5 Steps to Becoming a Great (Services) Partner
And three reasons you should want to partner with a software company
The purpose of this post is to review 5 steps to becoming a great services partner to software vendors. The intended audience is anyone building a services business from the ground up, or looking to improve one that’s already up and running.
Why Partner? Why not go Direct every time?
Before we jump into the 5 step plan, let’s start with three reasons why you want to be a great partner to a software company:
A software partner will introduce you to new clients. “But why would they do that?” you ask. Well, software companies need good services partners to help clients use their software successfully. How do I put this… they need you. That software isn’t going to make itself work. And a software company doesn’t want to have all that services revenue muddying up their software and SaaS multiples. But their clients need help getting that software to work in their environment and for their business. These opportunities will range from co-marketing to co-selling to subcontracting. They have varying levels of revenue quality.
You can go fishing in a software partner’s ecosystem for new clients. Now that you’re in that partner ecosystem, you don’t have to just wait for them to bring you into customer opportunities, you can go look on your own, within their ecosystem. If you do enough reference-able with #1, you’ll then have the street credibility and expertise to land new clients based on good word of mouth and references from the software vendor. Most of these contractual relationships will be direct with clients.
Ultimately, you can grow your business faster than you would with a purely direct sales approach. A good software partner will accelerate your growth by improving sales velocity - more opportunities to bid on, and more mature opportunities at the first contact.
(Bonus): Direct sales take longer to mature, and require a higher degree of sales capability. You need to develop these direct sales muscles, but while your direct relationships will eventually be your best relationships, it takes time to build them up - and selling through a technology partner can be a great way to bridge the gap.
Okay fine. now you know why you want a good software partner. How do you not just do that, but be great at it? Well, it starts with this:
Being a good partner isn’t an accident, it’s a core competency.
Partner Bonafides - Why Listen to Our Advice?
So let’s talk about building that core competency of being a great partner to your software partners. You might, right now, be asking yourself, what would Scott know about being a great services partner?
First of all, I spent the first part of my career working for software companies, starting as technical staff making half-finished software do amazing things for our clients in the 90’s, and then managing teams of services professionals who did the same thing. I learned how to help both client and our software team get a win in every engagement. This view from the inside helped inform how to partner successfully with software firms.
Second, when we started BP3, we took some of those key lessons with us, and they’re a core part of our culture. I also was lucky enough to hire and learn from people who are even better at partnering with our software partners than I am. They get the mechanics and logistics to work like a machine, while I (hopefully) set the tone for collaboration. Even more, I’ve had great advisors from within our partners. I’ve learned so much from my own team and our partners, and it has made me a better partner in turn.
Lastly, over the last few weeks, that education and hard work has been recognized:
Two weeks ago, Automation Anywhere announced that we won their Partner of the year for 2022 in the Americas.
Last week, we announced that we won Camunda’s highest partner honor, globally, in 2022.
This isn’t entirely unexpected - after all, just last year, we also won one of Automation Anywhere’s Partner of the Year Awards in 2021 - and we have the trophy to prove it!
In previous years, we’ve been IBM’s partner of the year for IBM’s Automation suite. Agilify and TransformAI, whom we acquired, have also been recognized as top partners by BluePrism and Automation Anywhere, respectively.
You can find other very credible sources
Okay, but what about the 5 steps to Partner Greatness?
There’s a tendency to think partnering and awards simply by chance, or brand, or spending money on marketing or PR. But partnering comes simply from intentionality and consistency… making partnering a core competency:
First, do great work for clients. Results in production are the #1 goal of our clients, and that Return on Investment is also a top goal of any good software company - because it will help drive more software sales. This is about earning trust.
Second, become deep experts on the technology platform of your partners. At BP3 this is all about #moreFocus - we need to be the experts to help our clients in the way they need it most. By the way, this is also about earning trust.
Third, listen to our technology partners for what is needed most in their ecosystems, and by their clients, from their perspective. It may come as a surprise, but this is also about earning trust.
Fourth, make sure that your technology partners understand how you can best add value in their ecosystems - reflecting back to them the needs you feel you best fulfill. We will always follow through - #moreFollowup. Again, doing this helps build trust…
Fifth, share your insights into the market from your perspective- this is the #moreForesight pillar of our brand. We make sure our clients and partners get the benefits of our insights. Now you’re building a following, based on the trust you’ve already developed, and the insights you’re in a position to share.
Trust. And Relationships.
As a technology services firm, your most important relationships are with your clients and your technology partners. You have to do the work to get to know them both, and to build two-way trust. Building professional and personal relationships with your clients and partners is critical to building a services business.
I’ve often had team members raise concerns that leads are coming from word of mouth rather than, say, a specific lead generation campaign. But how did this person learn of our firm? Odds are for any client it is one of these:
Someone at the client worked with our firm before, and had a good experience. They’ve come back for more.
Someone at the client worked with someone at our firm before, and they’re following a trusted professional relationship.
A colleague recommended us to this client, and they’re following that referral.
A technology or services partner recommended us to this client, and they respect the expertise we are reported to have.
We met at a conference, trade show, partner event, or professional social event.
Any and all of the above were supported by email and social media marketing campaigns revolving around our key pillars and around our specific use cases and references. Something clicked.
Any and all of the above were supported by a check of analyst reports and reviews, which led to connecting with us.
So don’t look the gift horse in the mouth - work with those relationships! Services is a people business - building relationships is not only personally rewarding, but it is good for business! So take it seriously and put in the work!
One more thing… can you moneyball pop hits? A recent article from the Graduate School of Business at Stanford ponders whether you can separate one-hit wonders from hitmakers based on the data for their early hits..
Why has Beyoncé had over 60 hit singles since 2003, while Hilary Duff, who debuted on the charts in the same year, has only had seven? How do we account for the enduring catalogs of Billy Joel and U2 while Lou Bega’s and Blind Melon’s stars quickly fizzled? And, why, for every Stevie Wonder or Dolly Parton, are there dozens of Tommy Tutones and Chumbawambas — acts that score a hit or two and then all but disappear?
It turns out you can. Analysis of their catalog prior to first hit tells a story about what the rest of their career is likely to look like.
Okay, maybe just one more thing… Which is this. Last week I wrote about the M1 chip and its impact on computing (or at least on Apple products!). This week, Apple’s Q2 (calendar Q1) earnings came out, revealing how Apple is performing thus far in the new year. If you recall, Fiscal Q1 (calendar 4th Quarter) was a blowout for Apple - their best ever. This quarter was their third best quarter, ever.
$97B in revenue - for the quarter, vs expectations of $94B.
The Mac grew substantially, from $5.3B in Q1 2020 to $9.1B in Q1 2021, to $10.4B in 2022! Reflecting the strong momentum that an M1-driven machine has created for Apple’s Mac lineup.
Gross margin of 43.75%.
Essentially, Apple was firing on all cylinders, and was only significantly impacted in iPad performance due to supply constraints. Of Course, the stock traded down a bit on the news, as investors potentially look forward to a rockier story for Q3, where Apple set expectations that supply disruptions would increase in impact on their financials.
You can find all the fun stats and commentary in the quarterly earnings transcript, here.