No deal is the only deal you can do. No potential partner is the only one that fits. When negotiating a partnership, patience is key, but too much can be a bad thing. It wastes time and resources. Each deal you keep chasing represents an opportunity cost measured by those you aren’t. If the other party doesn’t share your sense of eagerness, if not urgency, it’s time to move on.
It’s increasingly difficult to produce examples of software or services companies that will escape a shift to—or at least a major embrace of—cloud computing. With this shift comes new business models, new channels, new products and services; in short, change and lots of it.
Unless approached with the right attitude and expectations, partner programs ultimately die a slow, agonizing death. The software industry is filled with companies whose partner programs sit dormant and forgotten, representing wasted capital and significant opportunity costs.
Prompted by a recent guest post on StartupNorth, similar to statements I’ve heard time and time again, I’d like to offer some candid advice and a bit of tough love for early stage founders and CEOs regarding why your partnerships keep failing.
The success of a channel partner should be measured by the outcomes achieved for the investment made. In other words, did you get what you paid for or more? If not, how do you restructure partner compensation in order to do so? Throwing money—in the form of deal margin—at partners in the hopes of driving the right behavior is the wrong approach. Pay must be tied to results, just as you would for direct sales professionals you employ.