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​Why joint business planning with partners reaps rewards

​Why joint business planning with partners reaps rewards

Gartner research director, Mark Paine, explains the pros and cons of joint business planning for channel partners.

Mark Paine - Research Director, Gartner

Mark Paine - Research Director, Gartner

Business planning with your strategic vendors will ensure closer alignment to mutually agreed goals, optimal allocation of resources and improved sales execution.

For technology providers that operate an indirect sales strategy and generate significant revenue from third-party partnerships as part of their go-to-market approach, business planning with strategic channel partners pays off in improved sales performance.

If the individual plans of both companies are aligned, the partnership yields more than if the two companies were to work independently.

Joint business planning takes time, effort, patience and strong leadership, especially if your company is new to a provider's partner ecosystem or if you are unfamiliar with working closely with providers.

Not all channel partners view a close working relationship with a provider as necessary for future growth and prosperity.

Some are agnostic and view any relationship with providers at "arm's length" and will claim to be agnostic in their recommendations to customers. Some channel partners are more opportunistic and work more cooperatively with providers but on a tactical level.

Those considered by the vendor to be strategic partners are those who want a synergistic relationship and are happy to be aligned to the provider's business direction.

Their business may well be based solely on the provider's products and services, or these products and services may contribute to a significant part of the partners' revenue and profit.

In this instance, the partner will almost certainly view joint business planning as an essential part of the business relationship, sharing risk and reward in equal measure and working toward successfully meeting joint objectives.

But let's be under no illusion. Joint business planning that delivers realistic objectives is very hard to do. The most important element of planning is to synergize your goals, objectives and tactics with those of the partner.

This will probably require a number of iterations before agreement is obtained. It takes time, as well as business planning and negotiation skills.

On the provider's side, the channel manager must be accountable for the joint plan and should be remunerated on success or failure.

On the partner's side, a person should also be held accountable for the plan because the status of the partner in the provider's eyes will rest on successful execution.

Think "gives" and "gets". True partnerships work on the premise of shared risk and reward. Both parties must be prepared to accept that plans can go off course.

Set up processes to get plans back on track, and bear in mind that your business must be aligned with future direction of the vendor. Successful execution of a joint business plan does not guarantee future strategic partnerships.

Mark Paine is a research director in Gartner’s Technology and Service Provider team, focusing on global and regional channel strategy, channel programs, through and to partner marketing, new market entry and channel sales.

This article originally appeared in the August issue of ARN magazine - to subscribe, please click here

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