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A partner relationship management strategy seeks to improve business processes through better communications between a business and its channel partners. In some ways, it is closely related to customer relationship management. The term is usually specifically applied to relationships between businesses, however.
There are a number of different forms that this strategy can take. In some shipping and receiving departments, for example, suppliers must deliver within a certain time frame. In the busiest of locations, that window could be as little as 30 minutes. When traveling across a large geographic region, that can be a hard target to hit.
Using software and other communication tools often provided through a partner relationship management strategy, suppliers, shippers, and the end users can keep in constant contact with each other. This means the end user will be able to know where each item is each step in the process and when to expect it. Depending on the situation, this may allow a factory to adjust production so that the entire operation does not shut due to supply concerns.
It is also important for a manufacturer and reseller or retailer. On this side, the software allows the producer to understand when a certain product is in demand and allows that producer to adjust his processes to make more. Without this benefit, a manufacturer would need to wait for an order from the retailer or reseller. That could delay the process and thus allow both sides to miss out on valuable sales.
In addition to communication, partner relationship management can also provide services in other areas. It may include a partner loyalty component, for example, which provides a benefit to both companies. As those relationships are solidified, it provides a good customer base on which both can depend.
Though the idea of forming business-to-business relationships is not a new idea, the extent to which it is taken in this situation is. With the growth of the Internet, businesses can be in closer communication than ever before. As business become more specialized in the services they provide, it is creating a greater interdependency between them and, therefore, a need for enhanced relationship management applications. With products and suppliers located all across the globe, a better system for real-time communication is also needed.