Have you rethought your partner ecosystem strategy in terms of what new opportunities lie ahead? Are you prepared to find the opportunity in disruption? We can assume that business as usual is not going to work in today’s volatile business climate because business has become unusual. Yet, disruptive times are times of great opportunity for those who are alert in spotting them.
Shortly after the 2008 Great Recession, I dusted off a white paper written in the aftermath of the dot.com implosion in 2001. Based on discussions with the alliances leaders I learned that Cisco had doubled down on their alliance strategy to buffer the impact. By continuing to invest in alliances and realigning their strategy, Cisco generated 12% growth in alliance revenue during a time of general economic contraction and while the rest of their business was struggling.
In 2008 it was the financial sector that went into meltdown.
A colleague of mine worked with partners specializing in the financial sector. I erroneously assumed that his business had cratered with the financial institutions. I was wrong. Business was booming. Financial institutions were facing mergers, acquisitions, and consolidation. They are addressing compliance and regulatory issues that had been overlooked, leading to the crises, and were planning for new regulations and compliance issues that they anticipated would be legislated. My colleague was in a unique position to help solve the big problems these businesses are facing.
In the Covid economic crises, partner ecosystems are again shifting to address new opportunities: work from home solutions, tele-medicine, contact tracing, collaboration on therapies and vaccines. How can you pivot your ecosystem strategies to survive and take advantage of new opportunities?
Follow the shifts in buying behavior. Spending might be reduced in a recession, but it also shifts. Buying behavior changes. Smart businesses realign their strategies to take advantage of those shifts. The sudden work from home mandates created enormous opportunities. Microsoft and Google started promoting their web-conferencing tools aggressively and created programs and incentives for their partners to take advantage of the trend.
Solve the big problems created by disruption. Logistics went through a major disruption as retail goods shifted from storefront to webfront buying. The transportation network was in a frenzy rescheduling planes, ships, and trucking to serve this enormous shift. This dynamic and sudden shift required companies that normally compete to collaborate more effectively. An example, a business that uses Mercury Gate for inbound freight but might use JDA for international ocean shipping. In order to get shipments from point A to point B, these two transportation platforms needed to be able to share information and communicate in real time.
Leverage the benefits of shared costs and shared rewards. Partners are the ultimate ‘do more with less’ strategic play. Partners combine forces to provide even stronger customer value proposition at lower costs. Half of the assets and expenses are on your partner’s books. One manufacturing ecosystem alliance quickly realigned their value proposition. Instead of optimizing placement of equipment on the shop floor, they shared costs and expertise and shifted their focus on where to place workers on the shop floor and maintain social distancing so that manufacturing operations could reopen safely. Longer term they are looking at how manufacturers can re-shore parts of their value chain and build more resiliency into their operations.
Partner marketing has always been a great cost share opportunity. A marketing colleague shifted all marketing spending to co-marketing with partners resulting in lead generation and shared costs. A bonus of this strategy was that cross marketing on partners’ house lists yielded much higher quality leads. He achieved a higher quality sales funnel at half the costs!
There are opportunities for those who can address the pain points created by disruption and provide solutions. How can you realign your alliance strategy to focus on where companies will be compelled to spend to stay viable? Disruption creates opportunity and those who recover successfully will be those who can pivot their strategy to take advantage of the changes.