In some of our previous blogs we spoke extensively about why Distributor Management System is crucial for managing a large-scale channel sales operations, especially for FMCG industry. While some challenges and resistance are imminent like they are in any other software implementation, in order to sustain a good business growth (or to achieve the same) and plug all the leakages in your distribution network, sooner or later you have to adopt a robust solution.
And if you already contemplating buying DMS software, probably you are facing the dilemma of ‘Whom should I go with?’. With the wave of digitization picking up globally, more and more players are entering that space. How then, do you arrive at the right provider?
The first and foremost thing for you to do is a ‘needs analysis’? Have an understanding of why you need DMS software, what is it that you would like to achieve. This need varies from company to company. Some may want to streamline primary order taking process, some may want to have distributor stock visibility, some may want to enable distributors with end to end secondary automation and some may want all. Hence, it is important to have a broad picture keeping long term business objectives in mind.
With your needs established, you move on to the most important and often, most confusing phase – evaluating the DMS providers. Let us start with a word of advice – when considering an DMS software, think of a DMS partner, and not a DMS vendor. What is the difference, you might ask? The difference is one of mind-set – a vendor is one you buy goods or services from, there is little strategic value expected beyond the act of buying and selling, a partner is one you team up with to realize a strategic vision, one whom you can rely on to guide you towards your goals.
Every provider will try to woo you through lofty credentials such as impressive clientele and numerous success stories. How do you cut through this clutter and settle on one? The key is in evaluating each of the prospective solutions against some important parameters. Here are a few that we recommend you consider:
- Availability of features: We discussed above briefly that requirement from a DMS varies for different organizations. Some may be immediate requirement, and some may be required six months down the line. Since the universe of all such requirements is quite large, not many DMS providers will have all those features available. So, it is absolutely important that you get a demonstration of all the features as per your business need and tick mark only after your full satisfaction. For example, many DMS may not have a functionality for distributors to transfer goods from one warehouse to another even though it is one of the desired features for any large distributor operating across multiple territories.
- Customization options: As you will be eventually using a standard solution and not getting a custom software developed for you, the system that will be demonstrated to you is unlikely to be exactly same as per your current business process or organization structure. So, you must check for available configuration options to customize it as per your need. For example, your distribution network may need 5 geographical levels – Region, Territory, State, District and Area. You should validate whether the system can be configured as per your custom requirement of geographical levels. The same applies for product hierarchy, taxation, trade schemes etc. If you are not very sure about configurability of all such elements, you may be in trouble during implementation and roll-out.
- SFA solution from the same vendor: It is always ideal for you if you get DMS and SFA from the same solution provider. It will not only eradicate the effort that you need to spend on integration otherwise, you will have a single point of contact for any data related concern instead of you mediating two parties both of which are unwilling to take any blame or ownership of such situations. Even if you already have an SFA solution in place, it will be worthy to check this from a futuristic point of view.
- Integration capabilities: Either you already have or very soon you should have a robust IT strategy that outlines complete sync among all IT systems with 100% data consistency. For example, you would want the distributor stock data to flow from DMS to SFA so that the sales person can have a complete visibility of current stock while taking order; or you want any change in master data in the MDM system should be automatically synchronized in the DMS software. Hence, your pick for DMS must have all necessary integration capabilities such as already developed APIs for important transaction and master data, flexibility in integration approach depending on the other systems it will be interacting with and an integration friendly data structure which would make any integration a less effort consuming task.
- Data analytics capabilities: After all, one of the key reasons to invest in a DMS software is to automate the reporting process and get meaningful data out of it. Unfortunately, post implementation, many businesses get stuck with a rigid reporting mechanism that eventually pushes them towards manual intervention. “What kind of reports and analytics do you provide? Do you support customized reports/dashboards?” You must ask these questions to understand your provider’s reporting strategy, their flexibility in providing customized reports (process, turn-around times, costs involved) and their expertise in data analytics.
- Implementation process: Understand how your DMS partner will ensure a smooth implementation and how experienced the team is in sales and distribution function. An experienced provider will have developed clear implementation practices through their many implementations. It helps you get a good understanding of the type and level of support you would receive (without explicitly asking that question!). A DMS implementation is a two-way street and the providers who make the implementation sound overly simple or one sided should not be your preferred choice.
These are some well-rounded pointers through which you can get a deeper understanding of your prospective DMS partner. Use this understanding to map your needs to their offerings. If done right, your business will be on its way towards a transformative digital experience.