Optimizing Service Outcomes with Channel Partners

by Apr 1, 2019

Technology vendors rely on partners to expand their geographic reach and extend access to the expertise necessary to enable the use of their products. While many vendors form channel relationships to sell products, more than two-thirds (69.7%) of technology vendors use channels to sell, deliver and renew support and maintenance services.

The Critical Role of Channel Partners

Technology vendors rely on partners to expand their geographic reach and extend access to the expertise necessary to enable the use of their products. While many vendors form channel relationships to sell products, more than two-thirds (69.7%) of technology vendors use channels to sell, deliver and renew support and maintenance services.

Vendors that have active channel programs rely heavily on their partners for critical service sales and delivery functions. The majority (84.4%) of partners that sell service contracts are involved with the delivery of these services and nearly three quarters (73.4%) are responsible for renewing contracts. The success or failure of channel partners to deliver services can has a profound effect on a vendor’s ability to achieve strategic service objectives and financial performance (contract renewal, customer retention and revenue expansion).

Technology vendors that rely on partners to perform critical service functions must have a well-defined and executed channel strategy. A successful channel strategy for services requires several elements: a clear vision for the role that partners will play, an established program and criteria for attracting and retaining the right partners, the commitment and capabilities to support partner success, and the means to monitor the effectiveness of the channel program and the performance of individual partners. This article outlines the steps necessary to optimize services through channel partners and introduces several research studies for channel management best practices.

Success is a Shared Responsibility

Technology vendors must view partners as extensions of their organization and recognize that channel success depends on the level of support they provide. The vendor must make it a priority to assure that a partner has the skills, tools, and resources necessary to perform agreed-upon service functions. Nonetheless, success is not the exclusive burden of the vendor — the partner must have a stake in the relationship. While vendors can transfer knowledge and provide access to tools, the partner must make necessary investments to achieve a mutually agreed-upon level of performance. Successful channel relationships depend on the commitment of both parties and their combined skills and resources to meet the needs of the marketplace.

Communication is Key

Vendor channel programs typically provide a flow of information to partners in the form of training and access to knowledge, collateral and even to designated contacts.

However, while partners value these resources, they do not take the place of an ongoing dialogue with the vendors with whom they do business. More than anything, channel partners indicate that they want more frequent and proactive communication with suppliers. They express a strong desire to be kept in the loop with new developments and to feel that they are plugged into the processes that vendors use to discover, create, and disseminate information vital to selling and delivering services.

Pay for Performance

Using channels to sell and deliver services must be a win-win proposition for all parties involved.  The vendor gains greater reach into new markets or extends its capacity to serve customers, while the partner earns an acceptable margin for the products and services it sells. The level of compensation partners receive must be commensurate with the level and quality of effort they bring to the relationship.

Success Starts with the Strategy

The term “partner” implies a symbiotic relationship where each party benefits from the efforts and actions of the other. A partnership also implies mutual expectations among those parties in the relationship. A channel strategy is therefore a formal declaration of how parties will work together to achieve a mutually agreeable outcome.

Channel Strategy

Working with partners can be both rewarding and challenging. Contact me to learn how ServiceXRG can help you optimize your service channel program to sell and deliver more services.

Chat with us (see link on right side of screen), send an e-mail to tsweeny@servicexrg.com, or use our contact form.

Featured : Service Channels Best Practices & Benchmarks

This report explores channel practices and performance to present strategies for improving the use and effectiveness of channel partners for the sale, renewal and delivery of support and maintenance services. This report explores perspectives of both technology vendors and channel partners, including value-added resellers, systems integrators, distributors, and retailers.

Login to get your copy.  Not a Member?  Learn more about our Service Success programs or contact us.

Login to Access Report

Please login to access this report. If you do not have an account, click on the button below to create a free membership*.

Questions?  Call 978.448.3166

Login

*Membership level determines your access to ServiceXRG research and other member services. Paid memberships include access to research and playbooks. Free memberships include access to some reports and discounts to others. Please visit our membership page for a list of available membership programs.

Related Articles

7 Keys to an Effective Service Channel Strategy

Technology vendors have long looked to channels to broaden their access to markets expand their geographic reach and enhance their skills and resources. This article introduces 7 keys to building and maintaining an Effective Service Channel Strategy.

read more

Service Channels Best Practices & Benchmarks

Technology vendors that rely on partners to perform critical service functions must have a well-defined and executed channel strategy to maximize service sales effectiveness and sustain customer loyalty. This article outlines the steps necessary to optimize services through channel partners and introduces several research studies for channel management best practices.

read more

Pin It on Pinterest

Share This