Partner Program Guiding Decisions Policies and Culture: Guidance on Your Critical Decisions

By T.C. Doyle

“Grow” may be a goal but it is no strategy.

Differentiating between the two is just one of the many things you need to understand as you begin to build your channel. In addition, you will need to learn the basics of compelling partner propositions, channel economics and partner program building blocks. Before you get to these, however, it helps to look inward at your existing organization, specifically to your company’s culture. Believe it or not, culture will play a significant role in determining whether your organization can succeed with partners. Here’s why.

Know Thyself

If your culture is hyper-competitive, controlling and/or embraces a winner-take-all ideal, for example, then it is unlikely that you will win many fans in the channel. You will need to share the fruits of your efforts more when you rely on partners, after all. You will also have to share your best insights and your expertise to those whom you barely know.

As unsettling as that may be, it’s true just the same. Likewise, you cannot expect to thrive in the channel if your company is punitive or uncollaborative. Channel partners often represent several brands and may recommend one of your rivals over your products or services in certain situations. If you retaliate unfairly, you’ll likely develop a reputation for being hostile.

Similarly, if you’re overly rigid or difficult to work with, some partners will call you out for it quickly. Others will simply walk away. If customers today find your company difficult to engage, don’t expect partners to find it an easier unless you adjust.

When you begin on your channel journey, it helps to do so with a proper attitude and commitment.

Hone Your Partner Proposition

The No. 1 reason channel companies will work with you is the quality of your partner proposition. If the quality of your proposition is high, partners will take your certification courses, represent your brand faithfully and treat leads with great respect. They will also share information, competitive insights and profits willingly.

If your proposition is weak, partners won’t respond. If you cannot fathom why they would sacrifice time and energy to do business with you, in other words, don’t expect them to do so.

To better understand how compelling your partner proposition is, consider your current sales process. It typically starts with your product or service, then passes through several stages including lead generation, opportunity, sales, delivery, client success and, finally, after-sale services.

As you build your partner program, you need to understand where partners can help reduce your bottlenecks in your go-to-market strategy. Performing this exercise will help you craft a differentiated partner value proposition. It will also help you understand the different types and numbers of partners you need.

Finally, persuade your executive management team to ask itself one difficult question: does it view partnering as a cost or an investment? The answer will help you, a channel practitioner, better understand your organization’s commitment, expectation and understanding of doing business with partners.

Understanding Partner Economics

If you sell directly, chances are you understand your business economics. You know, for example, your costs when it comes to generating and qualifying leads, making presentations and demonstrations, and crafting evaluations and proposals. You know key metrics as well, including the number of leads you need to close a new customer.

But for partners? The math can get fuzzy. Understanding partnering economics, thus, is vitally important.

In a direct model, of course, a vendor or innovator incurs upfront sales costs (personnel, automation, campaigns, etc.) and risk. As a result, every new piece of business takes money from a vendor’s bottom line.

With partners, who already enjoy ongoing relationships with customers, a portion of sales costs are reduced. This is because partners leverage existing relationships and other sunk investments such as sales training, marketing know-how and more.

That said, partnering comes with its own set of costs. This includes the cost to train, manage and recruit partners. Then there’s the cost of commissions and other forms of rewards.

In general, doing business through partners can be more cost effective. But as the saying goes, your mileage may vary.

Creating Your Partner Roadmap

Start by listing your priorities, be they growth, market expansion, customer satisfaction or even company valuation. Next, map your total addressable market (TAM) to the number and type of partners you believe you need to achieve your objectives. After, assess your readiness, including the strength of your partner proposition and your competitive positing. Finally, take a look at your messaging: would it appeal to you if you were a partner, or would it miss the mark?

Taking these steps will help you determine if you have the right type of partners, whether you need more and whether your expectations are in line with reality.

Finally, start thinking about the automation your company will need to manage, enable and reward your partners. Capable programs do not run on spreadsheets in 2021.

Additional Steps

In the blogs that follow, you will learn more channel basics, including assessing partner readiness, developing effective policies and processes, and addressing specific challenges that arise in early stage program development.

Up next in Blog Two: Supporting Current Partners.

*The Channel 101 series was produced with insight and information provided by Tenego Academy. Tenego Academy is a Cork, Ireland-based company that provides support to companies wanting to grow their organizations with third-party “channel partners” be they dealers, agents, referral partners, distributors, consultants and more.

Tenego Academy’s 12-part “Build Your Partner Program Like a Global Leader” education program helps companies looking to create, grow and/or optimize a partner program regardless of their size or market focus. No matter where your company is in its channel partner program journey, you will benefit from Tenego Academy’s 12-part program, which covers everything from channel strategy to partner recruitment to automation and more.

T.C. Doyle is the Channel Growth Evangelist at Impartner, the leader in channel management and Partner Relationship Management (PRM) technology. A journalist, book author and analyst, Doyle has worked in media for three decades. As channel evangelist, Doyle produces podcasts, case studies, e-books and more for Impartner. Doyle can be reached at [email protected].