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Channel Matters Blog > May 2014 > 5 Root Causes of Cross-Channel Conflict

5 Root Causes of Cross-Channel Conflict

by Jan de Leon
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Cross-channel conflict is the bane of many sales leaders. But is conflict between channel partners and territory managers really inevitable? Eliminate these five common causes of channel conflict and restore harmony in your organization.

Indirect sales
accounts for the majority revenues in many industries. Selling through channel partners promises significant gains in productivity and coverage. When implemented properly, an indirect model can also drive down the cost of sales.
 
Yet, some 75-80 percent of these organizations continue to maintain a direct sales force. These territory managers (TMs) are responsible for overall territory revenues, and channel partners are just one of the routes-to-market open to them. Working with channel partners can help TMs focus their time on specialized markets and named or strategic accounts while leveraging the channel partners to expand coverage.
 
Unfortunately, this melding of direct and indirect channels isn’t always a match made in heaven. “A multi-channel strategy looks great on paper, but it can be tough to execute,” says Rich Blakeman, Managing Director at Channel Enablers. “Channel partners and territory managers tend to have strong type-A personalities. Without proper planning, there is ample room for miscommunication and conflict.”
 
Eliminating these five common causes of channel conflict can go a long way toward restoring harmony in your organization.
 
#1 Incenting the wrong behaviors. Most sales professionals are “coin operated.” If the TMs incentive plans don’t give them a reason to work with channel partners, or worse yet, gives them a reason not to, they aren’t likely to welcome channel partners into their territory.
 
“Incentive plans are tough,” says Blakeman. “Naturally, you have to account for lower revenues due to partner margins, yet still make it attractive for the territory manager to work with channel partners when it makes sense. We spend a lot of time helping sales leaders with compensation planning. If they don’t get this part right, nothing else really matters.”
 
#2 Unclear rules. Having clear, written rules of engagement helps everyone understand the rules of the game. Knowing what ‘s expected of them and what’s expected from them in turn, can help channel partners develop a sense of trust in the vendor. Likewise, the TMs have a set of guidelines they can follow when conflicts inevitably arise.
 
#3 Unclear strategy. TMs need to know why they should work with channel partners. As we discussed in incentive planning, they want to know what’s in it for them, but they also want to understand the long-term strategy for the organization so they understand where they fit into the big picture.
 
#4 Poor territory planning. Just as the organization sets an overarching strategy for leveraging channels, each TM must map out their own strategy in the form of a territory plan. “This is not the time to be opportunistic,” says Geoff Wright, Senior Vice President at Channel Enablers. “Territory managers need to map out exactly what role channel partners will play. Which regions will they cover? What product lines will they be allowed to sell? How much revenue will they be responsible for?”
 
#5 Poor alignment. Some TMs are open to working with partners, but need help choosing the right ones. According to Wright, “The top volume partners will often be the first to ask for the opportunity to work with the territory manager. Territory managers may need to learn to ignore the noise and choose partners for more strategic reasons.”
 
If you’re experiencing cross-channel conflicts, see how many of these root causes exist in your organization. And be sure to let us know the results. Reach out to us at info@channelenablers.com or add your comments and questions below.
 
 
 
Last modified on 6/3/2014 9:28:11 AM
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