Software Executive Magazine

December 2017

Software Executive magazine helps software executives grow their businesses by showcasing the business best practices of our readers, executives from established and innovative software companies.

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Why Channel Partners Can Lead To B2B Software Success A digital first approach to partner management is the foundation of channel success. J A M E S H O D G K I N S O N CEO & Founder, Webinfinity ▶ S ales and service offerings which are global in standard but local in "feel," which includes elements like local language support and busi- ness-specific consultancy ▶ High-margin software with low fixed overhead. Given the above, it is hard to see any real path to true scale without partners. If you get your template right, it is realistic to create an army of invested and trusted organizations that will bake your offering into their business model. This can provide incredible reach to customers and markets that would never even get on the internal plan if you tried to scale purely through direct sales. It can be game-changing for your organi- zation and can lead to value creation beyond precedent. That said, being ready to scale is critical to success. If your organization is not there yet, or if it does not have a product or a process that can be easily replicated, then blowing up the model through partners could prove di- sastrous. Proving out direct sales and the fact that you can successfully sell and support your product is likely the first proof of any future success through a channel. But let's say your company is ready to go. The need for your solution is established, you have started to see traction, and you now have delivery and support pro- cesses that are repeatable and teachable. The next big problem is partner acquisition and engagement. How do you target, nourish, and engage prospects so they e tend to think of giant tech manu- facturers and distributors as com- panies who have traditionally lev- eraged indirect models to deal with physical problems like shipping, fulfillment, and bulk discounts for hardware inventory. When the cloud and SaaS came along, everything began to change. The conventional channel roles and responsibilities have evolved at a breakneck pace. There is a much bigger call for solution/deal-centric selling. All kinds of agile new cloud-first companies are appearing in the market. There are even cloud-only distributors re- framing the way we help partners do business. I read recently that MIT is seeing an increasing reference to channel partners in startup business plans. I'm seeing this trend every day: ambitious tech com- panies are realizing that channel partners are the key to fast growth and frictionless scale. Why? Think about what is needed for high-growth success in B2B tech: ▶ Packaged products that can be easily deployed and supported without significant training or service overhead ▶ Sales methodologies which are repeatable and scalable based on the parameters of the deal ▶ Access to multiple verticals and geographies through trusted referrers W The channel seems like an old-school term for what is such an exciting new- world opportunity. As we sit here today, about 70 percent of all revenue created by technology companies is generated by (or fulfilled through) a partner of some kind. That equates to around $3 trillion annually! But somehow the potential of scaling through partners is often overlooked or seen as the domain of "old-school" tech companies. CHANNEL STRATEGIES Framework By J. Hodgkinson WHY CHANNEL PARTNERS CAN LEAD TO B2B TECH SUCCESS SOFTWAREEXECUTIVEMAG.COM DECEMBER 2017 40

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