like for quite some time.

Brent Leary defined social CRM rather well as “using any tool available that will allow us to meaningfully engage with more people like [our customers]. It’s realizing people like doing business with people they like – and understanding we love doing business with people we trust”.

So PRM 2.0 could also be termed ‘Social PRM’ which is about taking precisely the same approach with the members of our partner ecosystem. And since those people are the ones most commonly interacting with your customers and those most likely to impact your customer’s buying and ownership experience, don’t you think you need to be including partners in your company’s Enterprise 2.0 strategy for 2011?

I read with interest a blog post at ReadWriteWeb.com that discusses the failure of CRM to positively impact customer service. I have heard this feedback from many companies who invested in CRM strategies but who do not feel, some years later that they have seen an acceptable or even measurable ROI. Of course it’s easy to blame software and systems. CRM should after all be a holistic business strategy not just software and as with all strategies, goals should be clearly defined first and metrics clearly established to measure performance against those goals.

Setting goals and defining metrics can often seem like a cumbersome waste of time when all you really want to do is execute on the strategy. But analyzing ROI becomes impossible months or years down the line if this work wasn’t done. It often leads to the claim that a strategy “didn’t work” so “let’s try another” when actually no definition of what success would look like was ever established.

Of course, one of the other key reasons that companies fail with their CRM strategies is that they do not consider that a holistic CRM/PRM strategy is needed. The fact is that if you sell your products or services through an indirect sales channel, then CRM is only half of the story. A CRM strategy should nurture your customers through the customer lifecycle to increase their propensity to repeat-purchase and recommend your products and services to others.

But in an indirect sales and support model, the individuals and organizations most likely to interact with your customer on a daily basis will be members of your channel partner community – not your own staff. So it follows that at the very least, partners have as much impact on the success of your CRM strategy as you do. In my experience, their impact can be even greater. So does your company have a Partner Relationship Management (PRM) strategy? What provision have you made for PRM methodologies and systems to ensure that you manage the far more complex relationship with your partners? Managing a partner lifecycle involves the same kind of nurturing as a CRM strategy provides for customers but with the added need for maximizing the partner’s propensity to market, recommend and sell for you. And that’s not easy!

In an earlier blog, I made reference to a Forrester statistic that on average, only 31% of a vendor’s channel partner community is actively selling for them. What of the remaining 69% – could they be selling against you? And of the 31% – how many are truly trained, enabled, motivated and supported to represent your company and execute on your CRM strategy – assuming they are even aware of it, understand it and buy into it?

In practice, the answer is usually “very few”. That is why we strongly advocate the development and execution of an integrated customer and partner relationship management strategy. Whether you choose to deploy software to implement that strategy is a discussion for another day!

As the summer holiday season (in the northern hemisphere, at least) draws to close and businesses start to refocus on closing out a traditionally slow quarter while looking forward to the all-important fourth quarter, attention often falls on channel reorganization.  I recently spent time with the VP of North American Channels for a large software company. The conversation centered on their perceived need to cull non-performing channel partners and recruit new “better” ones. I have become quite familiar with US hi-tech channels and know that, after years of consolidation, there really are very few “bad” channels left. Rather, there are lots of poorly leveraged ones.

So I drew an analogy. If you had a consistently poorly performing sales person would you fire them and replace them? “Yes!” she said. Would you exit-interview them first? “Yes of course.” And if you found that the salesperson was not being paid, had never been put through an induction, had never been trained, had no incentives (financial or otherwise), received so sales, marketing or other support from your company…? What if you opened their briefcase and found no product information, pricing, collateral, sales tools and realized that you had failed to provide any? What if you had never actually communicated with the salesperson directly or managed their performance to give them a fighting chance of success? What then?

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