The poorest performing IT reseller companies are the most opportunistic. In the words of the famous business strategist Michael Porter, “To the company without a strategy, everything is an opportunity”. Poor performing resellers chase their tails, and every opportunity that comes along. Long-term high performers invest time in building their strategy, then invest resources in dominating their chosen markets. It comes down to maturity, focus and commitment.

Much of the under-performance of channel partners can be explained by the lack of a coherent company strategy. We’re not talking about functional strategies like a marketing, product or sales strategy. Those things need to come later. The problem is that most channel marketing partners (often driven by well-meaning Vendors) put the cart before the horse. They often develop marketing and product strategies in complete isolation from any corporate strategy or direction.

And yes, I recognise that most channel partners are not “Corporates”. I understand that the majority are SMB’s, often led by the technically-focused company founders. And this makes the need for a company (or corporate) strategy even more critical. I should know…Ridge Consulting specializes in strategy development for technology small and medium business (SMB’s). This is our world.

Let me give you just one example. You are no doubt already familiar with S-curves which explain technology and business cycles.

s-curves

As the graph shows, successful high performing companies need to be able to transcend the regular business and technology cycles. As one cycle ends, they need to have already found the next one and have adapted their internal resources and business model accordingly.

However, if (and I have multiple experiences of seeing this in the channel myself) their entire company strategy is built around “Technologies A from Vendor X”, then it is almost impossible for them to seamlessly make that transition. As the cycle ends their business goes into flux, revenues fall off a cliff and staff and business relationships suffer, often irrevocably. All of the marketing plans, product plans etc. were built around a small solution set rather than a wider mission of value delivery over the long term.

This happens regularly, worldwide and it is totally unnecessary. All that is required is for leadership teams at resellers (and their Vendor counterparts) to stop, analyse and start planning.