The news as of the first coffee this morning, and the music is Commander Cody and the Lost Planet Airmen's "Truck Stop At The End Of The World:"
Way back in the late '90s -- 1990s -- when First Coffee started working in the CRM field (eye roll, "Here goes Gramps again, fetch his ear trumpet,") I worked with Bob Thompson of CRMGuru.com fame. At the time Bob was trying to get something called "Partner Relationship Management" off the ground, the idea of treating channel partners as customers. "He wants to own the buzzword," a mutual associate said to me at the time.
Not a bad ambition. I've seen worse. I've had worse. I've accomplished worse.
It didn't really catch fire then. In March 2005 I looked at PRM again for TMC, and found that it still hadn't. "For the majority of manufacturers, PRM rarely fulfilled its promise of being able to synchronize product introductions, train workers and foster teamwork among resellers," CRM Daily wrote at the time. Instead, the PRM platform became a foundation for managing, publishing and controlling pricing throughout channels.
At the time Siebel still had their PRM stuff for sale -- heck, at the time there still was a Siebel. Here's how it was described:
"Siebel Partner Relationship Management provides companies with an enterprise-wide platform for managing relationships with partners and resellers. Using Siebel PRM, companies can plan and execute collaborative sales, marketing, and service programs; enhance forecasting accuracy and pipeline visibility; reduce partner management costs; and improve their ability to orchestrate channel operations on a global basis. Moreover, Siebel PRM provides native support for industry-specific PRM best practices, leading to greater partner program effectiveness and increased end customer and partner satisfaction."
As I wrote at the time, reading that seemed as nostalgic as reading old plot lines from Happy Days. Basically PRM's a great idea, automating the most common tasks involving channel partners, manufacturers and distributors. It grew like San Francisco Giants sluggers on steroids during the dot-com bubble, and collapsed about as fast.
It didn't go into a coma because the idea was bad. Much of it simply wasn't worth the keep. One vice president of sales recalls his dilemma with PRM: "I could [either] use Fed Ex tubes and have an admin crank out labels, or implement an entirely new system just for that. Fed Ex won."
Last October Bob told me " I think PRM got lost in the downturn and never really came back. That said, channel-centric companies understand that while they have to 'manage' partner relationships a bit differently, the same principles apply. The main difference is that business partner's view of value is generally revenue or profit."
The problem, I noted back in March 2005, is that what PRM was supposed to do, companies can do using low-cost items like Microsoft SharePoint, low-cost portals, freeware for project collaboration, salesforce.com, Siebel-IBM OnDemand initiatives and other hosted alternatives. Plus it just kind of… smelled like something somebody was creating to get you to buy their stuff. Remember PartnerWave?
Then lo and behold, earlier this week salesforce.com announces Partnerforce, Salesforce Partner Edition, described by company officials as "a new on-demand offering from salesforce.com that connects enterprises, channels and partners through the power of the AppExchange and The Business Web."
Salesforce Partner Edition "now allows companies to deliver all the benefits of salesforce.com's industry leading Salesforce CRM and marketing services to any partner." PRM, by a bit of a back door, but still.
Salesforce Partner Edition is described as a tool that lets vendors "distribute sales and marketing information quickly and efficiently across a multi-tiered distribution channel through a customized, on-demand portal that is as easy-to-use as a website."
The idea, evidently, is that this helps ensure high partner adoption as it provides sales managers with an accurate, integrated view into their entire sales pipeline. Using the salesforce.com product, integrated dashboards can display forecasts and pipeline views across both the direct and indirect sales organizations, while an integrated lead management system proactively ensures that lead distribution is aligned across both internal sales as well as channel partners.
PRM's even getting some love from the analysts. "The ability for companies to be able to analyze their sales and marketing pipelines and programs across both direct and indirect channels is a critical component to any successful growth effort," said Tiffani Bova, research director at Gartner. "An integrated view delivers productivity and increased effectiveness to both sides of the sales model, ultimately driving revenue and profitability for both vendor and partner."
So is PRM the Next Big Thing (again)? That cliché of an overnight success after nine years of hard work? Bob can get out of that parvenu Burlingame and move his family onto the Big Island?
Not so fast, thinks industry observer David Bradshaw. "Yesterday, salesforce.com announced that it would be offering a partner relationship management (PRM) software extension to its CRM software-as-a-service," Bradshaw wrote recently. "The new product extends the functionality of salesforce.com to channel partners. The product enables product or service-producing companies (or 'brand owners') to let their partners deal with them using a dedicated version of salesforce.com."
As Bradshaw notes salesforce.com already has partners using it, including its currently largest customer Cisco, which is running a pilot program in EMEA.
And it's not PRM itself Bradshaw has a problem with, understand. He calls it a "very important area," noting the same dynamic Bob noticed years ago: Only around one-third of goods and services are sold directly, meaning that two-thirds of the market for CRM is up for grabs via PRM offerings.
Nevertheless Bradshaw sees "three key problems over the adoption of PRM systems."
One: Channel partners "often work with multiple 'brand owners', so see no reason for using one brand owner's system." Refer back to the FedEx observation earlier.
Two: Many partners are "fiercely defensive about their ownership of the customer relationships and don't want to make it easier for the brand owners to usurp that ownership." Self-explanatory.
And third, "there are the usual issues over adoption of the system, which have increased because the end users are someone else's employees, not employees of the brand owner." In other words, unless it's Wal-Mart requiring you the supplier to use certain RFID products, which they can because they're Wal-Mart and you're… not, why should I install this stuff or use these hasselous processes just because it makes your life easier?
The advent of hosted software, not much of an industry presence back in the days when Bob 'n' Dave were tearing up the CRM world, ASP was as close as it got, goes a long way to addressing these three issues which didn't originate with Bradshaw nor suddenly become problems this year. They've been around for a while.
Salesforce.com's betting that its hosted model overcomes a lot of the resistance to PRM, mainly by not requiring costly installs, and that might have legs, but as Bradshaw notes, salesforce.com "will have a much tougher job with external users of PRM. What will really make a difference is if the brand owners offer sufficient incentive for their channel partners to adopt the PRM systems, and that is beyond salesforce.com's control."
Look, PRM's a good idea, but it's not an idea to build an industry around. "I don't know if specialized PRM vendors will be around much longer," Lawrence Lindsey, vice president of engineering for BPA software vendor Nsite told Marshall Lager last year. And Forrester analyst Liz Herbert told Lager "The most notable part of this trend is that it's largely the hosted-CRM vendors who are announcing partner and channel management additions."
So basically, if you can do PRM with CRM or e-commerce stuff, you should. No new billion-dollar buzzword, though. Don't we have enough of those already?
If read off-site hit http://blog.tmcnet.com/telecom-crm/ for the fully-linked version. First CoffeeSM accepts no sponsored content.