Alliances
at Software 2006
Vinnie Mirchandani (www.dealarchitect.typepad.com), Bruce Richardson of AMR Research and executives from EMC, Tata Consulting Services and Oracle spoke today on Alliances. This group addressed approximately 80 tech CEOs. Many of those in the audience were heads of service firms and their attendance to this exclusive breakout is testimony to the interest many of them have in allying their firms to other software or product companies.
Vinnie, a sometime arch-nemesis, colleague and business partner of mine, was quite kind in sharing his 15-minutes of fame with this group with me.
Vinnie briefly spoke about how many tech alliances/partnerships are unlike those in industries like automotive or aerospace. In those sectors, companies start first with a targeted price for a given solution and then blow the cost down through their supply chain and business partners. In technology, the end-customer total price is not looked at all. Everyone seems to ignore this and only focus on how much can each firm can get from the feed trough.
Before either Vinnie or I got up to speak, Bruce Richardson gave a white-hot run down of stats and facts re: MISO (Microsoft, IBM, SAP and Oracle) vendors and their partner ecosystems. Please check with www.sandhill.com over the next few days to see if you can get a copy of Bruce’s presentation.
My comments were targeted to those in the audience seeking a partnership with a major firm like a Big 4 system integrator. I have a particular expertise in this as I entertained hundreds of such overtures during the decade that I ran Accenture’s Software Intelligence unit.
My advice to the attendees centered on making that one meeting, the initial meeting that is so hard to get, really count. Too many firms blow this first impression and can never get a second chance.
One of biggest mistakes most firms make in these meetings is coming in with their sales deck and not a deck specifically designed for this type of discussion and this specific prospective business partner.
This special deck should be about seven slides long. It should address the following:
- Your top 3 messages – Really work on these. If any of these could be said by your competition (i.e., we hire only great people or we are an industry leader), these aren’t great messages
- Show me what you know about my firm – Prove you understand how our sales people will get trained (and stay current) on your solution. Show me that you know our offerings and have a point of view about how your product or service will improve them
- Define the customer view of a great partner solution – Tell me why customers are going to get a better service, lower price, better value, etc. when we team on solutions. You can’t get a partnership if the customer is getting a worse solution.
- Show the top-level executive commitment to this relationship – In the early stages of an alliance, any little hiccup can torpedo all of your partnership building efforts. Tell me how I can call your CEO and get an issue fixed in a manner of minutes (not days or weeks).
- Tell me how you see the long-term flow of the relationship working out – Demonstrate that you have realistic plans and realistic expectations.
What you don’t need though is an egotistical sales deck for this meeting. Leave the slides at home with pictures of your headquarter buildings and the world map showing all your office locations. You don’t need to re-qualify your firm because you already got this meeting. Focus on the power of the relationship and the new client value delivery opportunity instead.
Many other great issues originated in this talk. I speculated on the re-emergence of equity stakes as part of partner deals. These should be earned (not given outright) and only when a solid quid pro quo exists.
One participant inquired about the need to protect IP from certain ‘partners’ – particularly those with a reputation for appropriating partner functionality into their own offerings over time. A great question that many experts dodged.
A discussion like this one only scratches the surface on this subject and the group could have talked all day long on this matter.
Your comments?
Really great summary Brian - I almost feel as though I was there - not 5,500 miles away.
Posted by: Dennis Howlett | April 05, 2006 at 11:08 PM