ChannelVision Sept-Oct 2017

channel management 9 Reasons CRMs Don’t Work for Indirect Sales W hen technology decisions arise, it’s reasonable to ask if existing solutions can handle the new task. In too many situations, however, this means trying to insert a round peg into a square hole. By Dave R. Taylor Take customer relationship man- agement (CRM), for example. It’s optimized for direct sales, yet decision- makers for companies with an indirect sales channel might look to CRM to serve as a partner portal instead of investing in a solution built from the ground up to meet the unique manage- ment requirements of the channel. One customer our team spoke with recently lamented that CRM can’t give you a deep dive into areas that are im- portant to the channel. “Channel chiefs don’t know which salespeople are ef- fective or which forecasts to believe. They are often blindsided at the end of the quarter, and then struggle to piece together data to understand why.” A CRM can’t effectively masquerade as a partner relationship management (PRM) platform for the indirect chan- nel. Consider these nine reasons why: 1. Architected for direct, not indi- rect, sales: CRMs are great for manag- ing relationships with direct customers, but architecturally they were never de- signed to manage the complex, multi- level relationships and touch points of the indirect sales channel. This makes managing partner relationships difficult and even convoluted without signifi- cant customizations. 2. No Standardization: Current CRM solutions that offer some PRM function- ality have to be customized to do what most PRM solutions are built to do. These solutions do not provide a pre-built, out-of- the-box solution with the desired function- ality channel managers really want with proven best practices. It’s like starting from scratch and learning best practices on your own, when those best practices are already built into a PRM and have been tested by numerous companies. 3. Slower Time to Market: CRM companies provide a “starter kit” of func- tionality with a consultant to do the inte- gration. These vendors follow this same model with their PRM solution as well, which can require months or even years of extensive (and expensive) internal resources and external consultants to modify the solution to fit their needs. 4. Higher Costs for the PRM Mod- ule: Some CRM vendors’ PRM options cost as much as 40 percent more than the initial CRM purchase. Combine that with the previous expenses associated with development and modification and you get an overall price that’s expo- nentially higher than simply implement- ing a pre-built SaaS solution. Also, most CRMs (including Sales- are charged per user. That works for a direct sales team or a single VAR with a few employees. However, it’s a nightmare for a global partner network with hundreds of part- ners and thousands of employees. That’s because a CRM requires every single user be configured with creden- tials and permissions, and most need to be trained as well. This makes the per-user licensing costs highly prohibi- tive, especially when coupled with the Channel Vision | September - October, 2017 68