On June 8, 2011 Infor announced its new Infor Partner Network (IPN), “a global network of people, systems and services designed to deliver the highest quality support for channel partners.” The goal? To achieve double digit growth over the next two years and double license revenue from its channel partners by 2013. Infor sees three basic elements of this program: channel expansion, partner growth and investment in the channel. Breaking it down a little differently, what is Infor doing to achieve its goals? The answer lies in:
- Clearer definition of roles and rules of engagement
- Investment in certification and training
- New and more products to sell
- Cloud based tools
Partner Landscape Today
Today Infor’s channel is comprised of about 700 active partners, as well as a little over 200 “not so active” partners in 77 countries around the world. Currently these partners produce about 25% of license revenue. Infor expects to recruit another 300 new partners while weeding out some of the debris that naturally collects in any channel. The intent is to better support those that are committed to Infor and its products and remove those which provide more distraction than sales.
Many of these partners focus exclusively on one product or a small slice of the full Infor product portfolio. One of the goals is to get more of them to sell a more complete suite of products.
Infor has involved its best partners in designing the new program and has responded to requests for better sales enablement, including training intended not only for onboarding of new partners, but also to get existing partners up to speed faster on new products. Partners are also looking to grow their own businesses and therefore requested a framework and tools to help market, sell and deliver more effectively in order to maximize revenue from Infor products.
Definition of roles and rules of engagement
While Infor has a significant channel today, the direct sales team has always been “king.” Potential channel conflict is always a concern in growing any partner network. Good segmentation and rules of engagement are necessary to minimize this conflict. For example, in North America Infor sees companies with annual revenues below $100 million as partner territory. Defining the segment is easy. Enforcing it is the hard part and therefore the application of those rules must have some teeth. Once defined, the direct sales force needs to stay out and the only way to make that happen is to not pay them a commission if they stray into partner territory. This sounds simple enough, but experience tells us that it is not a simple problem to solve and Infor will also have to introduce new standards for collaboration between the direct sales force and indirect channels.
In the past Infor has had multiple autonomous channel programs across products, loose market segmentation and product-centric channel coverage. It is headed towards having a professionally managed global channel program, well-defined channel-only sales zones and solution-centric channel coverage. More focused attention will be on investing in the highest performing partners.
A New Tier Structure
In defining IPN and in support of its focus on high-performing partners, Infor has introduced a tier structure that determines commission levels and other incentives. The tiered structure with three levels – associate, silver and gold – includes incentives based on quota and targets for net new customers. The program comes complete with accelerators, market development funds (MDF) and incentives to be exclusive to Infor.
New incentives for partners are crucial since without them, many current partners would simply go about business as usual. Some of these incentives are built into the tiered commission structure. But equally important are the new market development funds. The majority of channel partners for Infor, and indeed for many enterprise software companies, are small. Often they have grown out of small consultancies and many have little or no marketing savvy or budget. Activities that might be funded with MDF include telemarketing, the creation of sales tools and collateral, trade shows and events, direct marketing and more.
Market Development Funds (MDF)
Infor’s new MDF is more than funding though. It is a program. Think of it as an e-Trade account, or maybe something like a loyalty program like American Express Membership Miles. Partners accrue funds based on sales volume and tier. Once accrued, they formally request funds. Once approved, they execute their programs and then request reimbursement. The intent is then to measure the results through a debrief with Infor and lead tracking. This final step will be the most difficult to monitor and manage and bears close observation. Will it be worth the level of investment in channel management that will be required on Infor’s part? The answer will likely be yes, but unless the investment in MDF pays off with significant growth in channel sales, it will be difficult to justify.
Training and Certification
Infor has made a significant investment in its first ever partner training and certification program. Having hired an external firm expert in developing training curricula, this training program may indeed become the basis for all training for the company. The result: 70+ new training courses, partner certification across 10 products, 4 roles, and 3 competence levels (expert, preferred and certified). The training starts out online, making it a no-brainer for the partner investment. Then it moves on to classroom and/or virtual training. It is completed with certification that includes a mastery exam and observation.
In addition, many of the new product announcements recently made by Infor are for features that span across many of their product lines. These include announcements like Infor Workspace, ION (underlying technology), mobility, Business Intelligence (BI) and Performance Management (PM), and Software as a Service (SaaS). These enhancement options are covered in every course. While this could get somewhat repetitive for partners, repetition is key to learning and without complete understanding of these new features, partners will leave much of the value delivered by Infor on the table.
New and More Products to Sell
These recent announcements including Infor Workspace and ION, as well as mobility, embedded BI and performance management are all keys to Infor’s channel growth. The world is changing and enterprise software must keep up with the pace of both business and consumer technology change. Without this, installed base Enterprise Resource Planning (ERP), Customer Relationship Management (CRM), Supply Chain Management (SCM) and other applications that make up the Infor product portfolio will stagnate and ultimately be replaced with newer, flashier, better connected products. It is essential for the channel to be fully enabled with these new features and functions.
Cloud Based Tools
And finally, part of Infor’s channel strategy is to take a cloud based approach to channel management by implementing cloud based tools. These tools not only help Infor better manage the channel, but also streamline operations for the partners themselves. What are some of these tools?
- Contracts will move to the cloud. Expect to see the dissolution of existing contracts. The goal will be full self-service on pricing and approval.
- Partner Relationship Management to manage the MDF partner program
- Document Management with electronic signatures for secure and legal online document signing
Summary and Key Takeaways
In summary, Infor is aggressively building and transforming its channel focus through active recruitment of partners as well as better enablement of those partners. Mint Jutras believes this is a necessary step for significant growth. Over the past few years, Infor’s growth has largely been driven by acquisition and new sales of a select few of its product lines. With such a diverse and extensive portfolio of products that it has accumulated over the years, it is now time to set the bar for real organic growth of full suite solution sales. Even though the economic recovery has hit some bumps along the road, there is immense opportunity as companies look to catch up in technology. By backing its existing and future partners with product and sales investment, Infor can position both itself and its channel for long-term growth.
If you are interested in learning more, please visit http://www.infor.com/partners/channel.