Partnerships are immensely important in modern business. A partnership is any deal in which a business agrees to work alongside another.
Increasingly, partnerships are pursued with the aim of achieving true parity. Partners with true parity have equal input – creating what some people term a business ecosystem. Business ecosystems are mutually beneficial to all partners. As a partnership grows, the share of the market afforded to the group expands.
Partner relationship management is a broad term. It encompasses all of the methods and communication modes used to generate a beneficial relationship with a business partner or partners.
In this article, the most important aspects of partner relationship management in the modern day are briefly covered. Each of these subjects deserves an article in itself. So if you are interested in partner relationship management, it is worth doing some further reading on these subjects.
1. Partner Recruitment
The first step in any worthwhile partnership is the recruitment stage. Once a business identifies that it would benefit from entering into a partnership, it needs to actively seek out suitable collaborators.
In an ideal scenario, both (or all) members of a partnership ecosystem would be actively on the hunt for partners, find each other, and begin negotiations on an equal footing with similar aims. This is not always the case. Prospective partners often need to be lured into negotiations. This can be achieved by putting together a comprehensive set of reasons why two companies should join forces.
If the strategic leaders or shareholders of a company can clearly see the benefits of entering into a partnership, then they are likely to vote in favour of doing so. Shareholders may purchase either voting or non-voting stock. Directors almost always have to vote on whether a partnership goes ahead or not. They look at factors that influence whether a company will benefit from a partnership before making their minds up.
2. Partner Onboarding
Partner onboarding is the process of integrating the training of your business and your partner’s business with the aim of building joint standards that enable partners to sell or develop products effectively. Partner onboarding needs to impact every level of a partner business – from the strategic decision-makers to the entry-level sales and marketing partners.
In the long run, good partner onboarding reduces costs and increases efficiency. Onboarding processes can include training on technology platforms, sales and marketing briefs, and just about any other information exchange that it is possible to think of.
The more work both companies put into onboarding during the preliminary phases of a partnership, the more money they are likely to make through their collaboration in the long run.
3. Joint Strategic Planning
Truly integrated peer-level partner businesses need to be able to conduct joint strategic planning. In traditional reselling partnerships, joint strategic planning typically involves the exchange of information on product sales and performance.
In more even co-selling relationships, joint planning usually involves long-term analysis and forecasting of markets. This information is then collaboratively assessed in order to generate sound business plans that mutually benefit both partners and bring the entire ‘partner ecosystem’ revenue.
Check out Workspan’s PRM system for some tips on how to cultivate an efficient and mutually beneficial joint planning structure.
4. Joint Training
As well as the training that takes place during the onboarding process, a program of joint training must be developed so as to be continuous.
There are myriad reasons for the effective nature of business training partnerships. Continuous joint training initiatives allow for the exchange of specializations in an effective manner. They keep parity in terms of capability between partners.
They allow experiences in different markets to be bought to bear when increasing the capabilities of both companies involved in the partnership.
5. Lead Distribution And Management
Partner relationship management involves the fair distribution of leads and their associated benefits. Distributing and managing your sales leads to partners relies upon your partner being effectively trained and have gone through the onboarding process.
If they are up to speed with how your business operates, then you should be able to treat members of their sales team as if they were members of your own.
Modern lead management is highly automated. Partner businesses automatically receive leads even if they are sent to their fellow company’s sales team. This kind of automated lead distribution can effectively double the size of a company’s sales force by integrating partner assets.
Automated lead distribution has to be done intelligently – sending leads to specialists immediately instead of necessitating a long-winded series of phone calls to get them to the right person.
6. Deal Management
Good deal management is all about fostering a good relationship with your partners from the outset of your involvement. During the recruitment phase, a business will need to negotiate a deal that is eminently unanimous. The more mutually beneficial a deal is from the beginning, the easier long-term deal management will be.
Deal management is any strategy or tool that gives a company the ability to define and maintain deal parameters. Any sales team will be very aware of the importance of deal management. As a partner, you will have to become a deal manager away from sales.
Deal management in sales is also something that needs to be shared during a partnership that has parity. As part of the onboarding and training process, deal management protocols need to be negotiated that cover the entire partnership.
Due to a partnership typically being relatively obvious to consumers and collaborators, the deal management tactics used by a partner company need to be the same as those used by a partner. This is to avoid the tarnishing of reputation that can be caused by institutional inconsistency.
7. Marketing Development Funds Management
Companies typically distribute funds to their partners for the purpose of marketing developments. In recent years, companies have expected more from their partners in terms of traceable benefits and returns.
Companies naturally always expect data to be sent back from their partners. Every dollar must be accounted for. How, then, do partners account for the gains they have made using the money sent to them? The answer lies in data analysis.
If the data scientists working for a company don’t see a hint of return growth as the result of an investment, the company usually cans its investment. Events, for instance, are coming under increasing scrutiny from companies that had previously provided events funding as part of their marketing budget.
One issue with this new, highly scrutinous system of fund allocation is that it damages the assumed power parity between partners. With increased funding scrutiny, marketing and sales partners have less power, as a huge amount of power is retained in the hands of the producers and vendors.
When vendors create software and data collection methods in order to constantly assess the effectiveness of their marketing spend, they can often take power away from their partners.
8. Partner Performance Management
While partnerships should be conducted on an equal footing, there is still the need for partner performance assessment from both or all of the parties involved. In order to assess a partner’s performance, a company has to decide on which factors need to be measured.
The simplest factor of all is profit: has the partner achieved the desired growth? Training and onboarding success can also be measured.
Rigorous performance assessments need to be carried out in a transparent and institutionally responsible fashion. Assessments should be part of a business’s remuneration program. A good remuneration model usually falls between the two extremes: one-sided resource pumping and extreme parity. No partnership is completely equal, and expecting this can doom a partnership from the start.
9. Communication And Collaboration
All partnerships are based on communication and collaboration. Clear channels of communication are essential during any partnership.
Technology is aiding the creation of clear communication channels. Project management software is immensely popular with companies for collaborative project completion purposes, but it also has great secondary use as a communicative tool when working with partners.
Project management tools allow disparate members of disparate teams to share calendars, view progress, edit documents, and communicate aims.
Over-communication is better than under-communication in the realm of a business partnership. Keeping partners in the loop – no matter how small your business’s progress – helps to prevent data silos and duplicate work. Data silos and duplicate work are two of the most notorious scourges of business partners attempting to interact and promote growth efficiently.
10. Software Integration
Businesses typically work using specialist software. Specialist software is crucial in just about every field of business, and software developers spend a great deal of money marketing their services to individual businesses.
When one business partners with another, they may find that they are using software developed by completely different companies. This makes software integration relatively hard. Fortunately, a new generation of APIs makes software integration much easier. APIs – standing for Application Programming Interfaces – allow computer programs to ‘use’ each other as if they were humans using an interface.
This enables swift and efficient software integration between companies using dissimilar systems.
Disclaimer. The views and opinions expressed here are those of the authors. They do not purport to reflect the opinions or views of IdeasPlusBusiness.com.
Any content provided by our bloggers or authors is of their opinion and is not intended to malign any organization, company, individual, or anyone or anything.
For questions and inquiries on the blog, please send an email to the Editor at ideasplusbusiness[at]gmail[dot]com. You can also follow IdeasPlusBusiness.com on Twitter here and like our page on Facebook here.
This website contains affiliate links to some products and services. We may receive a commission for purchases made through these links at no extra cost to you.
I am Adeyemi Adetilewa, a media consultant, entrepreneur, husband, and father. Founder and Editor-In-Chief of Ideas Plus Business Magazine, online business resources for entrepreneurs. I help brands share unique and impactful stories through the use of public relations, advertising, and online marketing. My work has been featured on the Huffington Post, Thrive Global, Addicted2Success, Hackernoon, The Good Men Project, and other publications.