Whether it’s for cloud products that already exist or planning for a future cloud strategy, you need a partner ecosystem to help drive your business. A cloud go-to-market strategy is vastly different than an on-premises strategy though, so building the ecosystem will require a different approach to partner recruitment and partner enablement than you may have used in the past.
To create a balanced ecosystem, follow these seven steps to be successful in a cloud-first, mobile-first world.
Define cloud strategy
Like any good business goal, your cloud aspirations need to be backed by a clear strategy. At a base level, you’re likely looking for market share, revenue acceleration, or business transformation. The question is, how is cloud specifically helping to achieve these goals. Trying to build a successful cloud-partner ecosystem without defining company objectives will be nearly impossible. Avoid the headache later and establish these first.
Determine partner role
Too often, we see companies make the mistake of utilizing cloud partners the same way they utilize their on-premises partners. They assume that partners are happy to sell the product without changing how partners monetize the product. When it comes to partner role, you have several options:
Simple resell with referral fee
Sell-thru, where your partners own relationships and billing
Sell & Services, where services are the real opportunities for partners
Upsell, the “would you like fries with that” model. Network equipment is a great example, where adding a subscription service can grow the sale.
Before you get partners involved, it’s imperative that you know what you want your partners to do. Once that’s done, make sure you tell your partners.
Assess ecosystem and identify best candidates
Once you determine the role of the partner, you need to determine how many existing partners, if any, can help with your cloud initiatives. To best identify the most valuable partners in your cloud ecosystem, we recommend scoring them using our PERC method as well as following the 5Cs of Capacity Planning.
When working in the cloud space, you want to look at the 4Cs from a slightly different perspective.
Look for capabilities that match the role you want your partners to play
Find coverage in markets that you’re specifically looking to grow early on
Manage commitment less than usual as this is a new opportunity
Prioritize high reach partner contribution, not high yield. Cloud is a scale business which means it’s more about market share and adoption rather than a singular, large sale.
In most cases, only a few partners will actually transition with you. But it’s important to identify these few so you can gain momentum.
The analysis investment you do here will pay for itself in the future. Developing a standard methodology and scalable reporting engine will allow you to make ecosystem adjustments as you grow.
Develop a cloud program
When you’re starting to develop your program you'll want to keep in mind 4 partner enablement and management best practices:
Training – Your technical and sales personnel must be equipped properly in order to perform at their highest ability. While partners may continue to play a technical integration role, because they no longer have full control over the hardware, how they solve problems often changes. Sellers also need to learn to have conversations around customers’ concerns about cloud.
Monetization and Contra Funds – Partners need to have thresholds to meet. These thresholds can act as accelerators for benefits and incentives. And when choosing the right thresholds for partners, remember, it’s about scale and momentum, not just the size of the deal.
Incentives – You’re looking to drive the right behaviors from your partners. New behaviors require new motivation. It’s important to decide if you want customer acquisition (breadth), cloud consumption (depth), market penetration (mind share), or something else
Benefits – To keep partners engaged overtime, you want to make sure you have the right benefits
Pilot your program
This is all about testing and refining your program. Before you officially launch your program, you want to know a couple of specific things:
Determine the biggest challenges to your partners – mitigating these prior to the launch will help build trust and loyalty with partners overtime.
Identify field support challenges – ensuring that your field can efficiently and effectively sell your cloud solution is required to build momentum and scale.
Recognize best practices – these will bolster your program if these are maintained throughout growth.
Develop a cloud partner profile – what are the attributes that indicate a high potential for success
The information you gain here will help generate greater momentum when you officially launch.
Launch your program
Making a cloud transformation is not easy for vendors or partners. Understandably, there is often a great deal of anxiety associated with this change. It represents a fundamental shift in how a business operates. In some cases, businesses may even see a dip in revenue before they see any growth. To help mitigate this risk, think of the following three things as you launch:
Change management – how will you help your partners and internal teams focused on success and supportive of the efforts?
Broad communications – closely related to change management, it’s essential that there is clear and transparent communication about the opportunity and roadmap
Readiness - both partners and your field will need to change how they think and the motions they go through to drive revenue. You want to be sure people are trained on new systems, policies, and products and your program is launched
Assist your partner
As your program matures, continue to refine your partner program optimization on a regular basis. Using partner analytics will help identify up-and-comers in your program as well as any gaps in strategy. And as your ecosystem develops, the needs of your company and your partners will too. Keeping your incentives and trainings up-to-date is key to meet the demands of your growing cloud partner program.
Strong product advantages don’t carry companies anymore. Their go-to-market strategies do. And part of that strategy has to include a cloud partner ecosystem in order to be successful and gain market share.
Luke is a leader in our channel management and business intelligence practices. With over 10 years of industry experience he brings a background in customer service and a passion for data based decision making to collaboratively solve client challenges.