Guest Blogger

In the wonderful world of data management, there is one thing you can be sure of… if you don’t establish and maintain data collection best practices, your customer insights will be out of date within days.  Nick Andrews, General Manager for EMEA and India at Zyme explains what needs to be improved behind the scenes.

Establishing best practices and agreeing a common reporting vocabulary not only increases data accuracy, but it can also aid operational efficiencies.  Yet, according to research, many consumer electronics organisations would say there is in fact an urgent need for system improvements.  For example, despite ongoing pressure from stakeholders to reduce operating costs, just one in five (19%) companies interviewed were ‘very confident’ that they have a 360-degree view on inventory at all times.  More than half described themselves as ‘not particularly’ or ‘not at all’ confident in this area.

The report, entitled ‘Channel Data Management Barometer 2017’, collated responses from 166 individuals with responsibility for / visibility of the management of data collected through the channel, and it is here that a number of issues were uncovered.  There were some suggestions that part of the problem is a lack of consultancy across all the parties involved from manufacture to point of sale, for example.  The potential solution, when creating and designing incentive programmes, is to make sure you have to secured buy-in from those expected to report sales against the campaigns from the outset.  Ensuring partner satisfaction in these early phases will contribute greatly to achieving targets each quarter as well as playing a critical role in ongoing performance reviews.

The statistics also highlighted that the lack of data management in this area of the business is having far-reaching business implications.  A staggering 80% of those interviewed think they have lost commercial opportunities because of limitations in their ability to collect and analyse channel data.  42% also admitted that inventory tolerance alert levels were based on inaccurate data.  Of equal concern is that 43% said they have shared data with the board in which they are not completely confident.

Going forward, companies still expect sales opportunities to open up via channel partners, yet fundamental supply and demand issues aren’t yet being correctly managed.  This problem will only be further compounded as partner networks grow; and the channel is becoming ever more important.  From a commercial standpoint, three-quarters (74%) of those asked see indirect sales as a proportion of their total sales increasing over the next two years.  With just over half of current sales coming via the channel on average, channel sales look set to become more significant than direct sales for businesses as we approach 2020. Enabling businesses to share real-time product information, optimise inventory and avoid inventory discrepancies and write-offs is now essential.

The good news is that 96% of the respondents want to improve the business relationship across the supply-chain and consider such sharing of near real-time channel data to be a business imperative.  In addition, 78% want to understand more about their channel partners in order to respond quickly and effectively to wider consumer trends, improve the effectiveness of specific campaigns and also to forecast risks.

Perhaps most interestingly, the report found that channel data collection and analysis processes vary widely.  Effectively ‘one step removed’ from the customer, the ability of manufacturers to collect, collate and analyse business critical customer data – and devise effective strategies for manufacturing, marketing and logistics – is directly impacted by how different channel partners provide information.  The manufacturer – at the very start of the process – needs to take more control as the lack of data discipline has the potential to leave these businesses exposed to what is actually happening in the market.  There are substantial benefits to be gained if companies can increase data sharing.  Building solid business partnerships based on more than just ‘loose trust’ is a notable one – particularly as having ‘trust’ in channel performance is no longer enough to satisfy board members, or stakeholders.  52% have already admitted that they have to trust channel partners to provide the accurate data needed because they can’t manage it in-house.  This is clearly a worrying state of affairs.

Yet with 78% wanting to understand more about their partners, and associated marketing expenditure, perhaps the channel is finally getting increasing attention from senior executives.   With 75% of respondents under pressure to prove return on investment (ROI) on partner incentives, the clock is undoutedly ticking.

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