Channel Champion Blog

Partner ScorecardAt a recent channel strategy conference in San Jose, the keynote speaker Chris Doggett, VP Channels fromSophos (security software) focused his presentation on managing partners throughout their lifecycle. The crux of the presentation presented a formal methodology that Sophos uses to identify where partners are in their lifecycle, measures their potential, and helps to plot a contact and support strategy for each as they evolve.

I was fascinated by this as partner lifecycles is a topic we are conscious of, but it is my experience that very few companies have a formal process for scoring, segmenting, and supporting partners at each phase with an appropriate investment strategy. Investment, in this case, considers manpower time, $ investment via promotions and programs, training and any other resource drain. Why am I fascinated? Because without such a system in place, marketers practice some combination of the following methods to classify their partners and make adjustments in the investment levels of an individual partner:

 Assume that the large are going to get larger and the small will stay small. They design their CAM assignments and investment strategy accordingly—even though it may be difficult to get a higher share from the large ones, or identify the true potential in smaller partners. Many of companies to relay solely on sales volume for medallion assignments are practicing this method.

 Rely on qualitative feedback from CAMs and/or gut feel for how investment practices should vary for an individual partner

 Assume there are two phases to partners: Start-up (new partners), and Mature (partners who for no other reason are beyond the start-up stage). And, like accepting “Friends” on Facebook, have a philosophy that having more is always better than less.

Neither of these approaches seems scientific or defensible, does it? Plus, if you practice one of these methods, you are probably over-investing with some partners, and under-investing in others—which translates to gross inefficiency. Maybe we accept this inefficiency as status quo because we’ve always done it this way but it’s one of those things that are on the list of rainy day items to address the second we get some free time.

The model used by Sophos, as presented by Chris, assigns scores to partners based on a number of criteria. Those criteria, including their target levels include, Pipeline Converted (better than 30%), new deals opened vs. leads (1:25), % new deals opened by partners (50%), Team engagement (40%) and gross margin on closed deals (15%+). The score is assigned to each partner who is otherwise plotted on a quadrant of Revenue $(Y axis) and Investment $ (X axis). Without getting too complex for this blog, those who improve those number from period to period, and improve sales warrant further investment as they are classified as a Growth partner. Those who remain static are identified as Mature and assigned a maintenance program, and those who remain flat or decrease in sales, and don’t improve their performance benchmarks are classified as at risk investments for further review. One of the things that is surprising here is the number of large partners who are assigned to maintenance mode, because there is simply no opportunity for growth via further investment.

We are not saying that the criteria and process is directly transferrable to you, and while clearly oversimplified, the point is that Chris has designed a quantitative way to score partners and provide a foundation for identifying which partners should deserve more attention from his staff and budget, and equally important, those that may be cut back or simply maintained. Considering the resource constraints imposed on most of us these days (read: the need to do more with less), that would be a good thing.