Entries Tagged 'partnership principle' ↓

Building an Allyforce, both in principle and in execution, can work for a range of companies.  The primary criteria are:

• Are sales conducted by an individual person knowing the right person to connect with?
• Is finding the right person or right company a large part of the challenge?
• Do you have complimentary, non-competing solutions in the market who want to work with you?

So, for example, someone who sold to hospitals and there are only 5 hospitals in the entire area and the only person who could buy was the head of surgery would not benefit.  They know exactly which accounts to call, and there aren’t many of them.  They know the exact person within the organization to reach and already know the name and title.

Whether you were a big company or a small company in that scenario wouldn’t matter.

Let’s take a look at how big, medium-sized, and individuals can benefit from this approach and mindset.

The individual targeting individuals

If you are a chiropractor or a wedding planner, you might not thinking of proactively reaching out to people.  You could depend just on search engine marketing and blogging and that could work.

But imagine if, for example, you were a wedding planner, and you build an Allyforce relationship with three Allies: a caterer, a florist, and an invitation designer.  And you felt their products and service were good.

Could you imagine setting up an easy way of sending (and tracking that send) contact information to the caterer, the florsti and invitation designer and enabling them to forward information to you.

You could do this via email or spreadsheet or with a proprietary tool (to address the logistics of it) but set that aside for a moment: do you see the power of building an Allyforce in your local community?

The small high-tech company targeting Fortune 1000

High-tech companies targeting Fortune 1000’s need to be able to touch as many account and touch the right people in those accounts.  Fortune 1000’s can be notoriously hard to navigate to find a decision-maker — wouldn’t it be great if you could collect and assimilate information from people who are doing the same type of prospecting as you?

Let’s take for example you sell traffic management software.  You could work with someone who does logging, DNS management, and maybe high-end routers.  You’re addressing the similar space of managing the traffic and speed of the network, but don’t compete directly.  Some of your customers could be great customers for those in your Allyforce; some of those were you lost deals could be equally great.

Plus, your Allies will know about accounts you  haven’t thought of and warn you of those you are.  It’s a good fit.

The small  low-tech company targeting SMBs

When targeting SMB’s, you can actually broaden your potential network because the decision-maker is often the same for many functions.  For example, an environmentally-friendly credit-card processor was paired up with a local advertising company and a restaurant-supplies company.  Why?  Restaurant owners made good shared targets for credit-card processing, for local advertising, as well as for restaurant-supplies.  Imagine the need to target a wide area of local business owners without an Allyforce behind you.

Large companies targeting large companies

Here’s where I initially got the idea: I worked at IBM where there are several reps each with their own lines of business and products…all calling the same companies in the same territory.  Problem was, there was no way to leverage each other’s meetings and relationships.

Large companies can often benefit by enabling individual reps in the field actually share contact information with each other at the prospecting level and provide real-time updates on accounts and personalities.

Imagine if a company that had a division hardware would effectively communication across its field sales reps what is going on with the division selling software.

The central premise of being able to truly share in revenue-generating partnerhip can apply in many instances, again, given the nature of the territory, the product being sold, and the partnerships being formed.

It’s a huge amount of unlocked potential waiting to be tapped.

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I read Guy Kawasaki talk, albeit briefly, about partnerships — the good and the bad.

He hit it on the nail by saying:  Partner for "spreadsheet" reasons.

The most important spreadsheet reasons are increasing revenues and finding new customers.

One of the key success criteria is whether these deals are "win-win."  We think the cleanest way to forge a relationship is one where both sides are able to uncover new leads, accounts, and opportunities for each other.

The concept is simple and powerful.  The execution needs several critical success factors which I’ve been discussing so far:

* visibility

* velocity

* reciprocity

* accountability

Put these in place for a good spreadsheet, win-win partnership and you’ll be seeing revenues increase.

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As I am discussing with companies why they don’t build a powerful network of referrals, one of the things that came up was the accountability.

Internally, the accountability is relatively easy to do.  The sales manager set metrics (such as the number of outbound calls) and measures them.  It’s pretty straightforward.

But the sales manager for Company A has no influence over the sales reps for Company B.  Company A can only really give names and accounts to Company B reps.  But do you see how there could be some initial distrust as well as just lack of momentum?

Suppose Sales Manager A gets his reps to start giving Company B reps contacts and access to their accounts.  What happens if they don’t see anything in return?  Where is the accountability?  You could say Sales Manager A contacts B and says, "Hey, we’ve given you a bunch of leads, what about your turn?"  There now becomes some sort of peer pressure to work it but notice that, first, there needs to be time for the sales manager to connect with all his reps and make sure that they have all, in fact, given leads and asked for some in return.  Now Manager A has the data to take to Manager B, who goes to all his reps and asks, what is going on, and needs to wait to see if anything is happening?

Meanwhile…Company A has lost interest…which makes Company B lose interest.

The issues: no "neutral zone", no clear metrics and no enabler for this kind of revenue-focused collaboration.

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Here’s an area which I believe can be developed further, but it often takes a good understanding of your own business in order to implement.

In this book, it comes with an approach of enabling the company to make $10-$30k more almost instantly, with absolutely no effort, no risk, and non investment.

Having the ability to provide dollars to the partnership based on success is key.

Let’s look at it between two technology companies that are selling complimentary, but non-competing software.

By providing a beefy and meaningful amount of the gross margin, you effectively get free marketing.

Technology companies often create margins of 20-30% to resellers, so why not offer that to partners as well?

This approach applies to individual business people as well, whether you are offering intangibles such as consulting or e-retail.

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This book is so good, I’m going to be quoting from most of it.  It articulates real-life examples of how to put the partnership principle into play and why.

Developing a host-beneficiary relationship means going beyond the conventional sales and marketing routines and tapping into related products or services that your clients need.  It means offering your product or service to somebody else’s clients in a related field.

He gives an example where Xerox spends say $10,000 to bring in 1,000 prospects to whom they sell 10.  Every company experiences this, where they have leads and contacts, but only a fraction get sold to.  What happens to the other 990?

Nothing.  The money was spent to draw them in, but the Xerox got nothing.

The writer proposed that someone work with Xerox and say, "If you can’t sell Xerox solutions, sell mine, and you’ll get a piece of the profit.  Don’t want ot do that, just give me the leads and you’ll get a share of ever sale."

Now that 990 leads gets transformed into real money and recovers the marketing expense.  That is money which goes straight to the bottom-line of Xerox.

Allyforce lets you optimize all those leads and participate in the profits.

It’s a powerful idea.

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Partnership announcements come with great brouhaha and excitement.

Alot of work typically goes into them, particularly between technology companies.  A strategic discussion and a technical fit often needs to be worked out.

Often times, the partnership fills in a gap in the marketplace, and it’s typically a smart thing.

So regarding the earlier post, this type of product-oriented partnership fills in one need, which is reducing internal resources needed to build out the product.

But I’ve seen it miss the second shoe-dropping: generating more sales.

The concept is sound: non-overlapping installs or differing prospects can be exchanged and shared, as they should be.

But field-level execution is where partnerships fail.  How do individual reps extend the partnership?  And most companies fail at that.

We’re exploring how the Partnership Principle can enable companies to address this and extract fullest value out of partners.

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The concept of "partnerships" has been around for a long time, nothing new.  The requirement to do partnership and do them well is reaching an urgent pitch.  And most companies, from big to small, do it poorly.

The term "partnership" has lots of implication, but the definition of success that I will be looking at focuses on creating value: more customers and more revenue.

Why are partnerships essential?

For the vast majority of companies that don’t have market dominance and scale, partnerships is essential because of constraints or challenges in these areas:

• internal resources: don’t have enough resources to do all things
• customers: customers have more choice or higher buying criteria

Those two areas are the areas where a partnership needs to develop and plant the seeds for growth.  If someone cannot articulate how both parties can reduce constraints around one or both of these areas, the partnership from a value-creation perspective is limited.

Let’s see why most partnerships fail…and how we can develop true partnership principles

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In  general, I think people instinctively get the idea of working with others for mutual benefit.

I had a conversation with someone who — off the bat — just wanted information, details, insights, a battery of questions of what he wanted…all without offering something in return.  This is a total stranger who approached me.  We’re still meeting, but how would you go into this discussion?

Warning signs: if that’s your approach to partnership — gimme, gimme, take, take — it gets flagged early.

Come bearing "gifts."  Put something out as a strawman: "Not sure if this works but here’s what I can provide you."

When I partner, I hunt and search to find someway that I can provide value, typically a contact name at minimum to help.  If I don’t — I try to find some common ground, or a promise to find them a lead — early in the conversation.  It’ hard — sometimes it’s not that clear and you have to rely on an existing relationship.  There are plenty of times I’ve asked someone I’ve met or know for just plain out help and the promise that someday something will circle back.

But you can smell it when someone’s approach is to take, and it colors future discussions as it has with this fellow.  The meeting will still happen, but now everything moving forward has that smell.

Come bearing "gifts" and a creativity to at least seeking to find something that will benefit them.  Strong partnerships can get built from that foundation, and I’ve seen some remarkable people do so and I continue to try to learn from them.

Think "give" before you "get."   

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Time is money.

A sales reps job, as well as the organization that supports him, is to maximize their resources, of which the primary one is time.

Anyone can make their quota…if they have enough time.  And if the quarters were longer.

One of the biggest, yet unavoidable wasters, is spending time with people who don’t ultimately buy.

Sure, you can do all kinds of qualification…but even if the deal is qualified, do you win every single one of them?

Let’s try this: even if you won every single one of them, how is that deal going to make you more money moving forward?

Monetize the Loss

I’ve lost deals that were well-qualified in the sense of right leve, budget, pain.  We’d meet huge numbers of people on the implementation team, the decision-makers, and so forth.  But, at one point, a requirement would come up that we couldn’t sell around.  Who knows: it could be the competition got there first and set up a different vision.  In some cases, really, customers do absolutely need a feature that isn’t offered.  While you can continue to try to sell the “value” of not having the feature and some of the other capabilities…at some point, their need is not a fit with your capabilities, particularly in fast-moving technology.

Well, what happens then?

If I could take those contacts and, probably more valuable, the account information and translate that in a whole new at-bat, wouldn’t ‘that be worth it?  Maybe translate it across multiple sales allies and give me multiple at bats.

The nice benefit if you proactively do the introductions is that you get to stay in touch with that lost account, because you never know when things change.  More on that later.

Monetize your losses into new opportunities.