Creating revenue-generating partnerships that work

Most of the examples have primarily been around technology, but I have begun to work with companies that are decidedly non-tech.  And the way you build an effective system and eco-system for allies is just as critical.

It can be a little more difficult sometimes because I have found that given the complexity, leveraging technology to enable effective parternships is essential.  But it does work.

Find out more with the upcoming:  “Allyforce: How Any Sales Organization Can Increase Revenues Faster Through Partnerships That Work”

Although I typically use the example of technology companies, it works well if you are not.  You need to meet certain requirements:

• The potential universe of buyers is large
• The person making the decisioin in the universe is often unknown
• You target people and companies that at least one other non-competing company is targeting as well
• IF finding that person and company faster and more directly, you can speed up your sales cycle

There are some companies where this might not make sense.

Purely consumer-drive marketing companies that sell through major retailers or grocery-chains, for example, wouldn’t apply.

Utilities wouldn’t apply.

Manufacturers who OEM to a handful of key accounts wouldn’t apply.

It’s not about what you sell, it’s about HOW you sell.

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This is a question I’m still trying to find the clear answer to based on interacting with companies.  Who Owns the Allyforce?

It is related to the field reps, so perhaps it is the Sales Managers.

But it is tied to getting names and leads, so perhaps it is in Marketing.

But it involves alliance partners, so perhaps it is for Business Development.

I still haven’t found a definitive answer yet.  I think it’s a powerful role to play, probably not to be played directly by one of these roles but the metric and results should certainly be managed by one of them.

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Wisdom of the crowds.

Imagine being able to apply a set of "spies" out in the field to tell you of potential opportunities that you may be missing.

Isn’t that the worst situation to encounter, where you could have competed, maybe even won, in a situation but didn’t even know about it?

With smaller and smaller sales staffs and harder and harder to reach decision-makers, the ability to get good, timely intelligence about situation where you could be selling is very difficult, but even more essential.

Good sales people collect information about the needs, the plans, the environment of their customer.  If your partners have good sales people and you’ve developed a good system for sharing, that’s powerful.  If you’re not doing this, your competition may, and where would that leave you?

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Another common objection I hear is that the company executives believe they already have "alliance" and "strategic partnerships."

I would agree: they do.  But what is the outcome of that?

But the questions in terms of assessing their success are pretty simple:

• Do you receive leads, say, at least five per quarter per sales person?
• Do you have weekly metric reviews of the mutual exchange of leads?
• Are your reps in the field exchanging "field-level information" about different accounts?
• Do they understand the basic question to ask prospects to find deals for you?
• Is there an effective, consistent, and measurable incentive-system in place?

Without putting something like that in place, it is often very difficult to successfully have a true revenue-generating alliance.

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I had a meeting with a VP of Sales discussing potential partners.

One partner they had been looking at as promising, but he said that the partner’s technology that would complement theirs wouldn’t be ready yet.

So he said they wouldn’t be a good fit.

This is a very common approach to partnership: they look at partners from a product-fit / product-enhancement perspective.  That’s because, typically, they are done that way.

However, I then asked:

"So do the sales reps of this partner call on the same kind of companies yours do?"

"Yes."

"What’s your primary vertical?"

"Marketing-driven entertainment and gaming industries."

"And they call on those as well?"

"Yes."

"Do they call on the same titles within those companies?"

"Yes.  Ah, so they’ll just be giving each other names.  It might not be a hot-lead."

"True.  But do your reps ask pertinent questions such as "Do they have budget?  What are they trying to accomplish now if they’re aren’t ready for the product you’re offering?"  Would the answers to those questions, if they were asked by your partner, but useful for your reps?"

"I get it.  They are a good partner!"

There are other ways to discover good partner fits as we’ve looked at it other posts and will continue to revisit.  The mindset should always be — whom can I exchange contacts, context, and connection with out in the field, sales rep to sales rep.  Don’t think product compliment!

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What does it take to fully build a company that successfully partners?

Committment from the Top Levels and Consistent Throughout

Commitment from the Top

Senior executives absolutely must believe there is value in enabling their partners to win, and in ensuring that partner deliver value.  They must also start to think of partnership as ways to execute in the field, not just PR or product offerings.  The committment must be stated and time and attention must be given, including to asking questions such as, "How healthy are the partnerships?  Are we allocating some resources to manage it down to the field?  What are the metrics — number of leads or conversations started and can we tie these to revenue?"

Some companies don’t have that top-level leadership.  They focus on either traditional lead-generation that works in isolated silos, or they see partnership at a level too strategic without drilling down into the metrics and execution.

It begins with a mindset, a way to start thinking of cultivating friendly "allies" who become feet on the street and seeing this as an essential way to win the war.

Consistent Throughout

Specifically, the field must have a way to experience consistent support and to be consistent in their efforts.  Revenue-generating alliances are not an instant panacea.  It takes cultivation to begin to see the fruit, and demands consistency of effort even without a ton of results right away.

That’s why it takes a delicate balance of consistency without time-consumption of the field-reps, but also strategic insight into which types of partnerships will yield some kind of fruit to keep them motivated.  It is an essential component of success.

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Once you begin to see the benefits, why is it that most companies either do not do it, or do it poorly?

A large part of it is that, particularly in the beginning, it takes time without immediate, apparent gain.  When you are dealing with a sales organization, no one wants to take that on.  It becomes hard to measure and even harder to see good results.

It is much easier to focus on activities which look like they are immediately building up a pipeline or growing an organization that most people can understand (a reseller channel, for example).

An Allyforce is difficult because it *appears* as if value isn’t being created right way.  *Traditionally* it has been hard to measure success.

This could potentially fall into a marketing category because it’s primary role is the identification of leads.  However, marketing typically doesn’t handle it because a good allyforce, by definition, works very closely with the field.  It involves management of field-level resources, and that is often not something that marketing owns.  They work within corporate.

Granted, these are generalizations and people may object to these, but it describes the primary underpinnings of why people are not effectively creating and building these allyforces from a resource-allocation perspective.  They don’t *perceive* a return and so do not fund a headcount to tackle it.

The reality is that, it often does not take on a full head-count, particularly once it is up and running.  So as a result, it gets tacked-on to someone else’s primary objective.  As an "add-on" it fails to get attention.

So the way to tackle it best is:

• create a way for just a temporary person to play the role and set it up — therefore not taking a full FTE
• enable easy management an on-going basis out to the field…
• but with ways for corporate to measure and manage
• create a way to scale it so the costs are lower since the benefits are longer-term

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Primarily Allyforce concepts emerged from my needs to manage a large territory of prospects and try to find where are the best opportunities quickly with few resources.  The hunt and peck approach to finding the appropriate person was too difficult for some of the reasons described earlier.

If you are in Large Account Management, this can be valuable if you have a cluster of other companies calling onto the same key accounts.  Why?  Because the points of entry into a large account or multiple.  And the politics are shifting. 

When you use an effective Allyforce of being able to share meaningful account contacts, context, and even in some cases connections with Large Accounts — think Global 50 — that becomes powerful.

Why?

One of the things people advise is to research a companies website, their annual report/10K, and news.  All that is absolutely valuable and should be done.  It’s table stakes to get into the game.

One principle I work off of us, if the information is publicly available to everybody else, including my competition, what is my advantage?  Yes, you can have better execution and better solution and, again, those are important.  But understanding the customer in ways that others do not is a very powerful differentiator.

This can be insight into a key problem, an initiative that isn’t made public, the political agendas of key personnel, insight into who is, in fact, the real personnel — all of these things typically cannot be easily found.

But your Allyforce may have bits and pieces of it.  Unlikely one person will know everything.

Think about your own experience working — especially breaking into — a large Global 50 or Fortune 50 account.  You could start at the very top and work with the administrative assistant of the CEO — which you should still do, although people are already doing that.  Or you could tap your collective Allyforce for the right pieces of nuggets and contacts, context, and connection.

They could have lost a deal, but gone through an extensive cycle.  They could be a prospect they’ve been trying to break into and could piggy-back or accelerate opportunities by partnering with you. 

The point is: even if you need to focus on a handful of companies, if the challenge is finding the right sets of people and getting insight and information not easily available, an Allyforce can work for you.

There are some minor adjustments in the way it is deployed, but the principles can remain the same.

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Alliances aren’t new.

People refer to them as strategic partners.

But this isn’t always the same as having "field focused" partners, and it primarily has to do with the intent and the goals of strategic alliances.

Some strategic alliances are PR alliances.  They are done to attract market attention, to demonstrate to customers and sometimes investors, that an alliance has been formed.  These can be a way to address something that has been brought up by analysts in the market, for example.  Sometimes these are done as a way to lay the groundwork for an acquisition.

Some alliances are corporate alliances in the sense that there is a complimentary relationship at a strategic level, such as market or product.  In this case, high-level conversations are set up to extend the value more than just for PR purposes but because, say, technology groups of both sides will work together.  Or product development and product marketing find ways to have a meaningful connection.

What is missing is how those translate directly into the "field" — which for companies that have a salesperson, whether it is the owner himself or an army of 200 inside and outside reps — is where the revenue is made.

Being able to execute down to the individual sales rep can have huge impacts on the bottom line, and often without significant costs.  The problem is typically in execution.

However, it is important for companies to ask themselves whether their alliances are "corporate" which clearly have strategic advantages when done in ways that meet stratetic goals, or whether they are "field" which deals with execution and, from my perspective, more directly with revenue.

There might be many who disagree and say that corporate alliances do, in fact, deal with revenue and have the facts and figures to back it up.  Which I think would be fine, it just hasn’t been my experience.

Simple ways to address it would be by answering:

• How many opportunities were created by a strategic partner?
• Which products were recommended?
• How many closed?
• How extensive was the involvement of the strategic partner, breaking down by region?
• How reciprocal is the relationship as a ratio of opportunities given and received?

One could argue that not all corporate allies can have these questions answered.  In which case, there is no field component to them. 

I would suggest on the flip side that there could be many field allies which haven’t had attention because there is no real "corporate" potential.  In other words, just because a company doesn’t appear to have strategic and corporate value does not mean that they could not be a fantastic and revenue-generating "field" ally.

What is a brief example of a field ally that is not a corporate ally?

Let’s imagine a company sells load-balancing hardware.  Their strategic partners might be the specialized manufacturer of the chip inside.  Or they could be the company the sells routers on the edge…hardware that is related to what they are selling.

But let’s say they mostly sell to companies running applications that need high up-time and good performance.  They could be a good "field" ally for a company which makes performance monitoring tools since both reps are going to be calling into the same title, types of companies, and have complimentary tools.  The corporate heads at both may see the relationship as too tactical to be "strategic," but for the field, they have the three ingredients which we’ll talk about to identify good allies: contacts, context, and connection.

Field alliances can be spun up much faster than a corporate alliance.  Field alliances can also be regional or maybe even vertical.  The advantage and difference is that because it doesn’t need to appease the larger forces, it can be ad-hoc with the primary purpose of driving revenue by putting more feet on the street.

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