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How Motorola Optimizes Channel Data Management

Jul 09, 2014; By Ted Dimbero, Chief Marketer

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Channel data management (CDM) is a fast-growing discipline among large manufacturers that increases visibility into the fine details of what is happening within their sales and distribution channels. CDM is designed to deliver decision-grade channel intelligence that leads to increased sales and improved incentive program ROI.

With automated CDM, manufacturers can enhance their channel sales by responding to accurate, granular data from their channels, create better-targeted promotions, and develop more effective partner segmentation. They can also leverage a deeper understanding of customers to improve regional sales performance and new product planning.

In a 2013 report, “Market Overview: Channel Data Management,” Forrester Research wrote that “CDM solutions acquire point-of-sale (POS) and inventory data from B2B organizations’ partners (e.g., distributors, retailers, e-tailers, resellers) and transform it into high-quality insights to improve B2B organizations’ channel processes and programs. Once received from partners, this data is cleansed, standardized, and integrated into a B2B organization’s existing CRM/PRM/ERP system to provide channel professionals with visibility into every partner and end user transaction.”

One of the world’s leading telecom organizations has invested heavily in channel data management, and is realizing an excellent ROI. Within its go-to-market structure, Motorola manages a global channel program called “Partner Empower,” that enables channel partners and sales representative to know exactly how they are performing at any moment in time.

Among the top goals of this program, said Matthew Feetterer, Motorola’s senior manager for North America channel sales operations, is to improve the accuracy of how geographically dispersed channel sales results are credited to individual Motorola field sales reps.

“Greater accuracy in our sales credit reporting starts at the account manager level, and aggregates up to the territory and regional levels, across our product lines, vertical markets and end customer accounts,” he says. “The insights we gain from CDM reports allow us to change course as needed. Automated channel data reveals the places we need to make changes and take corrective actions to drive more sales and better position ourselves for the future.”

Sales incentives are critically important for every company that sells products through multi-step distribution. At the same time, this can be a complicated, time-consuming, error-prone process. Some salespeople spend an excessive amount of time building shadow systems to double check the accuracy of the company’s sales figures. They often feel this is the only way to ensure that nothing is falling through the cracks. When this happens, both salesforce morale and productivity can be negatively impacted.

“Proper sales credit assignment is literally the life blood of our channel sales organization,” Feetterer explained. “It’s critical in so many ways, especially from a credibility standpoint. We need to continuously improve the focus, trust, and effectiveness of our sales assets.”

To drive successful behavior within a salesforce, management must define specific strategic goals and attach those goals to individual compensation packages, Feetterer advises, so that sales people are motivated to focus their daily activities in the right directions. An essential management component is the ability to continually measure and update channel performance to close the loop on the entire process.

Motorola is a highly-matrixed organization, and this is done by design

“In some cases we create overlay teams, to deliver the best support to both our partner community and our end customers. As a result, we occasionally find ourselves crediting a number of people for a single transaction. From our viewpoint and our go-to-market strategy, this is done on purpose, but it illustrates why accurate reporting of channel sales results is a huge challenge for us.”

Another essential goal for Motorola has been to reduce the cycle time required to distribute updated sales reports to field sales reps and channel partners.

“It’s imperative to minimize the time needed to put sales information into the hands of the salesforce, so they have adequate time to analyze what has been shipped, what remains to be shipped, and what they need to do to close out the quarter,” Feetterer added.

Motorola’s key goals for channel data management included improving the accuracy of sales credit assignments, reducing the cycle time needed to deliver weekly reports, tighter alignment with business strategy for market development and improving the focus of the sales force.

“This is where the power and flexibility of a data measurement system plays a key role, because the current conditions in the market should drive strategy, and strategy dictates how an organization is structured,” says Feeterer. Channel data has no meaning if you can’t measure it accurately. You never want to compromise your go-to-market strategy due to system limitations, and you don’t want make manual interventions very often.”

Motorola’s channel data management systems automatically gather point of sale and inventory data from distributors, retailers, and resellers, and transform that into high-quality insights to improve channel processes and programs

Research has shown that smarter channel management has helped some companies in the telecom industry increase channel revenues by as much as 5% annually, and reduce sales promotion costs by 10 to 15%. Since incentive payments account for more than $50 billion of the $1 trillion in sales flowing through tech industry channels, these are substantial numbers that can dramatically impact a manufacturer’s year-end financial results.

Ted Dimbero is co-founder of Zyme Solutions.