A Sales View of The Inside

by Michael Hickins

Salesforce.com offers companies a way to manage their partners as efficiently as they manage their sales force.

Knowing how your products are selling can be a lot like waiting for results on election night. Exit polls can indicate general trends, but you won't know exactly how many votes you got until all precincts have reported.

In a similar vein, companies can get an idea of sales trends from their in-house sales force, but don't really get the full picture until their indirect channels report sales.

Salesforce.com is about to offer a partner relationship management (PRM) solution meant to address this issue.

Partnerforce will provide vendors that have indirect sales forces with a centralized set of dashboards allowing executives to see sales from indirect channels on the same interface as sales from their in-house sales force.

This more holistic view of sales can help drive decisions on inventory levels and future orders to partners.

While the vendor gets a centralized dashboard that resembles a CRM solution, the channel partners see a portal, customized with the vendor's branding, where they can log on, register sales and get information they may need to improve their performance.

That performance has supply chain and sales implications for the vendor.

Elay Cohen, a product manager at Salesforce.com, said the channel partner's view of the portal is critical to adoption and, ultimately, the success of the product.

"The partner doesn't work for you, so you need to give them the right incentives to come back and register deals and provide customer data," he told internetnews.com. It's critical because that information rolls up into the forecast.

Denis Pombriant, managing principal at Stoughton, Mass.-based Beagle Research, agreed that this is a key feature of the product, noting that indirect channels are becoming more prevalent than direct sales in many sectors, including technology.

"If you're going to build product profitably, you've got to alert your supply chain to the data from the indirect channel, because the indirect channel knows where the deals are."

Pombriant told internetnews.com that PRM is one of the few remaining green fields available in the technology arena, and it holds great promise because of the potential for improving margins.

"Companies that want to drive down the cost of sales are looking to drive sales through the indirect channel," he said.

As with CRM, though, most small and medium sized businesses (SMBs) are underserved by current offerings, because they cannot afford on-premise PRM solutions from vendors such as SAP and Oracle (through Siebel).

Liz Herbert, an analyst with Forrester Research, said that on-demand PRM solutions will help SMBs, "increase visibility and improve their ability to forecast."

"Companies can use this strategically to plan their inventory, and get more information about up-sell and cross-sell opportunities," she told internetnews.com.

However, she expressed reservations about certain aspects of the initial version of the offering.

The portal seen by the channel partners does not show them information for all the other vendors with whom they work, and that makes the solution less attractive to them, she said. Another drawback is that vendors will have to get trained on how to set permissions for what information channel partners can and cannot see.

Typically, she said, people who administer on-demand products are not IT experts, and aren't necessarily well-versed in administering rules and access rights.

"They'll need to find a way to address this and make sure the right people are in charge of those decisions."

  This article was originally published on Monday Jun 26th 2006
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