When forging a business partnership, consider the strings of the relationship - and your potential bedfellow - before signing onI recently had the pleasure of sitting on a panel with some integrators and consultants to discuss how partnering works for IT services companies. It was a free seminar, so the room was packed.
The seminar was geared to services firms interested in partnering with other vendors to provide full-service capability to key customers.
On balance, I would say that most of the audience participants wanted to know how to do business with the "big name" integrators that were on the panel - EDS, Digital and MCI Systemhouse. The integrators were very polite and helpful, but it was clear to me that not one of the vendor audience members (well, maybe the guy from SAP . . .) would get a meaningful partnering relationship in the next 12 months with these big guys. And the reason for that: IT'S HARD! There are more reasons for a large integrator not to do business with another vendor (regardless of the competitive threat or size) than there are to go forward or even experiment with partnering.
In theory, alliances - "strategic partnerships" or even joint ventures - are always struck with the best intentions. But in reality, like most high-profile initiatives, alliances are struck between executives who rarely have to face the customer on a day-to-day basis. Not surprisingly, these relationships have trum-peted their original pronouncements. Call it account control, call it finger-pointing, call it what you will: two or more integrators or vendors in a single account generally have a hard time working together on a daily basis. Ask any lawyer who's had to negotiate the after-effects of a complicated alliance.
Unless you're talking about subcontracting - now that's a different story. In the government market, subcontracting is a way of life. But it's not like trying to "partner" in the commercial market.
The roles are clear in a subcontracting relationship. You know what the food chain is and your place in it. More importantly, decision making, rules of engagement, and chains of command are specified in the master contract. The thorny problem of who "owns" the customer seldom crops up.
Now, I didn't want to rain on anyone's parade at this seminar, so I tried to keep my scepticism about partnering in general to myself. But I did get to offer some words of advice.
If you really want to try partnering:
1. Rely on your personal relationships with field people in other companies. The best deal is the deal put together by two people who've known each other for a long time.
That's not to say that ivory-tower, corporate partnering programs don't work; they just take longer to get started and require high maintenance to keep running.
2. Forget about trying to get in bed with a celebrity - it's better in fantasy, even with IT services! Some of the well-known integrators make lousy partners.
And the less you have to offer them, the more expendable you are. Chances are, the only way you'll get their attention is by bringing a choice customer to the table.
After you consummate the deal, what do you think your chances are of holding onto that customer?
3. If you're a small company, look for other small companies to partner with. As I told the seminar's audience (which mostly consisted of small integrators and large vendors with little name recognition in IT services), the VAR and reseller market is filled with capable companies that have vertical expertise and enviable customer relationships.
This article was originally published in Solutions Integrator, ARN's US-based sister channel publication