Our P2P articles to date have discussed “What is P2P all about?” and “Putting the right steps in Place to enable P2P.” As we dig a little deeper, let’s focus on the concept of what business trust, fairness and mutual respect looks like, and what the channel can do to improve this critical side of partner-to-partner collaboration.
Trust is at the heart of all P2P collaborations, but how do you build a business framework that fosters trust, ensures fairness and results in mutual respect and business growth—especially if these partners are ones with whom you have previously competed?
Building a framework is key. It could take the form of a detailed contractual document, a business plan or even a less formal working document; however, it should be in writing, agreed upon and signed. More importantly, it should be audited against reality as the collaboration matures and takes shape throughout the working relationship.
The framework is usually first tested under the guise of a project for a customer, and so can be stretched to the breaking point if not fully considered, discussed and agreed upon that it’s fair. As already stressed, an external project governance advisor can bring huge benefit here with their independence, project experience and pragmatism. This can keep the project and the P2P agreement on track and therefore has a cast iron ROI.
The framework isn’t just a contract, however. It also includes emotional and cultural issues that need discussion, but are hard to nail down in a contract. Working through these topics together should help define those more nuanced parameters.
- Why do you want to engage?
- What are the common objective, subjective, material and emotional goals? These should extend beyond the company or business goals, as a good working relationship will be so much easier if you understand people’s motivation.
- What are the shared values? The cultural fit in any collaboration can make or break a business partnership. Ensure that the whole team shares the joint values, and they aren’t just understood at the executive level.
- Who is responsible for the relationship? There should be a “Partnership Manager” or someone responsible for alliances in each party to champion the needs of the collaboration.
- Who is responsible for setting joint objectives and metrics? This should be established at the outset of the collaboration by the executive level team from both parties.
- How will both companies measure success? This is really important but often forgotten in the rush to execute on the first project.
- What is the long-term vision? Again, this is something worth taking time to detail and reach a mutual understanding on from both an individual and company perspective. Maybe someone wants to sell out, maybe someone wants to take over. Making sure both parties see a mutually beneficial long-term vision is key.
- Who is responsible for project management and all elements of project?
- Who leads the opportunity? There is no golden rule here as personalities at both partners and the customer will play a part, but there has to be a named individual.
- How will you oversee project governance between partners and customers? Although there should be internal responsibility within both partners, this is about project governance, and the execution and tracking of progress is best performed by an independent third party.
- What is the remuneration plan? With many of these new collaborations being formed through technology changes like cloud, a new remuneration structure is also required around subscription revenue and services rather than up front project payments. Taking advice on how to structure the remuneration plan will save a lot of issues further down the road.
- How much investment will you both agree to commit?
- Are there marketing costs? What branding or logo will be used? This may seem trivial, but it will matter hugely to the team doing the marketing.
- What pre-sales training and support is required? Do you have time and resources earmarked for team readiness?
- How will you divide the revenue?
- Is this collaboration a one-hit wonder, opportunistic or do you intend to build a growth and business strategy around this initiative? If so, who and how do you lead the sales drive?
- What pipeline is required and what is the sales cycle of the joint proposition?
- What happens if there is a dispute with the customer or between partners?
- An agreed set of mediation processes up front can effectively deal with small disputes before they become big disputes. Don’t make a crisis out of an issue!
- Is this an exclusive arrangement, and is each partner permitted to pursue similar arrangements with other firms? How is that defined and agreed upon upfront?
Much of the above may seem like common sense, but it is clear that many collaborations fail because though all parties may be experts in their field, they may not be experts at collaboration. If a clear P2P collaboration framework has been agreed up front, the engagements are clearer and projects can be undertaken with mutual goals and respect.
Nothing remains the same in this fast changing industry, and there will always be a need for flexibility and practical common sense. And, like any partnership, each P2P collaboration is different. But ground rules foster trust, and mutual goals help everyone meet expectations. Although one swallow does not make a summer, one successful, profitable project done under a P2P collaboration framework paves the way for business growth and mutual benefit.