Defining value in partnerships

A partner manager achieves business outcomes through a clear understanding of the exchange of value. I find that channel misalignment and conflict stems from a lack of understanding of this exchange. Channels are so diverse and exciting, but for this post I will single out some of my experiences working for a fast-growing cloud vendor.

Breaking down some value dynamics:

1. Customer success – The partnership cannot win if you cannot create real, tangible and measurable value for customers. Customers might manage a portfolio of investments, which they track and report on. The partnership must always inspire customers through innovation and delivering clear business value. Regarding partnership value, customers will focus on revenue, profit increase and strategic enablers - more on this in a different post.

2. Revenue/Profit – A Key driver and is probably the best indication that a partnership is working. In the context of channel misalignment and conflict, let’s discuss gross revenue and profit.

• Some vendor partners are very interested in showing revenue growth. These partners will want to resell your products so that the total value is transacted through their books. If your policy is not to resell then you may experience a misalignment of value objectives.
• Some vendor partners may focus on profit. In the cloud world the vendor may transact directly and the partner focuses on delivery. If the partner is geared to make a profit through delivery excellence you have a winning formula, in which case get out the champagne!

3. Aligning business visions – I will use my current partner director role as an example. The partner I manage has a vision to enable ‘digital transformation’ for their customers. They will partner with vendors that contribute to this vision. ServiceNow is a perfect partner for ‘digital transformation’ therefore we are well aligned. We create great outcomes for customers and therefore all parties see value. Great alignment!

4. Vertical market penetration – As a cloud vendor we do not always have deep vertical expertise. We therefore partner with companies that have specific vertical expertise. I managed DXC Technologies who have excellent expertise in healthcare. This is therefore a perfect partnership whereby the partnership enables application modernisation by providing modern cloud-based applications for the health sector. Value for the vendor, partner and customer.

5. Regional market penetration – This is an easy one. Fast growing cloud vendors need and can expand using partners for global reach.

6. Quality delivery – If you cannot deliver quality implementations to customers all that has been said in this post in null and void. Cloud companies increasingly rely on qualified, passionate and innovative partners to deliver their applications and solutions. Implementation methodologies to reduce cost, risk and delivery time are important. Also, and increasingly so, sticking as close as possible to ‘out of the box’ implementations are a must to deliver true uncomplicated value. 

These are some of the defining elements in a truly engaged and aligned partnership. Focus fanatically on your customers’ success and understand the value dynamics that underpin your partnership, and you may just be successful!

+++ The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of current employer +++