The Greek philosopher Heraclitus said, “The only thing that is constant is change.” Clearly, Heraclitus was a channel chief.

While the average tenure for CEOs and CFOs has reached 9.7 years and 5.9 years, respectively, it seems like the average tenure for channel chiefs can be measured with a stopwatch. In fact, the channel chief revolving door has never been more active; in just the past few months, IBM, Cisco, Lenovo, NetApp, Palo Alto Networks, and Juniper Networks have all replaced their channel chiefs.

What’s causing the turmoil? After all, manufacturers are increasingly dependent on their indirect channels to cost effectively reach new markets and serve fragmenting demand.

Our own primary research and conversations with channel executives across many manufacturing segments have identified four key challenges that channel chiefs are struggling to overcome:

1. Increasing partner engagement. It’s true that partners choose vendors based on the quality and competitiveness of their offerings. However, the second most common factor is the ease of doing business with them. This involves everything from onboarding, to certifications, deal registration, program utilization, claims submittal and payment, and more. Most manufacturers have dramatically increased the breadth and complexity of their offerings while utilizing the same processes and tools from decades ago. As a result, partners often spend more time dealing with paperwork and administrative issues and less time marketing and selling.

2. Reducing the total cost of sale. Every manufacturer wants indirect channels that scale. The ideal partner mix is one in which the majority of partners are serviced in a cost-effective, scalable model, and only a handful of partners require focus. Unfortunately, this is often not the case. Channel chiefs often deal with partner issues surrounding confusion over programs, eligibility, endless special pricing requests, escalations regarding rebate claims, and payment delays. As a result, their dream of a scalable, high-performance channel turns into a high-touch sales model, making channel funding and resources vulnerable to cost-cutting or reorganization initiatives.

3. Insight into channel performance. Had Samuel Taylor Coleridge been a channel chief, he would have written, “data, data everywhere and not an insight to share” instead of “The Rime of the Ancient Mariner.” Exploding product portfolios, multiple incentive programs, tiered partner programs, and terabytes of distributor and POS data create an information-overload problem for even the most advanced manufacturers. Channel chiefs struggle to translate these volumes of data into insight and answer key questions, including:

  • Which incentive programs are delivering the best results?
  • What are the high-performing partners doing that lesser-performing partners are not?
  • How does program utilization vary across regions, partners, and programs?
  • How can I transform my “B” partners into “A” partners?

Without the right analytics – powered by accurate, timely data – key decisions regarding channel budgets and program expenditures are left to subjective discussions which often end poorly for the Channel Chief.

4. Driving revenue growth. Accenture’s 2014 report, “Improving the ROI of Indirect Channel Incentives,” concludes that the money manufacturers spend on partner incentives is not delivering an appropriate return. Clearly, the days of a one-size-fits-all incentive or program model are long gone. Instead, manufacturers need to rapidly create new, targeted incentives to encourage the pursuit of new market opportunities. Additionally, they need to mix and match incentive levers, such as rebates, discounts, bundles, MDFs, and SPIFs, to create compelling, differentiated campaigns that drive greater revenue and create sustained product and brand preference.

Individually, these challenges represent major obstacles to channel success. Combined, they can stall the career of even the most driven, gifted channel chief. What’s a channel executive to do?

endangered species imageThe answer lies in holistically managing the channel and all its partner, program, and product lifecycles. To make this a reality, channel chiefs need to partner with the CFOs and business unit executives to invest in an integrated channel management platform that provides a consolidated view of partner, product, and program performance and ensures the accuracy of all channel-related transactions. This platform provides the missing link between CRM and ERP systems and delivers to channel chiefs the insight necessary to overcome their four daunting challenges.

Channel chiefs don’t have to follow the path of the West African Black Rhinoceros into extinction. Instead they can use a comprehensive, integrated channel management platform to harness the power of changing product portfolios, channel programs, market opportunities, and incentives models to drive profitable revenue growth and maintain a long, prosperous career.

This post was originally published on LinkedIn.