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Survey Shows Link Between Manual Data Processing and Problems with Managing Channel Operations
Survey Shows Link Between Manual Data Processing and Problems with Managing Channel Operations
InfoNow | 24 Jul 2008
Survey results published today from Pembroke Consulting show a surprising number of companies, many of which are technology providers, are still using manual processes to collect, analyze and report on sales data. The survey explored the data management practices of more than 100 technology, manufacturing and pharmaceutical companies. Though these companies sell 80 percent (median) of their products through indirect channels, more than half haven’t fully automated their channel data management capabilities. As a result, these companies are experiencing significant problems with poor data quality and struggling to effectively forecast and plan.
The channel data automation study, commissioned by InfoNow, asked managerial and executive-level individuals about their most common data management problems. “Receiving incomplete data from (their) indirect channel” and “basing future sales plans on ‘best guess’ estimates” were among the top complaints. On average, these companies have more than 165 distributor and reseller channel partners. One respondent explained that their company received more than 20,000 lines of information on channel partners’ point-of-sale data each month and had to review it – line by line – to determine sales credit.
The study also found that, among companies who manually process data:
72 percent frequently or very frequently discover discrepancies between internal sales data and the data collected from indirect channel partners
72 percent said sales data is frequently or very frequently not ready quickly enough to be used for sales planning
78 percent frequently or very frequently makes sales plans based on “best guess estimates” rather than actual sales data
"Executives in many industries report significant challenges in their company’s ability to gather and use channel data effectively," said Adam J. Fein, Ph.D., president of Pembroke Consulting and the study's author. "However, companies with higher levels of automation experience fewer problems getting accurate data and using these data for real-time sales planning."
“Companies regularly grapple with business problems that impede innovation, decrease productivity or prohibit full revenue potential. We commissioned this study because exploring and understanding those business problems is the first step in tackling the cause of the issues and finding a resolution,” said Mark Geene, chief executive officer at InfoNow. “We were surprised at the level of frustration expressed by companies that are manually processing data. It’s not only time-consuming and error-prone, but it also impedes effective management of channel operations.
“Just as customer relationship management changed the landscape for companies that sell direct, channel data management will revolutionize how companies manage sales through partners,” Geene concluded.
Of the 124 companies Pembroke Consulting queried, 44 percent are in the technology industry; 40 percent are in industrial and building products manufacturing; and 17 percent are in pharmaceutical and healthcare products. Nearly a quarter of these companies have annual revenues more than $5 billion; 24 percent have annual revenues between $1 and $4.9 billion; 38 percent have yearly revenues between $100 and $999 million; and the remaining 16 percent have revenues below $100 million. The majority of the companies, 67 percent, are publicly traded.
To view the complete survey, visit: www.infonow.com/cdmstudy.
Channel Data Management: Gaining Insight into the Channel
Channel data management (CDM) is the process of collecting and transforming point-of-sale transaction and inventory information from the distribution network of companies that sell products or services through distribution or reseller channels. The process starts with collecting the individual sales and inventory transactions from the channel, followed by cleansing and standardization, then identifying the business entities included in those transactions.
Beyond capturing and cleansing data, CDM enables manufacturers to analyze data and make more strategic business decisions. CDM helps companies understand, for example, how much is being sold through the channel and to whom, while also tracking channel inventory levels. Functional areas that require sales channel information include channel sales and marketing, finance, and business operations.
About InfoNow Corporation
InfoNow is pioneer in software-as-a-service channel data management solutions, and a technology leader for companies that sell through direct and indirect channels, such as resellers and distributors. Based in Denver, Colorado, InfoNow offers a comprehensive suite of applications that enable companies to leverage existing point-of-sale and inventory data to more effectively and efficiently manage their sales channel. For more information, visit www.infonow.com.
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