By Jim Holland, Senior Product Marketing Manager
While we watch the tragedy of COVID-19, the novel coronavirus, unfold and the impact on lives globally, the realism is the virus has unplanned personal, global, and economic impact.
From a high tech and semiconductor perspective, global markets and production have brought many options in product design, manufacturing, channels, distribution, and ultimately end–customer markets. With over 75% of products being sold indirectly, companies have a vast array of routes to market with unlimited channel partners.
How will this unplanned crisis impact high tech and semiconductor companies and what can be done?
Andre Neumann-Loreck, founder of On-Tap Consulting, shared in ‘Crisis mode’: Coronavirus disrupts the heart of electronics manufacturing in China “Companies that are building hardware or physical products are in crisis mode now, and that’s true whether they’re getting finished goods built in China or relying on China for components and sub-assemblies.”
“Well-run companies typically have plans for production disruptions, and if companies have identified second suppliers for key parts, they may be able to keep producing current products at a slightly slower pace” shares Jayashankar Swaminathan, professor of global operations at UNC Kenan-Flagler Business School.
This global disruption must be evaluated by all facets of your organization and while sales and channel leaders are looking at revenue impact, supply chain leaders are trying to answer the manufacturing questions and plan accordingly.
The strategic question for sales and channel leaders is: “How do we plan for channel disruptions while maximizing revenue every day?” The reality for most high-tech manufacturing and semiconductor companies is introduce strategies and ways to support unplanned revenue execution crises.
The unanticipated effect of available inventory potentially leads to reduced market demand, margin erosion, lack of supply, and causes manufacturers to rethink their routes to market including incentives to distributors, resellers, and ultimately end-customers.
How Model N Can Help You Plan and Execute for the Unexpected?
To ensure your organization has real-time and consistent insights into current inventory, by partner and region, knowledge of end-customer sales, and how product backlog activities (those quantities ordered, while the product has not been fulfilled) you need to automate your channel and its intelligence. Automating these key areas, validates your global inventory assumptions, provides insights into what inventory movements, and provides planned information.
With Model N, your organization can:
- Automate the management and insights of global channel partner data
- Create a trusted system of record for channel sales planning – but expected and unexpected
- Manage, identify, and match channel selling patterns and trends to maximize inventory
- Understand backlog orders and their impact on the channel and future end customers
- Introduce a revenue management continuum that breaks the siloed constraints