How do we win-win-win bigger?
My last blog post ("How do we win-win-win?") discussed getting to, and maintaining, a win-win-win position between suppliers, channel partners and customers. But what if you've got the win-win-win strategy sorted and you still need better results and more growth?
How can you push for growth and still keep the win-win-win position intact?
As you know, the win-win-win is where the interests of the supplier, the channel partner and the customer all align and all parties gain from a transaction. The simplest and most obvious way of growing your business is simply to replicate what you've already done successfully by adding new partners. By doing so, suppliers hope and expect to multiply their gains. Five partners should deliver five times the channel results, shouldn't they?
Of course, the answer depends on how the additional channel partners interact with your company, with each other and your markets. We need to understand the situation, for example:
Do we have the capacity, resources or processes to successfully deal with multiple partners?
How quickly can the new channel partners get up-to-speed on the new offerings and the target markets?
Have we identified sufficient market opportunity such that the channel partners complement, rather than compete with, each other?
The next most obvious way of growing your channel partner business is by doing what you're most likely doing anyway: trying to grow your own business. Success with the channel depends on a little more than just your own business though. To make this work, there are some additional factors to consider:
When growing our company, can we maintain alignment with our channel partners and the market opportunity? If we're adding new products for example, are these relevant to our existing partners and customers?
Are our channel partners able to grow with us? Do they have the capability, resource and motivation to grow at the same time and same rate?
Is there sufficient market opportunity to support the growth of both channel partner and supplier? Do customers have the appetite for our expanded offerings?
The diagrams above illustrate that the key to expanding the win-win-win is to ensure that all three parties are able to expand at the same rate and equally balanced. If the supplier expands by themselves, for example, there is little or no net benefit unless they can find a way of expanding the channel partner and market opportunity too.
The third method for expanding your channel partner business is not usually the first that springs to mind but is, in my view, the most successful and delivers the best long term results.
What happened in this diagram? The win-win-win has grown significantly but none of the parties have grown and we haven't started adding new channel partners or markets? Is this some visual trickery or sleight of hand perhaps? On the contrary: what this illustrates is the benefit of greater alignment between the three parties. It's common-sense really: if there's a scenario where there's greater overlap between your interests and those of your channel partners and customers, all will benefit.
So how do we achieve this?
A collaborative and constructive relationship between the three parties is essential. We need to create an environment where all parties are willing to discuss their needs openly and honestly.
Avoid the temptation to concentrate on your own needs and how to fulfil them. You can't achieve success alone.
Take time to explore each parties interests and welcome new ideas and perspectives. Understand desires, motivations and concerns.
By concentrating on the win-win-win, you can find creative ways of satisfying differing interests and objectives. Ensuring that all parties gain value from the situation is the way to ensure that each party gains the most value from the situation.
Here's where it all comes together.
Alignment. By better understanding the interests of our partners and customers, we build relationships that create more value for all concerned.
Growth. Equipped with this understanding, we are better able to synchronise the growth of all parties in a balanced and productive manner.
Replication. Because we have a better understanding of our channel partners and markets, we are better placed to devise a repeatable model for additional channel partners and markets that works for everyone.
Feedback. A closer relationship between the parties means that actionable insights are obtained more easily that result in added value for all concerned.
There are additional benefits from this methodology such as:
We understand the resources involved in delivering value; which of our resources are most important and when they are needed. This means we are better able to plan for and allocate additional resources necessary for additional channel partners and markets.
We understand the resources that our existing channel partners need in order to be successful. This means we can help new channel partners anticipate and plan the resources they will need to succeed in the future.
We understand the goals, aspirations and motivations of our channel partners. This means we know when our partnership is aligned and when there is work to do.
We have understood the value that customers expect from our partnership. This means we know what our offer must look like in order to succeed.
We have a better understanding of the market and how it can be segmented. This means that channel partners can complement rather than compete with each other.
It should come as no surprise that greater understanding is the key to greater success but the message here is that greater understanding is the necessary prerequisite to channel success.
Ash Madden is Founder and Director of Madden Associates Limited, the Specialist Channel Sales & Partnering Consultancy