Partners and Profitability

Last year, I posted the following statement.  Some people agreed, and some didn't. (Larry Walsh even made a video! https://lnkd.in/ee66VF4N) But two years and many industry layoffs later, I am doubling down.

Your job as a partnerships leader is to make your channel the most attractive route to market for your organization.

This is not a controversial statement. But it’s also not easy.  To start, partnership leaders need to have the financial acumen to understand what’s driving organizational strategy and how to make their channel contribute to both the top and bottom lines.

Last week, I presented “Essential Financial Skills for Channel Professionals” at the Elevating Women in Channels workshop presented by Advancing Leadership Network and Informa at MSP Summit.

In this environment, resilience is key. When capital is expensive, aligning the “growth vs. profits” scale to your organization's EBITDA goals is paramount. In the session, we discussed gross profits, net profits, COGS and the Rule of 40. We also explored where we show up on the P&L, the impact of sales and marketing expenses, and how many logo golf balls we really need.

“But Heather, isn’t our “one job”  to create a great partner experience?  Is that what’s most important?”

No.

If partners are happy, but our leadership (and board and investors) don’t see our channel as attractive because it doesn’t align with the company’s financial objectives, partners won’t stay very happy for long.

Partners are most at ease when supplier objectives are aligned with their own.   Back in my channel chief days, the most productive thing I did when there was friction with my partners was to invite them in and show them our financial modeling and the numbers behind our program decisions.   We all wanted a sustainable partnership, and we worked together to make it happen.

I’ve also learned lessons the hard way.  Partner programs that don’t align with corporate strategy or have executive buy-in are fleeting.  People get laid off, and partners get burned.

So, what does a resilient partnerships leader do?

1) Accept your new job description.

2) Make sure your financial skills are up to snuff.  Message me for ideas on how. (If I can do it, you can do it)

3) Ensure your CFO is your BFF and you know what’s driving the strategy and P&L today.

And I am still interested in whether you all agree :)