Vendors Need to Prequalify Partners

No company would hire an employee without first checking credentials, background, and capabilities, yet so many vendors allow just any solution provider to join their channel program.

By Larry Walsh

Last week a vendor, which I won’t name here, announced a new, enhanced partner compensation model. The company promised partners service margins up to three times those offered by competitors. It’s a generous proposition, indeed, so I looked for the particulars.

Sure enough, the announcement of the margin enhancement appeared on the vendor’s partner page. But no details were available. Getting the skinny required registering to become a partner.

So I did.

And I told the truth. I didn’t give a fake name or dead-drop e-mail address. On the application, I told them who I was and what my company does. I provided the requisite firmographics, including revenue, number of employees, and customers serviced.

After going through the application process, I didn’t receive any details about the margin enhancements, as promised. Instead, I got a notification that the vendor’s team would review my application and, if my company qualified, I would receive notice within 48 hours.

I expected nothing more than a rejection e-mail. After all, why would any vendor want The 2112 Group as a reseller or solution provider partner?

To my surprise, I received an e-mail just 14 hours later saying 2112 had been approved for participation in the program. Moreover, the approval notice included account credentials and instructions for logging in to the vendor’s partner portal.

I now have free rein to wander about the vendor’s portal to collect information on products, programs, pricing, support resources, compensation, and incentives.

That shouldn’t happen.

I must confess: I’ve done this many times over the years, and rarely have I been declined.

This time, a large security vendor accepted me into its partner program and actively tried to cultivate me. I knew the channel account manager turnover rate because I would get a call or e-mail every four months. The new person would introduce himself or herself and look to set up a meeting to discuss sales plans.

Getting out of a channel program isn’t easy. It took a major PC vendor years to purge me from its partner rolls. On my annual visit to its headquarters, I would tell channel managers that I was still getting mailers and partner notifications, and still had complete access to the partner portal. Each time, they swore they had removed me from the system.

To this day, I still receive partner-directed notices from several vendors announcing development road maps, pricing changes, program adjustments, and special messages from new channel leaders.

I share these stories to show that my experience over the years runs contrary to something channel chiefs say frequently: “We want the right partners.”

The implication is that vendors are discriminating recruiters. In reality, few actually are.

‘Fog a Mirror’ Recruitment

In our newest 2112 Channel Chief Outlook report (coming later this month), we’ll reveal that the majority of vendors say they plan to recruit more partners into their programs to expand sales capacity, augment customer support resources, and address the specific needs of vertical segments.

What vendors want the most are partners that have the capabilities and capacities to adopt, support, and actively sell their products and services. Not every partner can or is willing to do that. The overwhelming majority of channel partners, in fact, are opportunistic and transactional. If they have technical skills, they don’t have sales chops. If they have sales acumen, they may not have stellar tech skills. Some have skills in both areas, but no appetite for growth. And many have some tech skills and sales resources, but are poorly organized and perform inconsistently.

Those statements come across as harsh, I know, but they reflect reality, and they’re the reason why vendors say they want the right partners. No one wants to waste time on partners that won’t add value or contribute to the achievement of goals.

The challenge many vendors face in their recruitment efforts is metrics. A big performance measure for channel programs is the number of partners recruited. If the filters are too stringent, it takes more effort and time to attract and onboard a critical mass of new partners. Hence, vendors – like the one whose partner program I just joined – will bring anyone who can fog a mirror into their programs and let the natural forces of attrition separate the haves and have-nots.

This recruitment-to-washout approach doesn’t always work well. A vendor that 2112 helped build its channel program rejected our guidance when we prescribed raising the bar on partner recruitment. Not only was this vendor dealing with sophisticated technology, but its model required partners to have tremendous hands-on involvement in customer engagements. Rich margins drew partners to join the program, but the progarm failed because partners couldn’t perform the advanced tasks required of them.

Pre-Qualify Partners Before Onboarding

Most vendors understand that new partners need a formal onboarding process. Partners are like new employees. You have to walk them through the paperwork, show them around the office, introduce them to the right people to get things done, and – of course – train them how to do their jobs.

Where vendors often fall short is qualifying partners before onboarding them. Many vendors will do light segregation for their programs, such as targeting only vertical, integration, or service specialists for different go-to-market strategies and programs. Some might put partners in different buckets based on their function, role, and value.

But vendors need more than just vague ideas of the types of partners they need and want in their programs. They need to look at partner capabilities (raw skills), competencies (specific areas of expertise), and capacity to sell and support products, and to grow over time. Qualifying partners before they enter a program will make it easier to discern between acceptable and unacceptable applicants.

Qualifying partners isn’t a one-sided process. Vendors should give partners feedback on why they’re accepted into a program, accepted with conditions, or rejected. In some cases, partners may not have the prerequisites a vendor seeks at a given time, but they will have the foundational skills and ambition to grow into a potentially strong partner down the line.

Again, no company would hire an employee – particularly one that’s crucial to revenue generation and market viability – without first establishing qualifiers, going through an evaluation process, and providing feedback. So why do vendors do that with partners?

Yes, a prequalification process will add time and effort to the recruitment cycle, but the result will be more focused, more productive channel programs and partners.

2112 helps vendors with recruitment through channel program development, partner profiling, and partner assessment tools. For more information on how 2112 can help with your partner identification and qualification process, e-mail info@the2112group.com.

Larry Walsh is the CEO of The 2112 Group, a business strategy and research firm servicing the IT channel community. He’s also the publisher of Channelnomics, the leading source of channel news and trend analysis. Follow Larry on Twitter at @lmwalsh2112 and subscribe to his podcast, Pod2112, on iTunes, Google Play, and other leading podcast sources. You can always e-mail Larry directly at lmwalsh@the2112group.com.