Understanding Our Partners
A presentation on working with partners and Blue Coat
S. P. Dhar
Objectives Understand:
The different types of resellers Why there are different resellers What are the most common/successful resellers for Blue Coat Systems and why
How resellers differentiate themselves
How resellers are structured What motivates resellers Which resellers to use when
Getting the most out of our partners
Comprehensive understanding of your partners
Impacts on all aspects
Products / services to sell
Setting Goals
Channel Strategy Blue Coat Systems & Partner
Agreeing on Plan
Formal & Informal
Taking Actions
Blue Coat Systems & Partner
Getting Results
Blue Coat Systems
&
Partner
The 4Cs Need to address to ensure partners succeed
Capabilities
The right skills, attitudes, and knowledge in: sales, marketing, technical, finance, operations, and management how they relate to their overage targeted customers
Capabilities Capacity Commitment Coverage
Focus on the right: Customers Industries Solutions Run-rate vs project business Value proposition/ differentiation in those segments
Capacity
Sufficient amount of resources: especially finance Sales Marketing and technical
Commitment
Allocate resources Motivate resources Manage resources
The 4Cs
What the resellers need to provide
Coverage
Right customers and value proposition
Value proposition
Differentiation/ Strategic Control
Customer Base
End users
Products
Services
Sales
Capability
Right skills, knowledge, tools, resources
Capacity
Enough skills, knowledge, tools, resources
Commitment
Allocation, motivation, and management
Infrastructure
Types of resellers
Value add resellers
Networking resellers Systems integrators Security VARs
Telcos/service providers
Global Systems Integrators Product resellers Retailers ISVs (independent software vendors) Outsourcing Influencers
Consultants
Why are there so many different types?
Different
Products and services
Customers Infrastructures Differentiation Business models
Different product and services
Different combinations of products and services require different types of resellers
Transactional Homogeneous Upgrade/refresh
Project Management
Price Maintenance contract Installation Availability Price Ease of ordering
Complex Unique
Consulting
Large installation
Training
Business Application
Simple installation
Availability One stop shop Ease of ordering
Device
Staging Legacy integration
One stop shop
Product life cycles and types of buyers
Over the life of a technology, the types of buyers change
So do the resellers who will be successful
System Integrators
Value Added Resellers Multi Channels Low cost channels
Revenues
Tech Enthusiasts
Visionaries
Pragmatists
Conservatives
Skeptics
Partner business model
We need to understand the basic business model of our partners
Financial Model
16.74% 11.47% 2004 2003 Return on Working Capital 1.10% 2004 0.79% 2003 15.19 14.59 Operating Margin
2004 2003 Working Capital Turn 24.02 25.02 2004 2003 Working Capital Days
Value proposition
5.51% 5.41% 2004 2003
4.40% 4.62%
31.18 2004
30.92 2003
43.54
39.64 2003
50.70
45.54 2003
2004
2003
2004
2004
Gross Margin
Cost Structure
Inventory Days
DSO
DPO
Differentiation/ Strategic Control
Customer Base
Big Companies Enterprise Small and Medium Companies SMB (<499 employees)
Blue Coat Systems Product
Sales
Price
High High
Performance
Low
Consumer
Low
MARKETING GENERATE the leads and competitive positioning SALES MANAGEMENT MANAGE The organization CLOSE the sales MANAGE the customers
TECHNICAL IMPLEMENT and SUPPORT the sales
Infrastructure
OPERATIONS DELIVER/SUPPLY Products
FINANCE FINANCE the sales
sells, delivers, supports, collects, administers
Differentiation Price vs. performance
Differentiation ultimately drives a partners infrastructure and their requirements from Blue Coat Systems
High
Monopolists Usually occurs only if there is some type of monopoly (e.g. 1 partner in a territory) Generally to be avoided
Price
Value Partners Very strong technical services Customer intimacy
Performance High
Low
Traders Very price pointed Appeals to limited market if alternatives exist Walmart/CDW Strong transactional skills Generally in commodity products only Or in cross-subsidized
Low
Relative to competition
Infrastructure
It sells, deliver, supports, collects, and administers All of these processes are key, but Sales and Marketing are the most important Key is to understand capability, capacity, and commitment
MARKETING GENERATE the leads and competitive positioning SALES MANAGEMENT MANAGE The organization CLOSE the sales MANAGE the customers
TECHNICAL IMPLEMENT and SUPPORT the sales
OPERATIONS DELIVER/SUPPLY Products
FINANCE FINANCE the sales
How Resellers Sell
VARs
Prospecting Call/contact Salesperson
Product Resellers
Prospecting Call/contact Inbound/outbound salesperson Website
Qualifying
Outbound salesperson Outbound salesperson
Technical person
Qualifying
Inbound/outbound salesperson
Inbound/outbound salesperson Technical person Inbound/outbound salesperson Inbound/outbound salesperson Technical person Operations Vendor Wholesaler Technical/ vendor
Pre-sales design
Pre-sales design (generally little)
Proposing
Outbound salesperson Outbound salesperson Operations
Proposing
Close sale
Close sale
Deliver
Vendor Wholesaler
Deliver
Install
Technical/ vendor
Install
Support
Technical
Support (not frequent)
Technical
How Resellers are structured
Customers
Visits/calls
Awareness campaigns Visits Call to action (limited)
Visits with salesperson
Secure best price Organize shipping to end user
Reseller sales rep
Biz development/ product manager
Sales specialists/ sales engineer
Purchasing/buyer
Sales manager Marketing manager
Operations/technical manager
Purchasing manager (may not exist)
CEO
The sales square How resellers make sales happen The linkage between the different parts of the organisation are critical for success
Provides street information to product manager Sales forecast
Product and program awareness product knowledge
Sales
Provide technical info Assist in presales design
Pricing support Order admin
Marketing
Purchase requirements
Provides street information to product manager Sales forecast
Technical
Purchasing /buyer
CAM reseller focus
Customers
Visits/calls
Awareness campaigns Visits Call to action (limited)
Visits with salesperson
Secure best price Organize shipping to end user
Reseller sales rep
Biz development/ product manager
Sales specialists/ sales engineer
Purchasing/buyer
Sales manager Marketing manager
Operations/technical manager
Purchasing manager (may not exist)
CAM Focus The people who make/ influence sales most
CEO
The sales square How resellers make sales happen
The linkage between the different parts of the organisation are critical for success
Provides street information to product manager Sales forecast
Product and program awareness product knowledge Product manager puts pressure on purchasing to manage stock to maximize fill rates
Sales
Marketing
Purchase requirements
Provide technical info Assist in pre-sales design
Pricing support Order admin
Provides street information to product manager Sales forecast
Technical
Purchasing/ buyer
CAM distributor focus
Reseller
Visits/calls
Awareness campaigns Visits Call to action (limited)
Visits with salesperson (VAD)
Secure best price Manages stock levels
Distributor sales rep
Biz development/ product manager
Sales specialists/ sales engineer (VAD)
Purchasing/buyer
Sales manager
Marketing manager
Operations/technical manager
Purchasing manager
ChAM Focus The people who make/ influence sales most
CEO
What Motivates Partners?
Understanding what the channel needs
What Motivates Partners 3 types of people need to be motivated
all 3 need to be motivated & aligned to ensure sales
Blue Coat Systems Inc. Partner Sales Organisation
Sales Rep
Sales Manager
General Manager
So What Try to understand what motivates each type of person in the organization
What motivates a general manager/company
The value proposition the reasons why Partners sell Blue Coat Systems varies Partners often have numerous reasons Priorities vary by partner
Profit -Gross profit -Expenses
Direct Revenue $ Growth
Indirect revenue -traffic Ease of doing Relationship generator business/ -Emotional -bundled with selling -direction other products
Switching costs - sunk investment
Status/ credibility
Alignment of Risk future (trust/ objectives consistency)
High
Most frequent
Low
Very important when trying to convert
Usual degree of importance
So What Do not assume that each reseller is the same. Explore their requirements
What motivates a sales manager and sales person Compensation!
Commission is 25%-75% of total package
Usually based on achievement of:
revenue or gross profit targets
sometimes gross margin $/INR
May have to meet targets by vendor but often can shift sales between vendors
Being easy to sell AND win is critical
So What Try to find out how the sales manager and sales people view Blue Coat Systems contribution to his compensation
Motivating others Product/business manager
Usually substantial commission/profit base Similar to sales people
Technical people
Like vendors that have interesting products Prefer vendors that can offer good support resources
Summary
Topic The key drivers of partner success goals, plans, actions, and results require that ChAMs engage with their partners in a way which is relevant to the partner Partners come in many different forms, with great variety in the 5 elements of the business model Types Products/services sold Target customers So What In order to engage with your partner effectively and efficiently, you need to understand your partner.
Use the business model to understand the differences between your partners
Dont assume all partners behave the same
Business models
Differentiation What motivates them
