BtoB: In setting up a sales channel partner network or troubleshooting one that needs help, where should businesses begin?
Stein: You need to write and adhere to a formal business plan. Partners need to be recruited, selected, trained, supported, nurtured, incentivized and kept on a revenue plan. Channel sales managers should consider partners' geographic coverage, size, proven expertise, resources, past sales successes, number of customers and financial condition. And consider what has worked for other companies in your industry. But this is just a start; I've seen misalignment of culture, for example, prevent a relationship from ever returning value to either party.
BtoB: Are there certain channel partner issues that pertain to small and midsize companies (SMBs) versus large enterprises?
Stein: SMBs have some challenges involving resources available to support the channel partner, and their own market presence. If I'm IBM, I've got buildings full of technical, marketing, product, sales, administrative and other support people to help my resellers. If I'm an SMB, my resellers may have a tough time because I may have little to no market presence and brand recognition. Further, SMBs generally have limited product scope, fewer active customers and resources, immature marketing and poorer sales processes. You need to understand these SMB-related shortcomings upfront and work to resolve them.
BtoB: How can a company balance its in-house sales force with a channel partnership program?
Stein: Carefully. Channel conflict is the single biggest obstacle to success for companies with both direct and sales channel teams. Clear guidelines on territory assignment, account size and account registration, among other details, must be understood by both. If there is competition between the two entities for the same accounts, there'll be trouble.