Prioritizing Strategic Partnerships will transform your partner business, accelerate your revenue contribution to the company, and elevate your partnerships organization. In this article we will show you how to identify a strategic partnership, prioritize it, and generate more revenue.
The biggest challenge Partnership leaders experience today is demonstrating how they drive value and impact the business. But it’s Catch-22: business impact is required to unlock resources, and without more resources you can’t generate more value.
One way to solve this problem might be by prioritizing internal stakeholders, engagement, and education. This translates into training Sales on why partners are important, establishing KPIs with Marketing, integration strategy with Product etc. It might look good at first, but can very quickly turn into a death spiral.
Instead, focus on Strategic Partnerships. Your team should be spending, at least, 80% of their time externally with strategic partners that create value for the company. You can spend the remainder 20% internally celebrating wins and optimizing processes. You are also going to be busy deploying the resources that teams are now throwing at you to get a piece of the huge amounts of value you’re bringing.
Stop wasting time telling others how valuable partnerships are for the company. Prioritize your strategic partnerships and do the work. The value that you bring will speak for yourself.
What is a Strategic Partnership?
The definition of a Strategic Partner may vary by company, but it is almost always tied to how much revenue they can generate. If your company is generating less than $500M in revenue annually, the reason the C-Suite approved a partnership team is because they believed it would bring additional revenue.
If you’re not sure, try this. Send your CEO the following Slack message:
“I’m reprioritizing our partners and want to confirm that we should be focussing on adding revenue as our top priority. Does that sound right?”
You will likely get a big ‘DUH!’ back.
Another common misconception is that strategic partners have to be big, slow-moving, and resource intensive. Let’s change that. Your most strategic partners will be agile, motivated, and investing resources in making it easy to partner with them. Why? Because you will be a strategic partner for them as well.
Partners are strategic if they do the following and in this order:
1- Generate or protect significant revenue.
‘Significant’ revenue for your total partner contribution to your company could be >20% of new business coming from Partners; your most strategic partners will likely generate >80% of that.
2- Solve big problems.
Strategic partners will unlock customers, reduce competitive threats, and open new markets.
3- The C-suite is onboard.
Not only will they support this partnership, but they probably already started to work on it before you joined the company. Your CEO should know who your most strategic partners are and they might even be in touch with them. Get a ‘no-brainer’ response to your strategic partner list.
3 Steps to build a Strategic Partnership
1-Identify: There are a couple of indicators that could tell you that a partner might have the potential to be strategic:
- Customers: They have customers who can generate significant revenue. Also, they could have a large existing customer base, new customer acquisition volume, or very large customer contracts.
- Organic relationships: Strategic partners are probably already known by your team; you won’t need to force that partnership or overthink it. They are probably the big company in the market, someone that you are already integrating a lot or that integration that your customers are asking for. In this case, the most obvious answer, is usually the correct one.
2- Prioritize: The 80/20 rule is king. Devote 80% of your time to the most strategic partners. Those relationships will be the ones that generate the most revenue and have a bigger impact on your business. If you are short-staffed and can’t even handle more than one, then go for the biggest one.
3- Evolve: As time passes, a strategic partnership might evolve. It’s important to keep track of them and review the results, either quarterly or yearly. You should ask yourself:
- Is this Partner still strategic?
- Do we need to evolve or update our relationship?
- Are there new partnerships that we should be prioritizing instead of this one?
In conclusion, Strategic Partners are the first step to a successful Partnerships strategy. Either if you just stepped into a new role or have been working on your program for a long time, they should always be the first item of business. Building and nurturing a Strategic Partnership will always be the best way to drive revenue and get internal support.
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