Be strategic about non-strategic partners!

This is undoubtedly an era of partnerships and alliances-focused growth and the trend is going to continue at a faster pace than before. Every company does business through formal or informal partnerships. Companies want to fill up the gaps they have in their products through collaborative approaches and to achieve that, they need partners. Sometimes these partnerships are straightforward, logical (e.g. AWS, GCP, etc.) and strategic in nature, as they have a larger business impact, and drive more revenue. On the other hand, there are many more inbound and outbound prospects that partnership professionals have to evaluate to determine the fit. If they decide to onboard them as a partner then, such partners are referred to as registered or emerging partners.? These are the set of partners who are not on priority or might not proved their worth yet, in terms of generating revenue, strategic value prop, or M&A target.?

At a high level, these partners can be put in three buckets:

To address these situations within the (limited) budget that you have for managing partnerships and investing in the right set of partners is very important.

In the case of bucket #1, you have tested the waters together, and both sides understand the potential of a partnership but are not completely aligned on all the GTM (Go-To-Market) aspects, joint success is not consistent. In this scenario, you will have to research the market and partner's value prop again. You also need to reevaluate certain other factors like,

1. Does this partner still fit your ideal partner profile? Or has something changed??
2. Is Partner a top player in their industry and market? Or there are other players who have emerged???
3. Can a partner serve your ideal customers (both land and expand)??
4. Can a partner source and influence the deal??
5. Is the end customer excited about your partnership??

These are a few important considerations to evaluate why a partnership is not yielding the benefits that were expected. These factors will also help to decide on further investment in the partnership and how long you want to keep doing it.?

#2 and 3, it is more tricky.?

Let’s say you need a partner more than they need you. First of all, it’s very important to research and evaluate data to find out the reality. It may need you to take a very critical view of your partner strategy, lots of data to be analyzed, and leadership convincing. Consider a few of the simple yet important aspects,??

1. Are you running behind a partner because your competition is doing so? E.g. Typically everyone wants to have a partnership with Accenture but will that yield in sizable business? Or going with mid-tier company like Persistent Systems is a better option to start with??
2. Is there any other option that can help you drive the business in the same market segment or geography? E.g. Stripe and Adyen are serving similar customers but one is more dominant in US markets and the other is in EMEA and APAC etc. It sometimes helps to have both and align regionally.?
3. Can you find a comparable partnership option to drive business in different market segments? Price point? E.g. you may see success in US markets with Salesforce but with Zoho in the Middle East etc.?

In case of partner needs you more, you can always evaluate the benefits and trade-offs of that partnership. You can set measures and expectations aligned to the partner program with the partner.?

1. What are the basic rules of the game? What does it take to attain higher or strategic partner status??
2. Does your partner align with your ideal partner profile? How big is their sales team and market penetration??
3. Are they unlocking specific use cases? Can they scale fast??
4. Are they ready to invest in practice building??
5. Are they already in any of your customer’s accounts and help to expand? Or replacing your competition??

It is also important to understand the partner’s point of view and challenges and why they are not able to close more deals. It may be related to enablement, marketing support, or sales alignment. Without overdoing or going out of the way as per your partner program structure you can take a few small steps to help. Sometimes it helps to make warm introductions with partner sales and sales executives to drive initial momentum. If a partner proves their value (time-bound expectation) then you will hear it from the field. In that case, you can decide if further investments are worth building that relationship.?

Often with sizable companies, partners get onboarded through standard partner portal applications. Without initial onboarding and enablement support any partner will struggle with building practices, and communicating their value prop. The risk is partner then tries to spread thin. E.g. in the case of Salesforce or AWS, If partners try to focus on all the products and industries, then it’s going to take a long time for a partner to show the value. Rather picking up a product or two, and one or two industry verticals can result in faster results. If a partner is willing to take a risk on building a business in less crowded industries (e.g. non-financial services, Healthcare and Lifesciences, Retail, etc.) they generally find more cordial relationships with bigger companies, even if their size is smaller.?product and sales team work with smaller partners as bigger partners will rally once the market use case is validated.

Smaller partners are large in number and hence leadership needs to put more time and energy into evaluating them. Considering low revenue outputs budgets are limited and such partners may get managed through a programmatic approach without a named partner personnel assigned. At the same time when you work with such partners to address specific target markets, industry verticals, and products they can make wonders for you and for them.?

No partnership leader wants to be in a situation where they are attaining the partner recruitment goal (just a number) but later it becomes administrative overhead for them with no revenue upside. Getting answers to the above questions will allow you to be on track with your quarterly and yearly goals without wasting resources. Having a good governance model helps in collecting data and analyzing it to make data-driven decisions.?

Partner Program Managers, Partner Account Managers, and Partner Development Managers need to work in sync to capture share, and analyze this data to come up with appropriate partners and invest in those relationships to fuel growth.

Therefore it is very important to pick such partners strategically even if they are small and hedge your bets. A partnership should result in growth for both parties. Once you master that strategy, capture your learnings, and develop your best practices, you can strategize on such partners and graduate top performers to the upper tier to generate more revenue. That’s why emerging partners need to be handled strategically, to rip the benefits of partnership.?

Partnership is a win-win game and you need to play it correctly.