Partner Relationship Management

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Partner Relationship Management

• Therese Cory
• Teresa Cottam
• Chorleywood Publications

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What is PRM?

• What is a partnership
• definition of partners people who get together
  to achieve a common purpose
• the deeper the alliance, the greater value-add
  the partners can generate between them - greater
  potential for profitability, new growth
  opportunities.
• partner to deliver product Together reach NEW
  markets neither could reach otherwise.
• Large companies becoming a collection of
  collaborators - collaborative enterprise..
  Customer focused - process centric, partner
  dependent. extending the boundaries of the
  enterprise.

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Types of partnership

• ranges from flirtation / short term relationship/
  ....marriage
• one project / loose reseller arrangement../
  value-add / joint venture ... permanent -
  acquisition/merger!
• Failure gets more costly.. Lucent-Alcatel merger
  did not materialise.
• Different types of partnership necessitate
  different strategies

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Comparison of depth of alliances
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When to partner - or do it yourself

• employee skills
• available assets
• superior processes
• cost
• differentiated offering
• protected niche..
• Partnering creates a larger virtual organisation,
  more advantageous to capturing market share.
  Business goals and information must be shared.
  Primary provider may reduce working capital, some
  of this carried by partners.

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Reducing strategic and business uncertainties

• How do the business objectives of the
  participants mesh with one another?
• Is there a size/power differential?
• Is the relationship a business-to-business or
  supplier-to-buyer one?
• Are the participants sharing a common business
  goal, or simply links in a supply chain?
• Are some partners likely to put their own
  immediate needs first?
• What information do participants need to
  understand their partners better?
• How will working with new partners assist /
  create new problems for participants?
• Could differences in work habits and culture
  endanger partner management?
• Does the contract provide for an exit strategy?

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Once the decision to partner is made...

• Decide what type of partnership is appropriate
• Select best approach - management and operations
• Identify skills needed
• Identify data needed
• Some solutions are people intensive, others
  depend heavily on IT

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The Roots of PRM

• Methodologies with business focus
• supply chain management, value stream creation
• Information management
• document management, CALS
• Software
• groupware, concurrent engineering
• ALL DEPEND ON
• data management, networking, storage

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People and Data

• Information in peoples heads or on bits of paper
• Estimated that 80 of a companys knowledge is
  not written down at all
• 16 is available on computers but is unstructured
  (e-mails, ppt presentations)
• 4 is in structured form, analysable, shareable
  (database, information systems)

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So what is PRM?

• A new market sector, promising huge revenue
  growth
• A management concept, good practice, business
  processes, all supported by IT
• Wide range of product types and solutions
• AT ITS MOST STRATEGIC, PRM IS A MISSION CRITICAL
  TOOL

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Management reducing operational uncertainties

• What functions must be performed by each partner?
• What information do they need and when?
• Are all processes understood, including human
  roles?
• Need mechanisms to
• measure criteria for success/ascertain
  performance
• remunerate partners

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Examples of product concepts

• Intranet/extranet with shared tools
• Extension of supply chain
• Extension of CRM
• Closed e-marketplace/private exchange
• Electronic bonding
• BUT..You cannot automate a partnership, only
  support it!

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Examples of commercial software products - ALLEGIS

• Shared extranet built around a database
• Range of shared applications and tools
• Role-based access permission/security
• Workflow and activity management
• OLAP reporting

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Tools to support function

• Finding and recruiting partners - risk
  management, profiling, on-line registration
• Motivating and managing - training and
  certification, joint business planning, market
  development funds, lead management
• Supporting joint sales and marketing - on-line
  product catalogues, targeted communications,
  searchable knowledge base, pricing
• Assessing performance and success - ROI,
  analytics, customer feedback, SLAs
• Accounting and remuneration tools

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Other product examples

• Supply chain extension - PeopleSoft
• CRM extension - Siebel
• Private exchange - Webridge
• People productivity and data management -
  Intraspect
• Electronic bonding - PartnerCommunity

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Critical success factors

• Usability!
• Language and currency support
• Links to legacy systems
• Supporting best practice, not enforcing new
  practices
• Lessons learned from failed data warehousing, CRM
  and other large projects

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CISCO Ecosystem

• Example of partner matrix
• Two tier reseller structure
• Developed in-house with aid of consultants
• In EMEA, 90 of products are sold through
  channel, 10 through direct salesforce
• Emphasis on increasing partner skills
• Partners have same tools as salesforce

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Telecoms industry - New imperatives

• New types of partnerships and partners
• Participants contrasted in business, culture,
  size
• New revenue sharing models, e.g.
• MVNO
• ordering bandwidth if you are an ISP
• ordering a local loop from the incumbent

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Example Bureau Service/Outsourcing

• Applies to billing, mediation, interconnect
• Alternative to software licensing
• Revenues more predictable for suppliers
• Enforces ongoing supplier/customer interaction
• Strict SLA criteria/risk sharing

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Example Peering between ISPs(example from
William Norton, Equinix)

• Decide on case for peering
• Identify counterpart
• Contact and qualification
• Discussion and negotiation
• Business case and Decision
• BUT..
• It could all fail because of personality clash!