Evolving Partner Performance Metrics

As part of VARBusiness' Channel 2.0 project, a year-long effort to map the channel through the next five years and beyond, I spoke with several channel chiefs at last week's XChange Solution Provider conference in San Diego about their views on evolving partner metrics. Many are beginning to look beyond the traditional revenue-based metrics for evaluating partner performance, which could level the playing field between large and small solution providers.

Robert Deshaies, vice president of Microsoft's U.S. partner program, let it slip at XChange that Microsoft will be taking the wraps off an influencer program, in which solution providers can earn cash and points for recommending a product sale or contributing to expanding a deal even if they weren't the ones to fulfill the order. The goal is to increase the level of cooperation and "co-optitition" between Microsoft, large account resellers, systems integrators and smaller solution providers.

"We're adding new dimensions [to partner performance]," Deshaies said in an interview with VARBusiness. "It's not just about direct revenue, but breaking into other performance metrics; to be more objective than subjective."

At CA, the recovering software vendor is expanding its requirements for formal business planning between its largest solution providers and channel team. Bill Lipson, CA's senior vice president of worldwide channels, told VARBusiness that about 150 solution providers would now have quarterly business planning views with their channel managers to measure performance and make strategic adjustments.

Through these reviews, Lipson said CA will identify opportunities and fix problems. Conversely, the reviews may also lead to severing relationships if they determine that the relationship is fundamentally not working.

"It's not an elaborate document, but it's enough to force them into thinking about the business and also makes them look at how we conduct business," Lipson told VARBusiness.

And Cisco Systems is look at providing more back-office operations training and support for its solution providers. Rather than look at quarterly performance, the networking giant is assessing partner capacity in areas like cash-flow, human resources and market capacity.

"We have to scale our approach to the channel and help our channel partners scale their businesses," says Chuck Robins, segment vice president of U.S. and Canada channels. "If we are to grow at this pace, we need to scale across the technology and the sheer volume between now and then, and help our partners with capabilities and capacity to achieve these growth rates."

Solution providers attending XChange, by and large, welcome enhanced performance metrics that took into account capacity, capability, certifications, market specialization and growth rate. Since most vendor channel programs provide benefits -- tier ratings, discounts, rebates, etc. -- based on revenue, enhancing performance metrics could level the playing field.

However, as one solution provider said, revenue measurements shouldn't be abandoned. After all, he said he won't reward his sales people for doing a good job if they don't produce numbers.

What are your thoughts on vendors' metrics for evaluating partner performance? By what measures do you think vendors' should base their rewards? Send your thoughts to me at [email protected].