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FIRST PERSON: The truth about partnering

FIRST PERSON: The truth about partnering

If you haven't heard the "partnering" edict in the channel over the last few years, you might as well stop reading now because you're obviously not a reseller, integrator, developer, channel player of any description or even, dare I say it, a vendor. You're probably not even breathing - all single cell amoebas to the back of the room please.

Partnering is good. But so are pork chops if you cook them right. I digress slightly, but my point is not that rash! My point is that most people are missing the point when it comes to partnering. Each time I see a press release or scroll over a company's Web site, I see this "partnering" phenomenon. Let's face it, why don't companies just say "we buy off the following companies . . ." or "we sell our kit to these customers . . ."

It reminds me of a time I tried to sell steak knives door-to-door (no really this job still actually exists). I lasted a day, well two if you include the one-day training seminar. The first thing they taught us was that a salesperson never says a thing costs xxx amount - you say this product is worth or is valued at such an amount - sales training 101.

The same applies with supplier-customer relationships. No matter how slick you spin it, one company is the seller and the other company is the customer. It's high time we called a spade a spade. Now I know most marketing types will start jumping up and down screaming "blasphemy" while salespeople start slipping into a Helfgott-like state at the simplicity of this idea, but the rules of business don't change. Customers need suppliers and manufacturers need customers. Yeah, you might be one of a number of "authorised" customers to buy and then resell a certain piece of technology, but at the end of the day it's a vertical supply and demand arrangement.

The other argument is that a supplier might approach an end-user customer with a reseller in tow. While I agree that this is a little flatter than straight supply-demand, it's still the same thing. In this situation if you break down what's paid for to which company, then it still comes back to a buy-sell relationship.

Where the industry is going is best described by the latest mutation of the English language - co-opetition. It's really as simple as it sounds . . . competitors working together so they can compete more aggressively.

This has been happening in the online porn industry for years. Companies try and coerce the unsuspecting voyeur into paying for content by trapping their progress with a million and one unwanted pop-up windows and new Web sites.

This way the online porn companies refer visitors to a range of competitors if they don't get the business themselves. If and when the surfer does actually subscribe to a service, the referral site can earn anywhere from 5 to 80 per cent of the money spent by the customer.

Telcos have also begun flirting with the concept of co-opetition. Long distance, mobile and local telephone services is a mug's game when it comes to margins. The result is they have to start moving up the value chain and into the LAN environment. But with integrators looking to protect their own backyard, its up to telcos and the channel to cooperate with their sometimes competitors in order to grow the overall market.

There's even been whole studies conducted on the issue of co-opetition. Obviously business graduate schools have far too few social demands, compared to the hazy recollections I have of an Arts degree I may or may not have done at some point (while trying to sell steak knives). Interestingly though, the latest research suggests networks of companies will begin competing with other networks of companies - sounds suspiciously like CorProcure and the various other flavours of e-market exchanges.

So while marketing will always dictate the need for cunning word play such as "solution" or "the value-add", at the end of the day, if it's not a horizontal partnership, it's not really much more than a glorified frequent flyer program. It's time to stop kidding ourselves.

Richard Noone believes partnering is a vertical expression of a horizontal desire . . . much like dancing. Ask him for more information at richard_noone@idg.com.au


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