Two recent events and a client engagement have me thinking a lot about PRM solutions and the challenge that technology vendors have in developing portals for their partners. Historically, PRM solutions have been about partner program automation - delivering an interface to help automate the management of partner contracts, levels and program benefits. Increasingly, PRM solutions are about partner opportunity management - managing lead distribution, deal registration and such. Many of the early PRM vendors, at least the ones that haven't gone out of business, struggle with this shift in focus. A couple, like BlueRoads, do this very well, but still, a major challenge remains for all of them and the vendor communities.

One of the truisms of PRM is that, unlike every other category of software in the market, it has it's features designed by and paid for by folks who don't actually use it. Vendors fund the software purchase and define it's features, but partners log into it to track support tickets, track leads and manage deal registration. This higher degree of interaction drives more value for vendor and partner alike, but at a much higher administrative burden. But first, a history of PRM, a review of the present and then, what the future holds.

The first generation of PRM solutions were focused on automating partner program membership and the benefits of being a partner - things like contract renewals, support incidents, MDF report and the like were automated into a self-service portal. This reduced the administrative burden at the vendors side and enabled partners to work after hours on vendor relations tasks, which maximized sales time. The challenge that early vendors had was that this system wasn't enough of a value often to cross the build/buy decision and, as such, renewals of initial sales were hard to come buy.

The second generation of PRM solutions added to the partner management functions of the first generation and brought partner opportunity management to the table, automating the distribution and reporting on leads, administering deal registration programs and thinking of the partner interaction based on opportunities instead of contracts. This is a huge leap forward in value, as it not only gives the vendors better visibility into the partner's activities, but it also ties the sales process of the vendor into the sales process of the partner. These second generation systems allow marketing materials and resources relevant to the product and sales stage to be at the partners fingertips as they update their opportunities in the system. Unfortunately, this very advantage is also it's biggest challenge - for a deal with 4-5 vendors in it, a partner rep is constantly having to log into different vendors websites to update the deal status. This is a huge adminstrative task and as such, often doesn't happen.

Recently, I was invited to speak at the ConnectWise event in Tampa. Arnie Bellini, the CEO of ConnectWise, as built a great product for VARs to manage their business - it combines service ticketing, customer service contracts and sales management into a VAR-centric CRM system. They are growing leaps and bounds and, not surprisingly, their customer growth is coming from the top 20% of VARs that represent 80% of the vendor revenue. In short, the best VARs out their are automating their own business with a CRM solution built for VARs by a VAR. Whether using ConnectWise or other vendor products, like Microsoft CRM or Goldmine or Salesforce, the top VARs are automating.

Which raises a dilemma - if they are asking their sales people to enter sales activities into the VARs CRM system, how much time is left over for the partner sales team to update vendor sites?

The third generation of PRM solutions will be a dramatic shift in how we think of PRM. PRM solutions will become less of an application and more of a system of workflow, authentication and validation to link CRM systems at the vendor with CRM systems at the partner. This mesh automation will require the industry to work on developing a standard data model for what a lead is, what an opportunity is, etc., but XML makes creating these document standards for interchange a lot easier and flexible to meet the specific requirements of diverse vendors.

In the next generation of PRM, partners will get leads distributed to them or pulled by their own CRM systems, populating their lead queues on their own CRM system. As these leads are developed or closed as no-opportunity, the CRM system of the partner will update the vendor systems, creating a real-time data flow between partner and vendor.

Consider a use case: Let's say VMware has a lead for a customer who is interested in moving their applications and data center to a virtualized solution. A partner gets this lead and, after qualifying the customer, decides there is a real opportunity here and converts the lead to an opportunity in his CRM system. In doing so, he also selects the other vendors that will be part of the solution - VMware, of couse, but RSA for secure tokens, IBM for servers and Acronis for backup solutions. In his CRM system, he creates the opportunity and adds these vendors to the opportunity. In doing so, the CRM system at the partner pulls the XML template for each vendor that contains the incremental information needed by their deal registration system. All of the vendors use the standard data model for the opportunity - who the prospect is, what business need is driving the purchase, whether it's been budgeted, contact info for the partner rep, etc. What comes down in the XML templates is the incremental information - for RSA, for example, questions about who the security lead on the project is, or questions about their existing server infrastructure for IBM.

Now, given all these vendors now have visibility into the same contact information, as the partner updates the opportunity stages, the vendors are automatically notified. Additionally, as the partner proposes the solutions, the customer visits the vendor's websites to get more information on the product set, generating leads. The PRM solutions at these vendors recognize that the lead isn't a new prospect, but a current opportunity and pass these leads to the partner, where they appear in his CRM system as activities associated with the opportunity. This allows the partner rep to track what the prospect is doing and to tailor his sales plan accordingly.

As the deal progresses to a close, the partner can use vendor configurators, integrated into the CRM interface, to build the final proposal to the customer and, leveraging the distributors web services interface, get pricing on the solution and generate quotes at the distributors, locking in his price. As the deal closes, the partner updates his CRM system, which notifies the vendor that the deal has closed and is pending at distribution.

For this to happen well, it's going to take a cross-industry effort to define the web services interfaces, the data objects for a lead, opportunity and support incidents and to work out how we want to authenticate and protect customer data in a web services world. I've already started the dialog with a group of PRM and CRM vendors, but welcome more. If you are interested, drop me a line. In our interviews with partners, this is the single biggest step vendors can take to accelerate their business automation and it represents an opportunity for real competitive advantage for those that take the first steps.

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