Part of a Series: Are Your Alliances Missing the Money?
- 3 Steps to Monetize Your Strategic Alliances
- Step 1 – Build a Complete ATM Bridge to Your Customers
- Step 2 – Set up your Alliance and Bus Dev organizations to both “hunt” and “farm”
- Step 3 – Choose the Business Model that Matches How Alliance Solutions are Sold
- Measuring Alliance Impact:
In my most recent post I talked about the barriers that companies face as they try to monetize their alliances. I defined 3 Steps to Monetize these alliances and focused on Step 1: Build a Bridge between you and your alliance partners’ customers”. In this week’s post, I will focus on how to execute Step 2: Set up your Alliance and Bus Dev organizations to both “hunt” and “farm”.
“Hunting” and “Farming” are common analogies in the tech industry (particularly in the US) to describe different types of sales roles, and they apply to tech industry alliances roles as well. In the tech industry:
- A “hunter” is someone who goes out and finds the customer, sells them your product, and brings the meat (the customer PO) back to the company (triumphantly).
- “Hunting” is a one-off activity in someone closes a deal today, and then goes out and starts all over again to close another deal next month. They are compensated to find and close deals, not nurture long term relationships.
- In the context of Alliances, a “hunter” is the person in your organization who signs the deal with a partner that has revenue potential, or someone who goes out and helps generalist sales teams close deals for the joint alliance offering.
- A “farmer” is someone who maintains or expands business with existing accounts by nurturing and expanding customer relationships – rather than by landing new customers or big deals.
- The “farmer” also feeds the company, but by developing a repeatable process for bringing in customer orders they can create a stream of orders over a long period of time that can provide the ongoing revenue that a company needs to survive and thrive.
- In the context of alliances, a “farmer” is someone who is accountable for taking the visions and opportunities of the alliance “deal” and turning them into repeatable sales and marketing programs that lead to revenue.
- A farmer can be in sales, or they could be in marketing or another group, but they are someone who operates in parallel to the sales and bus dev to create programs and processes that all deals and alliances can leverage – to drive revenue after the signing of the deal…
There are two intertwined dynamics at work here that combine to undermine the execution of the alliance and ultimately the revenue – and are the result of “boxed” thinking and execution and were defined in a post earlier this year – the 4 boxes that prevent alliance revenue.
- The first dynamic is associated with defining and executing all the elements necessary to drive revenue – which I call “the Task Box” (link to post).
- The second is associated with cross functional teams in tech organizations and pertains to what group owns and has the skills necessary to drive all of these tasks – which I call “The Ownership Box” (link to post)
The elements that are necessary to drive revenue from an alliance (and overcome the Task Box) are illustrated in the Alliance GTM Bridge shown in Figure 1 below.
Figure 1: Building an Alliance GTM Bridge
Steps to Building the Bridge (executed outside-in)
- Step 1a: The Anchors (Focus Products and Target Customers)
- Step 1b: The Foundation (Solution and Sales Channel)
- Step 1c: The Road Over the Bridge (GTM Program and Field Readiness)
Within each of these six areas, there are a lot of program development and execution elements (that I will cover in a future post) – but the grim reality is that most companies do not have the right set of cross-functional resources to complete the tasks necessary to cross the bridge – and to assure that the alliance drives revenue.
What often happens is that the folks hired to be Alliance Managers or business development have one of two backgrounds:
- They could be technically driven – which leads to good definition of the left half of the bridge – but not a strong understanding of GTM programs, sales or channels.
- They could be Business Development or deal driven – which leads to signing new deals or initial momentum with an alliance – but have a compensation plan and skill set for dealing with the technical issue and sales enagement, but not the development of GTM programs and processes that lead to repeatable alliance revenue.
In the reverse case, an organization full of “farmers” tends to develop an internal focus – working through organizational barriers and processes, and losing touch with the needs of the customer.
So which type of person do you need to be successful in driving alliance revenue in your organization? The answer is simple, “YOU NEED BOTH HUNTERS AND FARMERS ON YOUR ALLIANCE– OR YOU WILL PROBABLY NOT SUCCEED IN DRIVING REVENUE!”
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