The protection of both your brand and the integrity of your channel is essential to your company’s success. Identifying and eliminating areas of non-compliance (e.g. channel incentive programs, inaccurate or excess discounts and rebates, and gray market activities) with OEM channel partners can impede loss of margin and price erosion.
Yet many organizations lack the necessary resources, processes, and expert support to effectively implement, and manage programs that address areas of non-compliance that threaten a brand’s reputation and the OEMs bottom line.
At Connor Consulting, our team has decades of experience building global channel compliance programs helping clients recover hundreds of millions in excess payments due to non-compliance, systems and control weaknesses, and partner abuse of incentive programs.
Establishing Internal Processes and Controls
Our team recently performed an internal assessment associated with the pricing programs of several OEM vendors to document the processes and risks associated with channel programs at one of the largest technology hardware manufacturer in the world.
Through our proven best practices and years of compliance experience, we established a project plan that consisted of the following components:
- Interviews with relevant stakeholders associated with channel processes, (deals desk, operations, pricing, claims, marketing, etc.)
- Review of reporting requirements
- Pricing guidelines and sample partner distribution agreements
- Testing of credits/payments issued to channel partners across the various pricing programs
After completing dozens of interviews, review of documentation and policies and analyses performed, we presented findings to the OEM across 14 specific findings both financial (i.e., more than $20 million) and non-financial.
For each finding identified, we presented supporting analyses and provided recommendations and best practices for each of the areas of findings. The OEM immediately set up project teams to address the findings and begin implementing recommendations. The OEM implemented a couple of simple to implement internal controls associated with its claims processing systems and updated a pricing guideline that effectively solves issues that represent 60% of the financial findings identified. Additionally, the results of these internal processes and controls assessment are being used as a framework to guide the design of future state systems and process goals for continuous channel management evolution at the OEM.
Get Started with Unparalleled Expertise and Service
Our combination of globally distributed consultants and a technology-first approach can help you establish a comprehensive channel audit program that can pay for itself within 12 months. Getting started Is simple with efficient proofs-of-concept that are not resource intensive. Contact us today!