Quant Jocks vs. Process Poets: The Evolving Channel Operations Competency Model

John DeSarbo

Generating insight from sales channel data is critical to the go-to-market strategies of high-tech companies. Historically, they have struggled to gather data from hundreds or even thousands of channel partners, largely because of technological challenges. Today, these technical hurdles have been cleared, and high-tech companies have access to accurate channel data. The main challenge in gleaning insights from channel data is no longer an IT issue but a talent issue.

Channel Analytics

High-tech companies everywhere are scrambling to hire analysts with advanced mathematics skills—so-called data scientists—to find new growth opportunities for their businesses. Unfortunately, companies are struggling to locate personnel who can both crunch numbers and interpret the business implications of the results.

At a recent industry conference, one frustrated IT executive summed up the problem nicely: "Data scientists are like unicorns. Everyone knows what they look like, but no one has actually seen one."

And a recent Harvard Business Review article, "Data Scientist: The Sexiest Job of the 21st Century," showed just how integral the role has become to corporate America.

The companies with the best "channel data scientists" will have a distinct competitive advantage. However, this does not mean high-tech companies need to hire freshly minted math and science PhDs to replace channel sales and marketing managers. Instead, high-tech providers need to equip channel operations teams with new skills and capabilities, and expand their roles and responsibilities.

Elevating Channel Operations

Channel operations supports both channel sales and channel marketing by managing the processes and infrastructure that enable channel partners. Channel operations facilitates communication with partners, provides access to product information and tools, and measures channel performance and partner satisfaction. In this role, channel operations has borne the brunt of the channel data challenges that have plagued the technology industry in recent years. A study by the Aberdeen Group found that more than half of all organizations struggle to obtain channel data that provides even basic information on sales partners’ performance.1

Because they may be working with flawed data, many organizations have relegated channel operations to an administrative function. Instead of providing insights, channel operations is tasked with monitoring channel partner compliance with the company’s programs and policies. In a sense, the typical channel operations manager is less a "quant jock" than a "process poet," skilled at facilitating cumbersome manual processes to manage routine engagement with channel partners.

As outlined in the first article of this series ( /publications ) , recent advancements in data management and business intelligence have led to exciting channel analytics opportunities. Unfortunately, too often channel operations team members lack the skills, tools or both required to take advantage of these opportunities. When asked to analyze channel performance, often the best a channel operations team can do is provide basic reports with static metrics. Often, such teams are able to highlight only which partners performed above or below expectations last quarter, with little or no insight as to why.

Big Changes, Big Commitments

In order for channel operations teams to uncover how to improve channel performance, a story hidden in terabytes of data, their capabilities need to improve—and often, the improvements need to be dramatic. Channel operations teams need more than new tools; high-tech companies need to improve employees’ skills and recruit individuals with the analytical skills to fill in the gaps. These types of changes cannot occur overnight: In many cases, companies will need to engage third parties to support channel operations until the new capabilities are in place.

As channel operations develops sophisticated analytical capabilities, roles and responsibilities will shift. Rather than solely administer day-to-day channel management processes, channel operations can provide insights into how vendors can generate the greatest returns from indirect channel investment.

To make these fundamental shifts work, ZS Associates has found that organizations need to develop a formal competency model to help recruit, train and evaluate individuals for the position. Such a model provides a framework for organizing the skills and responsibilities that define a person’s work.

Five Essential Channel Operations Competency Areas

To empower channel operations managers to succeed, organizations need to outline their specific responsibilities and required capabilities. In defining the new competency model for channel operations, companies should focus on the following five essential areas:

1. Channel Strategy and Planning:

Channel operations must play a lead role in developing channel strategy and orchestrate the sales planning process. No longer merely a support function, channel operations should provide critical insights and inform go-to-market strategy.

2. Partner Program Design and Management:

Not only should channel operations administer partner programs, but they should proactively identify program elements that enable partners to generate incremental growth, drive partner satisfaction and loyalty, and maximize program impact and ROI.

3. Partner Identification and Recruitment:

Channel operations needs to conduct analytics, in order to identify the characteristics of high-performing partners, and assist channel sales and marketing by scoring potential channel partners based on firmographic information and identifying critical success factors in the recruitment process.

4. Lead and Opportunity Management:

More than just track registrations and leads, channel operations should determine optimal lead routing, propose cross- and up-sell opportunities to partners, and assess the impact of pricing and promotion on channel performance.

5. Performance Analysis and Insight:

Moving beyond a rearview window reporting model of partner performance, channel operations must be able to forecast channel revenue and profitability, based on partner opportunity pipelines, and identify priority channel performance drivers for the business.

Collaborative Analytics: Channel Operations as a Growth Engine

As channel operations teams develop greater analytical capabilities, they will deliver additional value to the organization. Advanced channel operations teams are concerned less with reporting past performance, and spend more time identifying growth opportunities and predicting what investments will drive channel performance. These teams focus on improving profitable revenue growth in the channel, delivering insights to executives, their channel sales and marketing counterparts and, perhaps most important, to channel partners.

About the Author

John DeSarbo

John DeSarbo leads the ZS Sales Channel Strategy & Management Practice, and has more than two decades of consulting and industry experience focused on sales and marketing strategy and operations. His areas of expertise include multi-channel go-to-market strategy, channel analytics, alliance and partner programs, and sales force design. John works with clients across a variety of B2B industry sectors with a particular focus on the technology industry.

This is the second of three articles examining channel analytics in the high-tech industry. In the next installment, we'll share examples of how industry leaders are using analytics to improve collaboration with channel partners and accelerate profitable revenue growth.

1. Peter Ostrow, “The Extended Sales Enterprise: Channeling Better Results,” Aberdeen Group report (2011).