Building Successful Partner Channels: In the Software Industry

"When Microsoft acquired Navision, there is no doubt that the value of our channel partner ecosystem heavily influenced the price they paid. I can think of no one better suited than Hans Peter Bech to write a book titled Building Successful Partner Channels."
- Preben Damgaard, Co-founder and CEO of Navision

"Predictable growth and market leadership through independent channel partners are on every software industry CEO and sales executive's mind. However, it is rarely achieved. With “Building Successful Partner Channels” Hans Peter Bech provides a great tactical approach toward reaching this goal."
- Torulf Nilsson, Product Executive, Visma Retail, Oslo, Norway

"Hans Peter Bech has been at the forefront of developing indirect channels in the software industry for more than three decades, and his track record is impressive. I'd highly recommend this book to anyone searching for the route to global market leadership in the software industry."
- Yusuf Soner, School of Management at the Sabanci University, Turkey

"Building Successful Partner Channels provides a powerful, practical approach to building a strong network of independent channel partners to optimize sales and marketing activities. The book helps senior sales and marketing executives understand how to work in concert to achieve global market leadership through the indirect-channel approach."
- Toke Kruse, Founder and CEO at Billy, San Francisco, USA

“Building Successful Partner Channels” is a book laying out the roadmap for achieving global market leadership through independent channel partners in the software industry. The book applies the business model and the business model environment frameworks developed by Alexander Osterwalder and Yves Pigneur. It concludes that taking the indirect route to market adds a layer of complexity to our business model as we leave the control of finding, winning, making, keeping and growing happy customers to third parties.

The book explains that the direct and the indirect go-to-market approach are not options we can choose freely between, independent of the nature of our business model and business model environments, and it discusses when the indirect go-to-market approach is applicable and advantageous and when it is not. The book concludes that taking the indirect route to market requires that the channel is an integrated element of our product offering and value proposition.

The indirect route to global market leadership requires developing and maintaining a channel partner program, and the book lists all the elements of this program, including the critical channel partner P&L model. The book concludes that our partner program will change substantially as we move from early-stage channel building to the mature mode, where most of our revenue comes from existing channel partners. The book describes the process for channel partner recruitment and concludes that the initial process is very similar to hiring top-performing salespeople.

However, where we pay staff to perform their duties from the day they join, channel partners will have to make substantial investments before they reap the benefits of the cooperation. Channel partner recruitment is therefore initially a long process requiring substantial investments. The dynamics of channel partner recruitment change as we move from the early mode channel development stage to the mature stage, and the book recommends recruiting as many channel partners as possible. We then let them demonstrate where they belong in the channel pyramid classifying channel partners and the book discusses how we should manage each group.

A full chapter is devoted to discussing adopting the indirect channel approach at a later stage after having applied a direct approach first, introduces some simple sanity checks to verify if switching is feasible and explains how this switch can be accomplished.

Hans Peter Bech is a bestselling author and a frequent blogger on how to make information technology companies global market leaders. He has produced numerous books, papers, podcasts and videos on business development in the IT industry. Hans Peter is also a keynote speaker, workshop facilitator, and an advisor for governments and companies. He holds a M.Sc. in macroeconomics and political science from the University of Copenhagen.