Every business wants to accelerate their revenue. It is one of the most common business goals, and one of the hardest to reliably accomplish. Combining product advantage with go-to-market efficacy is the key to consistently achieving revenue acceleration.
You have a great product or solution but, in a market saturated with competition, it will not get you to your revenue goals without effective go-to-market plans. Setting up the right business plans for you and your partners is fundamental.
But how do you make business planning valuable for both you and your partners?
The best partner business plans are mutually beneficial, helping both you and your partners to grow faster than your organic growth paths. To make sure the plans you’re creating will deliver accelerated results, you’ll need to take a critical look at 6 areas of your business and find answers to the following questions:
- Partner Selection: Which partners will help me grow faster?
- Capacity Planning: Can I grow better through existing or new partners?
- Performance Measures: How can I confidently measure partner performance?
- Incentive Impact: Are my incentives rewarding or reflecting partner behavior?
- PAM/CDM Productivity: How can I drive more revenue, and higher partner satisfaction, with my field resources?
- Program Effectiveness: Do my programs make a difference with the right level of return?
Now that you have identified the necessary elements, it’s time to structure those them into an effective, adjustable plan. At The Spur Group, planning is a four-step process:
Assess > Learn > Plan > Document
First things first, you need to set you goals and select your growth partners. This will require you to assess and analyze your partners’ growth profile. Specifically, you need to look at the difference between their organic growth and the growth you need from them to reach your goals. This is what you are really trying to figure out with your plan – how can you get your partner’s managed growth up to a level that will reach or surpass your revenue goals?
Once you have your goals and growth partners set, you need to know the partners’ performance drivers and growth areas. You will learn this by pivoting on the business drivers. To do this, our channel experts at The Spur Group have developed a channel capacity plan framework that operates on the 4 C’s: contribution, capability, coverage and commitment.
- Contribution: how much revenue a partner is producing. Each partner’s yearly sales velocity (size, frequency & number of transactions) is a direct measure of their contribution.
- Capability: how knowledgeable a partner is in your company’s offerings. Partners lacking the right strategic product mix or skills to sell those products will be ineffective in the market.
- Coverage: how many partners in each segment you have in your ecosystem. A well-functioning partner ecosystem means you are focusing in the right market and have a good mix of partner types, number of partners in each segment and partner attributes, such as types of customers served, business models and solutions offered.
- Commitment: how reliable a partner is at selling your product vs the competition. Most partners work with multiple vendors, and their loyalty to your company is a key determinant in channel revenue.
For additional information on our Channel Capacity Planning framework, check out our white paper.
After you have determined your most valuable partners, you can finally set up your plan. In this step you will define business outcomes and secure partner commitment. A good business plan sets the right expectations by covering off on what the partner and vendor commit to across 4 major components:
Now that you have it in hand, it is critical to document your plan and both of your commitments correctly. This will involve sharing the plan and driving performance accountability. It is important to have the business plans collected in a manner that allows the partner, the partner’s account manager and whoever has corporate responsibility for the aggregate outcome number to review the plans and documents.
As you go through the planning and documentation process, leverage the opportunity to make sure you really know your partners and the gives and gets you are agreeing to.
First, use your partner business plan to develop profiles for your partners by collecting information that allows you to benchmark future performance. Then, make sure you have set up a timeframe with performance milestones, outcomes that focus on specific, measurable performance, and investments based on incenting and rewarding performance against commitments and completion criteria.
With your partner business plan set up and in full swing, make sure to track your performance against the 4 C’s in your QBRs. Whether under, at, or exceeding plan, determine if the plan needs to be adjusted, if goals need to be reset, or if investments need to be reallocated.
No matter how developed your channel partner ecosystem, creating robust partner business plans will guarantee go-to-market efficacy of your product, and thereby revenue acceleration. Assess and analyze your partners’ growth profiles so you can set your goals and select the right growth partners. Learn your partners’ performance drivers and growth areas by leveraging the 4 C’s channel capacity plan framework. Plan the business outcomes, actions, resources and investments needed to succeed. Document the plan with proper visibility, track performance and drive accountability.
If you would like to know more about our perspective on effective business planning at The Spur Group, check out our 3 part blog series: “A Tested Perspective on Successful Business Planning”.