Hfreeman Technology Alliances  

Alliance Development Lessons

"Partner Type" has two very different meanings.
Partner Type (1) refers to the type of company your partner considers itself to be. Examples are software vendors, resellers, systems integrators, distributors, and system builders. Marketing collateral and web content should be addressed to partners based on this typology.

Partner Type (2) refers to the type of business relationship a partner will have with your company. To avoid confusion, we call this set of types "roles." Contract language and program operations are built around these roles.

Partners may take on more than one role, such as when an ISV also provides integration services or a system builder installs and resells your application. For instance, an ISV that could embed your software deep inside its own product (and pay you royalties) would have an "OEM" relationship with you (partner type 2,) but it is in the software vendor business (partner type 1.)

When asked to develop our client's partner agreements we start with a custom partner agreement framework. This consists of a basic partner agreement that all partners sign and multiple role-specific terms and conditions (as exhibits to the base agreement) for each of the roles that a partner chooses to assume. This makes things simple when, for instance, an ISV also wants to be a reseller or integrator. (We create the basic agreement by combining our partner-oriented text with the legal terms your attorneys have already approved in your standard software license.)
Beware of Advanced Technology departments of large systems integrators. If you pester the big integrators long enough someone from these departments will take a meeting with you and show interest in your software. Often, they will keep taking meetings with you as long as you'll meet with them, since meeting with you counts towards their MBO objectives. You may start believing they are going to recommend your technology to their vast field organization, who will go pitch it to their customers. This is not likely to happen.

The main-stream, customer-facing people at the integrator don't need or want more software; they want new projects they can bill for. The way to get real, business-producing attention from a large integrator is to bring them a new opportunity in which the customer is already predisposed to using your technology.

We generally recommend delaying an approach to  the largest integrators until a company has substantial enterprise customers it can introduce integrators to. For startups, a better use of  resources saved  into evangelizing the analyst and influencer community. Ultimately, it is their blessing that will get both enterprises and major systems integrators to take you seriously.

When potential partners inquire about your partner program, they are hoping to use it to get new customers. You probably launched you partner program hoping to get new customers for what you sell.

We know of situations where  potential partnerships went through several meetings and contract term negotiations before discovering that neither had customers and each thought the other did.  We recommend you avoid this experience.

Large systems integrators can waste your time
Be clear about which partner is bringing the customers
Leverage your platform partner
The software you sell depends on an underlying platform's API, and the provider of that platform (Microsoft, Sun, IBM, etc) offers many programs and events you can take advantage of. We strongly urge our clients to participate in all of them. When you do get that big chance to speak to a high level person at your platform provider, the first questions their executive will ask are "Are in my X, Y, and Z programs?" and "Did you buy space at recent show."

If you have already signed up for and taking advantage of those  programs you have a chance of asking for something special you want and getting an introduction to someone who can help you. But if your company is not already a member all that happens is  you leave the meeting with an action item to "look into the benefits of the program."

Also, when you go to your platform partner's events (M/S PDC or Partner World, Java One, Linix World, Oracle World, etc.) do not evaluate its benefits to you solely on the basis of sales leads. Showing up and supporting the event is also about relationship-building with the platform partner. Creating that relationship takes time, Microsoft's new best friend overnight.

Channel partners are customers; Ecosystem partners are customer enablers
We like to call all  partners who are not channel partners "ecosystem partners."  These include ISV who build on your platform, non-reselling systems integrators, vendors of compatible products and the platform partner your software runs on top of. Together, ecosystem partners provide all pieces of the "whole product" that you don't build or sell yourself. They don't write you checks. Instead, they give customers a reason to use your product.

An ecosystem partner manager's job at your company is to help these partners succeed. In our experience, this requires a different mind-set and management style that is needed with channel partners. 

We recommend that channel partner managers be in your sales organization and that ecosystem channel managers be in a separate partner/alliance organization.