The 3 P's of partnerships

For partnerships to be a source of strategic advantage, we need an alliance capability founded on patience, persistence and pragmatism.

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.

What’s the problem

There are many reasons partnerships fail, from weak executive buy-in to lack of preparation and resourcing. At a higher level, partner programs require a significant commitment and the capability and capacity to support them. The typical culprit undermining a program’s success is a snatch-and-grab mentality: get in, grab the cash (revenue) and get out.

I’m continually amazed at the number of smart, insightful founders and executives who believe that this approach will work. It won’t. What’s most commonly at play is a disconnect between the control they exert over their own teams and those of their partners. As I’ve written about previously, this misalignment of commitment and expectations predictably leads to failure.

What to do about it

Have patience

In partnerships, as with most things, timing is everything. It’s about being in the right place at the right time. When a prospective partner says “not now,” don’t take this to mean “never.” If you’ve built alliances and channel partnerships into the foundation of your business model, be prepared to develop them over time.

Patience may seem a luxury when quarter- or year-end is approaching and you’re digging under sofa cushions to make your number. So while you can’t wait indefinitely on coy or indecisive potential partners or tolerate under-performing partnerships, for those you deem truly strategic, time to work the process is a worthwhile investment. Further, if you’ve structured them correctly, you’ll have ample leading indicators for the health of your partnerships. Year-end surprises are a clear sign they aren’t.

Be persistent

Particularly if you’re a small company pursuing a partnership with a larger player, there will be a litany of calls unreturned and emails unanswered before you succeed. Regardless of size, persistence and thick skin are critical.

Here, it’s worth calling out some of the key differences between strategic alliances, point-in-time business development deals and channel partnerships. Each requires its own approach.

Channel partnerships necessarily require a campaign, targeting a large number of candidates in order secure enough partners to reach goals such as territory coverage, revenue or units targets. Like direct sales, a willingness to persist in the face of ambivalent prospects and outright rejection is a must.

Business development deals are often more opportunistic, pulling from an ever-evolving pool of potential partners within an ecosystem. Here, persistence translates to an ongoing commitment to the capability and function of your business development team. They must achieve their targets, but they need their leader’s commitment and persistence behind them in order to do so. A short-sighted approach or use of the wrong measurements sink business development teams.

Strategic alliances, traditionally between two companies of equal stature, if not size, require the persistence to see the process through. These are partnerships both parties have deemed strategic. They aren’t readily replaced or opportunistically built, but created on the back of shared vision and bold objectives. As such, each party must persist through the hard slogging of bringing the alliance to fruition.

Be pragmatic

Like every part of your business, partnerships must perform. Patience and persistence shouldn’t give way to dreamy-eyed idealism and romantic ideas of what an alliance could or should be. To help maintain this balance, approach partner development as you would sales: using a pipeline with defined stages and associated limits on time and resources as they progress from stage to stage, an integrated process connected to functional areas like product, marketing and sales, and clear metrics for success. In other words, stick to the fundamentals.

© 2024 Shawn Yeager. Made in Nashville.