Channel Call

For Microsoft Partners, the Focus Is Performance

It's one thing to be productive, but if your productivity comes at a high cost, you lose. Therefore, it's important to be efficient, too.

Last month I started discussing metrics and the importance of measuring your channel. Specifically, I narrowed the focus to a few sales and marketing key performance indicators (KPIs) outside of the norm. This month, I'll look at a few more specialized KPIs.

Expanded Categories
While the bulk of the KPIs my team has developed fall into the sales and marketing bucket, our team expanded into other categories for measurement. For instance, we took a look at KPIs within the productivity, efficiency and enablement categories as they relate to the channel.

These areas may sound familiar to you, because earlier this year I wrote a series of columns on the optimal "gears" within a channel. Well, this is a way to measure those gears.

Productivity
Some productivity KPIs already exist within the sales category, but you need to get very granular and break some KPIs out into different categories. For instance, one of the KPIs within productivity is Average Revenue Per Reseller. Wait, isn't that a sales indicator?

It is and it isn't. This really is an indicator of productivity. If your average revenue steadily grows month over month, then you know that there exists systems and processes in place to produce consistent and predictable revenue.

The same goes for Average Growth Per Reseller. If growth rates maintain a positive trend, then you know production is OK. The reverse holds true, too. If growth rates plateau or decline, something in the production chain must be fixed.

With Average Sales Per Reseller Per Month, we naturally think "sales indicator." Look at this from a trending perspective, however, and you start to shift your thoughts to productivity.

Efficiency
It's one thing to be productive, but if your productivity comes at a high cost, you lose -- therefore it's important to also be efficient.

For instance, take a look at your Revenue to Expense Ratio on Channel Deals. That is, create a KPI specific to this and start tracking it. What will happen is that you'll start to really pay attention to the expenses on each deal, making your team become as efficient as possible in the process.

Enablement
Number of Resellers Enabled on Non-Performing Products vs. Total Number of Resellers Enabled. It's a long KPI name for a really interesting metric.

This ties directly into sales and will help the vendor determine good cross-selling and up-selling opportunities. If a product is not selling as much as it should and the number of resellers enabled on that product is low, it's a fairly simple correlation.

However, you'd be amazed at how many vendors simply don't track this information.

Number of Deals by Solution Selling Reps vs. Non-Solution Selling Reps. This KPI goes right to the core of training and will help you draw a correlation to the training needs of your sales team. Also, it lets you easily justify investing in training if the numbers warrant the investment.

Performance
The entire reason for developing KPIs exists with the middle word of that phrase: performance. The three categories listed here -- productivity, efficiency and enablement -- are critical gears in increasing the performance of your company.

Track these areas well, derive meaningful insight and watch your company thrive.

Next Time: The Last Mile for Metrics

About the Author

Keith Lubner is managing partner of Channel Consulting Corp., a N.J.-based global consulting organization focused on channel strategy, design, enablement, outsourcing and training for growing companies.