Partnering

for growth

A guide to success

Discover how your business could benefit from a partner-to-partner relationship. Find

out all you need to know about making your partnership a success, from defining

commercials to organising lead sharing.

1. Why partnering matters 3

2. How to build a business case for partnering 5

3. Top 5 criteria for partner selection 7

4. Collaborative planning: 5 ways to plan partnering projects 9

5. Speak now or forever hold your peace: defining commercials 11

6. Put it in writing: how to set up a formal agreement 13

7. CSP and ISV sitting in a tree, K.I.S.S.I.N.G. 15

8. How to share lead information in a P2P relationship 17

9. Captain of the ship: agreeing customer protocol 19

10. Reviewing your business together 21

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1. Why partnering matters

With the introduction of cloud technologies and extension into the world of cloud

services, we know that many of our more traditional technology partners have had to

radically alter their business models. Products and services like the cloud have

become increasingly commoditised, making it difficult to differentiate offerings and

attract new customers.

Where there is change, however, there is opportunity.

Standing out from the crowd

Many have responded to the challenge of a changing marketplace by creating a

compelling story that resonates well with customers. They’ve done this by following

one of two approaches:

Offering distinct intellectual property, for example through specialist software

Offering expert consultancy, focused on business growth and support

While both approaches offer real value to potential customers, where resources can

be limited, it’s not always possible to focus in both directions at once. To offer great

support and accurate, helpful advice, it takes time - and often investment - to build

the specialist expertise to support the broad spectrum of topics customers often

demand.

Partnering with another specialist organisation (or even a number of them) can often

help resolve this problem by allowing you to offer customers the benefit of both

approaches, without compromising the value and individuality of your own offering.

Spotting the opportunities

Partnering can come in all shapes and sizes from supporting the needs of a single

customer, to the notion of sharing multiple leads and opportunities.

To understand how this approach could benefit your business, it’s worth starting by

looking at your greatest untapped opportunities. For example:

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Short on specialist skills? You could work with another partner to buy in

their highly technical skills for a specific customer scenario and use this as a

learning opportunity. Or you might expand your offering to include those

partner skills on a permanent basis. An independent software vendor (ISV), for

example, might partner with an integration specialist to provide an end-to-

end solution including migration from another platform.

Need capacity? By partnering with a similar business to your own you might

subcontract work to each other to support seasonal or other capacity issues.

Struggling to access a particular audience? You might have a great product

or solution, but insufficient infrastructure, skills or connections with customers

to make the most of the opportunity. Partnering with an organisation that has

scale and already has more relevance for specific customers by offering niche

applications, services and value-added IP could provide a perfect pairing.

Lacking “inside” knowledge? You could connect with a partner that works in

a particular industry or market, who can provide additional insight, creativity

and opportunities. Or as a specialist in a particular market yourself, you might

partner with multiple ISVs to offer a targeted and unique range of services

and solutions.

The key to getting the most out of a partnering relationship is to make sure you’re

both getting value from it. Partner-to-partner collaboration isn’t about exploiting

someone else’s skill. It’s about working together to deliver a better outcome for both

your customer bases.

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2. How to build a business case for

partnering

Partner-to-partner relationships can unlock a great deal of potential in your business.

That said, unless your whole team enters into this with a clear idea of what you are

doing together, and why, you’re unlikely to reap those benefits.

So here are three effective business considerations to get everyone on board:

1. Do what you do best and find the best people to do the rest

There are always products or services that would complement your existing offering,

but as a small business perhaps you just don’t have the capacity or expertise to

deliver them.

By partnering with a business that does offer them, your customers benefit from a

more complete answer to their problems. And with a more complete offering, you

have a significant advantage over competitors.

2. Open up new opportunities

If your new partner’s marketing targets a different kind of audience to your own,

you’ll gain access to a completely new market. This might be a new industry, a new

geography or a new network. And with a new audience comes new insight into

customer pain points.

You’ll also get access to new expertise and ideas, meaning you can stop re-inventing

the wheel and focus investments on genuine innovation.

3. Boost growth and success

‘VAPs [Value adding partnerships] have the best of both worlds: the coordination and

scale associated with large companies and the flexibility, creativity, and low overhead

usually found in small companies... In an increasing number of industries, they are

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proving to be fiercely competitive against both large companies and small

independents.’ – Harvard Business Review

It’s safe to assume that if you improve your offering and invest in new technologies

and services, then your customers will be happier. And happier customers are more

likely to:

Stick with you, increasing the average lifetime value of your customer base.

Trust you and listen when you suggest an upgrade or a change, making

upselling and cross selling easier.

Become evangelists for your business, effectively providing you with free

marketing.

All in all, partner-to-partner relationships are a sure-fire recipe for increased sales,

business growth and success.

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3. Top 5 criteria for partner

selection

Finding the right partner to collaborate with doesn’t happen by chance. A selection

process will help ensure you feel confident in your choice.

The best place to start is to identify what criteria you’re looking for.

1. Culture fit

As with hiring a new member of staff or finding a suitable supplier, culture fit is

crucial. A partner may tick every other box in terms of suitability but if the two

cultures don’t mix you’ll face a constant uphill struggle.

If possible, get a face-to-face meeting with your prospective partner to see if you

share the same approach to business.

2. Complementary service

The aim of collaborating with other Microsoft Partners is to provide customers with a

well-suited set of services. Naturally, to do this you will want to find a partner whose

specialty complements your own.

For example, if your expertise lies in SharePoint, you might want to work with a

partner that specialises in Office 365 deployment so you can collectively roll out the

full package to customers.

3. Reach

As well as pooling your resources for the benefit of the customer, a key reason for

working with fellow partners is to reach new audiences. If your prospective partner

doesn’t have a clean contact database or access to new networks, they’re unlikely to

be able to share any valuable customer insight.

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4. Customer references

When you work with a partner, their behaviour towards clients reflects back on you.

Find out what your prospective partner’s existing or previous clients have to say

about their approach to work, availability to help and commitment to relationship

building.

5. Skillset

You need to look beyond technical skills in a potential partner. Ideally, you want to

work with someone who knows how to sell their service, and by extension your

services, to the customer effectively. Their ability to deal with change management,

customer service enquiries and technical support are also worth noting.

Find your match

Remember: when you work with another partner their actions become an extension

of your business (and vice versa). It’s therefore crucial you pick the right partner for

both your business and your clients. It won’t always be a quick process, but when you

find that perfect partner, it will all be worth it.

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4. Collaborative planning: 5 ways

to plan partnering projects

Writing and agreeing a plan together

It’s exciting isn’t it? Getting a project up and running. But don’t run before you can

walk, you need a plan. Project partners must know what to expect from each other.

When planning, consider using a framework to give your project the best chance for

success.

1. Build a shared vision

It’s essential to agree on a partnering vision at the start. A shared vision makes both

parties’ expectations and objectives clear and helps you avoid unpleasant surprises.

Mutual understanding of your individual businesses and motivations at the outset

will help ensure that you have a common reference point to help keep your

relationship on track.

2. Understand expectations

Organisations partner up for many reasons. But, if they don’t express them clearly,

those expectations may not be met, leading to resentment. Make sure both partners’

expectations are clear from the start. Make your plan adaptable so you can address

changes in expectations as they arise.

3. Set goals and agree accountability

Agree on goals that align with the partnering objective. Once agreed, define what

each partner will do. Put this commitment in writing. Have a common objective and

hold each other accountable. It’s worth it.

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4. Identify the strengths of each partner

A simple fact of life is that some people are better at certain things than others. It’s

easy to identify obvious skills but you need to dig deep. What underlying strengths

do you both have? Finding this out can make a big difference to long-term success.

5. Handling disagreements

People argue. It’s important to agree ways to resolve any issue in advance. Have

regular meetings to discuss disappointments, frustrations and challenges. Stay

positive and ask what you both want going forward? Make a plan that gets everyone

smiling and give them something to look forward to.

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5. Speak now or forever hold your

peace: defining commercials

It’s all well and good finding a partner that complements your skillset, gels with your

company culture and offers comparable customer service, but it means nothing if you

can’t sit down, speak honestly and define the commercial aspects of your partnering.

Sketch out the big picture

First of all, decide how formal this relationship will be. Are you going to start out with

a well-defined, small-scale project to test the waters? Or do you want to scope out

the full arrangement up front and decide a minimum viable term?

Whatever shape your initial agreement takes, define the broad principles and roles

up front. For example:

Is one of you better at ‘big ideas’ and innovation? Is one of you more suited

to the details of execution?

Who’s going to select teams and co-ordinate projects where required?

How much can each of you commit in terms of resources and time?

Who’s responsible for customer service and invoicing?

As Julie Rice, co-founder of SoulCycle, says:

“When you’re honest about your strengths and weaknesses, and accept

your role in the organization, there’s no toe-stepping, no ego issues and

things run much more efficiently.”

Don’t avoid the difficult details

Once you have the big picture sketched out, fill in some detail. Whether you enshrine

them in a contract or sum them up in an email, you must agree on certain specifics

before you work with your first joint client:

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How will you share promotional and other costs?

How will you record, define and share leads, contacts and sales?

How are you going to split revenue, profit and loss? On what basis?

What happens if things go wrong? And how much notice must you give if you

want to end the relationship?

How will you handle legal matters such as IP ownership, confidentiality and

managing liability?

You might feel apprehensive talking about such thorny topics, but remember it’s

much easier to address them now, before you (or your partner) have anything to lose.

Plus, agreeing these points will make your relationship more productive and much

happier in the long term.

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6. Put it in writing: how to set up a

formal agreement

Negotiation is a part of everyday life, and an unavoidable part of doing business if

you’re looking to build new partnering arrangements and expand.

No two negotiations are alike, but whatever win-win looks like to you, one thing stays

the same: you need to get the outcome in writing.

Why? It’s simple: for a business relationship to be successful, you need to know what

you’re giving and what you’re getting in return. This is important for transparency

and accountability.

A little give and take

We’ve already covered what commercials you need to define when you enter this

kind of arrangement, such as objectives, financial contributions, liability and so on.

But when it comes to formal agreements, how do you make sure you’re agreeing on

the right terms for your business?

Preparation makes whole process easier. Before you step into negotiations, you

should:

Know what you want. Define your most-favoured position (MFP), which is

your ideal outcome. Then consider what your fall-back position will be; this is

the minimum outcome that you can accept. Don’t settle for less.

Be patient and prepare for failure. You need to have a plan in case

negotiations break down. This is called a best alternative to a negotiated

agreement, or BATNA. An example of this would be agreeing to complete the

project in hand but not continue the arrangement any further.

Why negotiate at all?

Most people get very anxious about negotiating, but productive negotiations help to

build better business relationships. And better relationships can boost revenue and

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profitability. In today’s world, partnerships are the new means of expansion; Peter

Bendor-Samuel of CIO explains:

“The digital world and as-a-service model moved the... IT environment

from a mode of do-it-yourself and managing some vendors to, instead,

an ecosystem of committed partners.”

Working with another partner will give you access to a bigger slice of the 71 percent

of IT departments that spend half of their budgets on external providers.

But partnering with others mean negotiations, and negotiations means formal

agreements. Don’t settle for a handshake or verbal contract: aim to walk out of the

room with clear statements of intent, boundary roles, statement of works –

everything that captures the nature of your relationship. And then get everyone to

commit to it.

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7. CSP and ISV sitting in a tree,

K.I.S.S.I.N.G.

There used to be a time when the IT team alone took decision on IT investments,

projects and resourcing. But times have changed. Information technology is now

viewed as a strategic business partner, integral in the development of new tech-

driven products with a faster time-to-market. At the same time, the “business

decision maker” can have a significant influence on purchase decisions.

Relationships between cloud service providers (CSPs) and independent software

vendors (ISVs) are becoming ever more critical; CSPs providing the opportunity to

create packaged offerings that include both niche applications alongside more

traditional Microsoft technologies such as Office365 for example.

If an “Indirect” Cloud Service Provider already has relationships with a channel of

resellers who are connecting into multiple customers, there’s an obvious opportunity

for Independent Software Vendors (with great, relevant and specialist applications) to

work with the CSP to offer a joint packaged offering that could potentially reach a

much wider set of customers than the ISV might find alone.

What to ask before making it official

Do your due diligence before partnering up. An ISV looking to partner with a

potential CSP should always ask:

What support service do they offer?

What is their go-to-market strategy? Do they have a healthy ecosystem of

sales partners and resellers?

What is their average yield from this network of sales partners and resellers?

What is their main workload? Office365, Azure, CRMOL?

An ISV will be looking to build confidence that an indirect CSP has the right strategy

and infrastructure to support their future consumption and delivery demands. And

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will want to be sure that a relationship would give you access to resellers with the

right target customers.

Of course, the deal goes both ways: an ISV will also need to be able to articulate:

Product offering and value propositions. What customer problem(s) does

the application solve?

Target market. Identify the target market and know why – and how – best to

target them.

Ideal customer. If targeting a B2B market, consider how many employees the

ideal customer would have. What industry are they in? Who are their

customers, and what are their needs?

Internal structure. Be up front about your sales and marketing resources to

help align your sales process with your CSP.

Specialist sales requirements. If selling via another partner, are there specific

pre-requisites that need to be in place?

Billing method and price. It sounds obvious, but it’s important to think these

things through and ensure that it’s easy to transact business between the two

organisations.

Better together

CSPs and ISVs are definitely better together – the trick is to find the right partner, and

ask the right questions.

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8. How to share lead information in

a P2P relationship

In a partner-to-partner relationship, collaboration is the only route to success. To

create a fruitful arrangement, your business needs a solid, established process for

sharing and following up on leads.

The ground rules

Before you begin sharing information, it’s important to set expectations:

Quality. What does a good lead look like? What criteria will define a

marketing or sales qualified lead? What information needs to be shared?

Sharing timeframe. How quickly should you share lead information?

Response timeframe. What should the other party do with that information?

For example, should they offer a consultation, close a deal or supply goods?

How long should they take to complete that goal?

The complete lead-sharing template

Use the lead-sharing template to standardise how you share leads in your

partnership.

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The next step: automation

As long as both you and your partner are using a CRM (customer relationship

management) system, you can make the process even simpler by automating it.

Tools such as Zapier integrate with CRM tools such as Microsoft Dynamics CRM

Online and remove the last obstacle in the way of your lead-sharing process: lack of

time. Set up a trigger, indicating it’s time to share the lead, outline the information to

share, select how to share it with your partner, and let the tools do the rest.

What’s the point?

If that all seems like too much effort for what should be a simple process, consider

this: if you set up a seamless system and send your partner high quality leads on a

regular basis, they will reciprocate.

Businesses thrive when they make the most of the resources at hand. Organised

smoothly, partner-to-partner lead sharing is a resource with real revenue-driving

potential.

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9. Captain of the ship: agreeing

customer protocol

A ship can’t have two captains because no one would know which orders to follow.

The same applies to partner collaborations.

When two partners come together there are two clear options: either you take the

helm or you let the other partner steer. The question is, how do you put your ego

aside and determine who should take charge? Start by asking yourself these

questions:

Who has the experience?

Whether it’s extensive or not, it’s likely one of you will have more experience in

leading successful projects than the other. Experience is a valuable asset and one that

should factor highly into the decision on who to pick as captain.

Who has the internal resources?

Being the lead partner doesn’t just mean rattling out orders. It means taking charge

of all communication, ensuring that the client’s needs are met, organising status

meetings and co-ordinating between both businesses. Ask yourself: do I honestly

have the internal resources to take this on?

Who owns the client relationship?

Though you might see yourselves as two distinct partners, the client will see you as

one business providing them with an all-round solution. They don’t want to talk to a

different person every time they have a question or an issue. They want consistency

and familiarity. If one partner has a better relationship with the client, let them steer

the ship.

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How much control do we want?

Be honest with yourself – how much responsibility do you want to take on? Do you

want to be the face of the relationship and the first point of call for client queries? If

you do, then step up and take the lead.

If you don’t, that’s an equally viable choice. Some businesses prefer to avoid the

spotlight and focus on product development or the nitty-gritty of service delivery

instead.

Smooth sailing

Play to your strengths and recognise there is just as much value in being first mate as

captain. When everyone knows their role, communication channels open up.

Employees and customers have a clear idea of whom they should contact for what

reason and people know who they can turn to with a problem.

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10. Reviewing your business

together

You’ve set up your relationship and been working together for a while, but how is it

really going? Reviewing your performance is a vital part of any collaboration and

something you should do together regularly.

If your relationship was created with specific goals, expectations and results in mind,

this is an easy task that will strengthen your relationship. Think about the following

questions and decide if, and how, you can improve your collaboration.

Do you work well together?

At the most basic level, you need to question whether you and your partner are

working together effectively.

Ensure that you’re still both on good terms, communicate regularly and have the

same end goal in mind. In order to work well together, there needs to be respect and

an element of transparency.

Are you achieving your targets?

Sit down, look through your results and ask yourself these questions:

Is the quality and quantity of sales qualified leads coming through what you

both expected?

How many deals have you won?

Have you reached your revenue goal?

How does your performance compare to your target?

If you haven’t met your targets, discuss why and the ways in which you can improve

your results next time. Perhaps you need to establish priorities or set smarter,

attainable goals.

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Are your customers happy?

Analyse your customer success stories and complaints to pinpoint what you and your

partner are doing wrong (or right). Discuss how you could improve customer

satisfaction in future.

What does your future entail?

What’s in the pipeline? Have you and your partner clearly set out priorities,

expectations and target results for the next month or quarter? It’s good to use past

experience to prepare for the future. Create a plan and discuss any opportunities or

challenges that may arise based on your performance so far.

If you’re both on the same page and still feel happy in your relationship, you really

can’t go wrong. Just be sure to communicate regularly and review your business

together often.