Nine Principles for Creating Winning Partnerships

9 November 2004—European marketing leaders have identified the practice of marketing with partners as an increasingly important success factor. Creating winning partnerships, however, requires a deft balancing act between taking the time to agree on clear goals and metrics for specific opportunities while getting to market quickly enough to gain competitive advantage. Adding to the challenge, developing a systematic approach to partner relationships that work across all necessary departments and geographies can be complex, especially in regions such as Europe that incorporate multiple cultures and languages. Different partners often have different strengths and weaknesses compared to local leaders across the broad region.

There is no simple formula to help marketers build an effective partnership program. But ITSMA research with a range of technology and consulting companies suggests nine common principles for success.

Firms need to articulate a clear strategic context into which partnerships fit. It is difficult to assess how best to partner, and with which type of firms, absent a strategic view of business priorities, core competencies, market opportunities, and client needs—and how these might be changing.

3. Sharpen Partner Selection Criteria
Partnering strategy falls apart quickly without solid selection processes to make sure the right partners are selected. Important selection criteria include strategic fit, cultural fit, commitment to partnering, and potential risks. Selection guidelines are especially important when partner programs are meant to operate across multiple business units and geographies.

4. Invest in Relationship Development
Another common partnership failing is the lack of initial buy-in to common objectives, ways of working, and even terminology. In creating partnership agreements, it is vital to go through a relationship-building process that creates a common understanding of partnership goals and objectives. Face-to-face meetings and joint workshops are often the best way to address such questions as these: What does success look like for each partner? Do we mean the same thing when we talk about standards or use our internal taxonomies around services?

Beyond creating the initial common ground, partners need to invest time in developing effective joint planning, value propositions, roles and responsibilities, and agreed financials such as investment levels and revenue recognition principles.

Similarly, regular partnership reviews can provide an important vehicle for addressing the inevitability of change and ways to adapt (or end) partnerships accordingly. In fact, it is also wise to set up a kind of prenuptial agreement; in case the partnership is failing to deliver substantial value, there should be an agreed process for closing it down. Few companies include this type of agreement.

5. Ensure Internal Readiness
Successful partnerships typically require broad-based acceptance and commitment within both partner organizations. Along with initial efforts to build relationships and work through key issues, this suggests the importance of ongoing communication and robust information sharing about the goals, value, incentives, and progress of the partnership. Effective programs usually rely on a combination of face-to-face, email, and Web-based knowledge sharing and training.

More generally, the shift to issues-led, pull marketing campaigns within the technology industry is just as important in marketing with partners. Thought leadership initiatives with partners may be difficult to organize, but can also be that much more compelling by bringing together the expertise of two (or more) organizations. As an added advantage, issues-led campaigns can shift the focus away from brand- or product/service-led efforts, which often bog down in debate about which brand comes first.

Further, marketing should focus on designing the ideal customer and partner experience and then measuring delivery against that design. Blueprinting or service mapping is a useful tool at this stage because it highlights potential fail points in the process, including the handoffs between partners. Team building opportunities among delivery teams, partners, and clients can play a useful role at this stage, whether they are formal (e.g., planned hospitality events) or informal (e.g., spontaneous evenings out together). They help cement relationships and provide opportunities for more informal feedback than can be collected in customer surveys, particularly between partner staff and in situations where there are gray areas around ownership and responsibilities.

8. Measure and review results
As with all areas of marketing, effective partnership programs include a serious commitment to measurement and review. Most important is linking back to the partnership's initial objectives. Revenue is always important, but most programs include other objectives and it is useful to take a balanced scorecard-type approach to measurement. Win/loss analysis of particular deals with partners can also be extremely helpful in evaluating the overall effectiveness of individual partnerships.

9. Manage the partnership portfolio
Most companies are better at starting partnerships than closing them down. As a result, many partnerships exist on paper far longer than they do in reality, and well beyond the point at which they add value.

Taking a portfolio management approach is a useful way to tackle the issue of useless partnerships. Use the strategic context and partner strategy established early on as a backdrop for regular evaluations of current partners and arrangements.

It is useful to agree in the original contract how the partnership will be closed down if it no longer adds value to both partners, and to have a clear process to follow in this instance. In addition, dealing with this stage face to face rather than through correspondence—or worse, through lawyers—can help protect the companies’ reputations and goodwill into the future.

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As partnerships become increasingly central to success in technology-related services and solutions, marketers must invest more time, creativity, and resources into partnership programs. Crafting a more structured program based on strategic priorities is one important step; putting more energy into the quality of each partner relationship is another. Finally, of course, effective partnerships must be win-win.

--Bev Burgess, info@itsma.com

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ITSMA specializes in helping companies market and sell services and solutions more effectively. As a membership organization, we provide research, consulting, and training to the world's leading technology, communications, and professional services providers to generate increased demand, strengthen customer relationships, and improve brand differentiation. ITSMA is based near Boston, and has offices in London and Tokyo. Learn more at www.itsma.com.