Unify to partners: 'You achieve, we pay. You don't achieve, we don't pay'

Unified comms vendor says it wants to stamp out culture of entitlement in its channel

Unify is turning its channel sales model "on its head" as part of a long-term plan to stop overpayments to partners and encourage them to work harder for rewards and incentives.

The unified communications vendor is linking sales performance more closely with rewards to put a stop to distributor and channel partner "entitlement" around payments.

Peter Saudan, vice president of global sales operations at Unify, said the message to partners is simple: "You achieve, we pay. You don't achieve, we don't pay."

Saudan indicated that the overhaul of Unify's channel payments system comes after a period of blind investment in channel rewards.

"Historically as a company - until the beginning of 2016 - all our programmatic rebates were given upfront to our distributors, and they handled everything, and we said thank you and they didn't really deliver for us. So, we completely turned the entire business model on its head."

He explained: "[Partners] had previously structured their margins so they took all the margin upfront and added it to the bottom line. They basically did a cost-plus selling model. Now they have to prove and deliver performance over the whole period to achieve all the rewards and incentives they used to receive. The margin is the same, but they have to work for it, and if they don't, it's not guaranteed and they could see a drop in their margin of up to five per cent if they don't deliver."

Saudan said Unify is focusing on stripping out complexity from its sales systems while pushing automation and standardisation of its internal processes. It is currently working with channel data management software company Zyme on the new sales data platform.

"Traditionally we had data but didn't do anything with it - we just dumped it into a centralised repository. Now we're starting to proactively mine that data and use it to reward our distributors correctly for delivering real growth to us, rather than just driving entitlement taxes," Saudan said.

Saudan admits the company saw initial pushback from partners.

"The channel screamed for a long period of time, but actually we've now got a channel that works much more efficiently and are working for us, not just taking the money," he says.

"By using the data around inventory reporting, we're starting to get consistent sales across the board. We're seeing new technologies pick up that were struggling or were a blip, because we do a promotion that drove short-term activity and then went down again. We're using it as a behavioural change agent, which is making a significant change in the way our channel views us."

Saudan noted that both productivity and the average sale per reseller is up, but the vendor is "a long way from where we need to be." He said the long-term plan is to incentivise distributors to target different types of resellers, reduce competition on pricing and wean distributor partners "off special pricing on everything".

Recent research by Zyme claims 61 per cent of the vendors have had to cap financial rewards because of previous mistakes with overpayments.