- By Fred Johannessen, Technology Alliance Program and Market Zone
Relationships of all kinds can be messy. Even with the best intentions, many times relationships fall apart because of missed expectations. This is true in personal relationships and it definitely applies to relationships between companies. Missed expectations occur many times due to a failure to manage expectations on both sides. For example, a potential partner may have certain revenue expectations out of a relationship, but the other company, may not be able to execute to those expectations. Sometimes they happen due to a not having a clear definition of success. For example, is success getting an agreement in place or is it creating a win-win where both companies make significant revenue with the relationship. These can be interrelated too, where there are reasonable long-term goals for success, but these get clouded by what Jack Welch in “Winning” calls “deal heat”. This is where the goal becomes getting the deal done, not creating a long term winning strategy.
This is why I tell prospective partners that it is just as important for us to get to a “no” answer quickly as it is to get a deal in place. I would rather stop an engagement early before any real damage is done than to have to terminate an agreement with disgruntled people on both sides. We are usually very good at coming up with all the reasons why we should have a partner relationship: unlimited revenue, big channel, great technology, etc. But we tend to forget all the reasons why we shouldn’t engage. This is why it’s so important to be earnest and forthright. It’s important to understand your own limitations as well as the prospective partners before moving ahead. For example, is there executive sponsorship in both companies? Are there proper resources such as product management, marketing, field, developers to do integrations assigned? Is there a go-to-market plan? Is there a cultural fit? Can a small company deal with the larger company? If those things aren’t in place, then how will revenue happen? I’ve seen relationships fail with everyone in place except a field engagement model and it turned out the sales people could not get along culturally – actually it turned out to be a compensation issue.
This is why I consider integrity the most important trait in business. Not only is it the right thing morally, but it’s the right thing for business. With integrity you can honestly assess with the prospective partner whether the relationship will really work. With integrity, comes predictability that your organization will deliver what they claim. And so, with integrity comes the opportunity get to a no answer more quickly than beating around bushes or glossing over limitations in your organization and thus wasting time and resources of both companies that could be spent pursuing real opportunities. At the end of the day getting to “no”, in this small world, may mean getting to a bigger “yes” with the same company or people from that company at a later time because they respect you and know that you won’t waste their time.
It has been awhile since I blogged and a lot has happened since. I’d like to say thanks for all my father, Oluf, did for me in giving me an example of a person with integrity in every aspect of his life. And being a great human being all around. He passed away May 12th, 2008. RIP
The postings in this blog are my own and don't necessarily represent BMC's opinion or position.