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Channel Matters Blog > December 2013 > Beyond the Numbers: Transitioning Your Go-To-Market Model – Part 2

Beyond the Numbers: Transitioning Your Go-To-Market Model – Part 2

by Rich Blakeman
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More and more sales organizations are moving to a hybrid go-to-market model or looking to increase the contribution from indirect sales in 2014. In part 1 of this series, I talked about how to minimize the disruptive influence a change in go-to-market tactics can have on your customers. In this post, I’ll focus on the channel and your direct sales force and show you how to ensure that the transition promotes their productivity and performance.A great example is Dell’s recent announcement that as part of a “cultural transformation” they will be opening up 200,000 existing accounts to their partner channel. This transition is a huge undertaking and is bound to have a dramatic impact on both channel partners and direct sales.

 

In a hybrid model such as Dell’s, engaging the direct sales force is essential. Without their support, channel conflict issues derail any progress. But direct salespeople tend to be independent. They see themselves as the owners of their territory, and they may not welcome additional feet on the street. Sure, they collaborate with internal teams, but that’s all in the name of closing business.

To address this, some organizations take the stick approach when transitioning to a hybrid model. They assign a revenue number to the territory, specifying a percent of the total goal that must come from the partner channel.

I liken this to the approach some parents take when trying to get their children to eat broccoli. A few kids will find the will to eat it because Mom and Dad said they had to. (I don’t personally know any of these kids, but I’ve heard they exist.) Some will drop it on the floor or feed it to the dog, knowing Mom and Dad will give up eventually. Others will just leave the table, stubbornly refusing to comply even if it means they must go without dinner.

While they might be a bit more grownup about it, direct salespeople will take a similar approach. If you tell them that 50 percent of their revenues must come from channel partners, some will figure out how to make it happen. Unfortunately, consistency of performance will still be an issue. Others will fail, knowing that management won’t really care where the revenue comes from at the end of the quarter or year so long as it’s there. Others may leave the company for a sales organization where they don’t have to deal with any irritating channel partners.

Don’t get me wrong. I’m all for metrics, but most sales organizations have better luck achieving those metrics when they help the salesperson understand what’s in it for them. Admittedly, my broccoli analogy falls apart here because very few kids really care that broccoli is good for them. Thankfully, you can use the typical direct salesperson’s ingrained sense of enlightened self-interest to gain compliance.

So how do you help salespeople see what’s in their best interests? You show them how they can make more money. Sales compensation is probably the strongest “carrot” any organization has at their disposal, and Dell is introducing “compensation accelerators” to incent collaboration between their direct sales force and the partner channel. However, before following Dell’s lead, channel organizations need to be sure they’ve built the proper foundation. This takes us right back to two concepts we’ve talked about recently: Market Mapping and Channel Segmentation.

First let’s review the concept of Market Mapping. I touched on this a couple of weeks ago in a post on The Importance of Channel Alignment. In short, Market Mapping takes into account aspects such as market maturity, business strategy, product lifecycle and the customer’s buying processes to determine the best route to market for each product line/market segment. This is a concept we cover in some depth in our Channel Success Essentials workshop and in our one-on-one consulting work with sales organizations.

Channel and sales leaders need to use the Market Map to show the direct sales force that their time is better spent focusing on certain segments while leaving others to the channel partners. A good example is the high-volume, low value-add sale. While the direct salesperson may spend months trying to close a big deal, if the customer is buying on price, there’s a good chance this deal will be lost at the 11th hour when a channel partner or competitor submits a lower bid. It would have been a better use of time to leave the opportunity to the volume channel partners to fight it out on price than to get in the middle of that battle.

Channel Segmentation is the second critical piece of the solution. Geoff Wright, Executive Vice President at Channel Enablers, covered segmentation very well in his recent post: Should You Assign Your Best CAMs to Your Best Partners?

To review, there are three main types of partners:

Achievers – those partners who contribute the most with very little assistance from your sales team
Believers – partners who aren’t quite up to snuff, but are willing to make the investment
Deceivers – partners who suck up a fair amount of resources, but contribute very little at the end of the day

When direct salespeople balk at working with the channel, it may be that the only channel they’ve been exposed to are the deceivers who corner them at every sales event and complain about how the organization doesn’t appreciate their contribution. The number one take away from your discussion with direct sales should be that they are NOT expected to work with the deceivers.

Working with the believers is an option, especially when there is a believer that adds a unique, complimentary skill that the salesperson needs to close the deal. These are also the channel partners that can best address the high volume, low value-add markets mentioned earlier. However, if direct sales is expected to work with believers, the Channel Account Manager should be accountable for ensuring the channel partner is enabled to play their part in the sale.

The direct salesperson’s most powerful allies are the achievers who don’t need handholding to make the sale. He or she can assign opportunities to these partners, knowing that the opportunity is in good hands and the effort needed from direct sales will be minimal. The added benefit of this alliance is that there is something in it for your achievers as well. They will have some of the best opportunities thrown their way, strengthening their relationship with the organization. When both the direct sales team and the channel partners adhere to the defined Rules of Engagement, the hybrid model becomes a win/win all around.

I’ve seen the power of Market Mapping and Channel Segmentation transform many sales organizations, but if there’s one thing I’ve learned from my decades of working with channel organizations, it’s that every transition is unique. Both channel partners and direct salespeople can throw curve balls at any time. If you’re having challenges with your go-to-market transition, reach out to me at rblakeman@millerheiman.com.

Last modified on 3/5/2014 9:50:35 AM
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