Ecosystems are a hot topic in the business world these days, especially in partnerships circles. However, that excitement doesn’t always translate to success. The fact is, business ecosystems can easily fall apart—one analysis found that not even 15% of studied ecosystems were genuinely sustainable. Partnerships pros must have a clear vision in mind while building their ecosystems to avoid this fate.

As Firneo’s Partner School initiative continues, Scott Pollack (Firneo’s Co-Founder and CEO) spoke with Christopher Holley, Global Director, Technology Partnerships for commercetools. Christopher has spent 25 years building partnerships and alliances, including a lengthy stint at IBM. Over the past quarter-century, he’s learned a great deal about establishing and maintaining partner ecosystems—information he was happy to share with aspiring partnerships leaders.

What Is a Partner Ecosystem?

Christopher described an ecosystem as the larger environment a business operates in, consisting of adjacent and complementary elements that create value by coexisting. As a way of explaining the interconnectedness of companies, services, and functions within an ecosystem, he compared these environments to shopping malls. The average mall houses a wide variety of restaurants and shops—and while these are ultimately separate businesses, they can undoubtedly benefit from operating under the same roof.

Moving into the realm of partnerships, a partner ecosystem represents a network of collaborators, suppliers, and service providers that work together to deliver value to customers. As Scott noted, no business operates in isolation, and partnerships are essential for companies to thrive in today’s competitive landscape. Building symbiotic relationships within an ecosystem allows partners to leverage each other’s strengths and resources to achieve mutual success.

Building Ecosystems With Intention

One of the biggest takeaways from Christopher and Scott’s discussion is the importance of intention while building a partner ecosystem. Christopher emphasized the need to align partnership efforts with the broader goals and objectives of one’s business instead of pursuing partnerships for the sake of activity.

As an example, Christopher spoke about his tenure at Productsup, a company focused on automated data catalog syndication. To help this company gain a foothold in the North American market, he started looking for businesses that might need its services, particularly in the product information management (PIM) sector.

Out of the top 10 PIM solution providers in North America, six didn’t offer the services provided by Productsup, creating an obvious opportunity for collaboration. Christopher focused on building relationships with six of them, positioning his company as a valuable ally that addressed their pain points and complemented their own offerings. 

From there, he was able to garner support and commitment from major players in the industry and tapped into their own service provider ecosystems, identifying systems integrators that could also become valuable allies. By following a clear strategy while expanding Productsup’s ecosystem, Christopher forged mutually beneficial partnerships which drove value for all parties involved.

Avoiding Pitfalls in Partnerships

The discussion also touched on the risks of building partnerships ecosystems without forethought and intentionality. Christopher shared a cautionary tale: a company that pursued new partnerships as a “quick fix” for its sales challenges. This approach, driven by desperation and a lack of intention, generated partner leads that were simply not capable of sustaining a valuable ecosystem. Worse still, it failed to address the company’s underlying issue of insufficient lead generation. 

As any qualified partnerships leader knows, a successful partner ecosystem is one that generates value for all parties involved. With that in mind, Christopher introduced the concept of “high-potential partnerships” as a model for building strong relationships. Instead of focusing on sheer numbers, businesses should carefully select their partners based on shared values, mutual benefits, and a commitment to joint value delivery.

Understanding Ecosystem Dynamics

Every company with a partnership program has its own partner ecosystem, but not every company plays the same role in the ecosystem as a whole. To illustrate this concept, Christopher compared businesses to celestial bodies—in a solar system, a star naturally exerts influence in the form of gravitational pull. Meanwhile, planets revolve around stars and rely on them for stability. Recognizing whether your company is a “star” or a “planet” is crucial for making strategic decisions about your ecosystem.

The distinction between stars and planets often reflects your business model: if you rely heavily on another platform or external infrastructure, you’re likely a planet. However, if your business possesses unique value and control, it may function as a star instead. Entities like databases, CRMs, email services, and e-commerce platforms often act in this capacity.

Of course, not every company fits into this structure. For example, Christopher compared businesses providing “white label” software to “comets”—while they aren’t technically stars, they can occupy a similar role in the marketplace due to their lack of direct competition.

Adapting to the SaaS Evolution

The conversation then explored the evolution of software as a service (SaaS) and its influence on ecosystems. Christopher said software has largely shifted from on-premise solutions to cloud-based subscriptions. Of course, this evolution has also had a significant effect on the broader business landscape.

The SaaS model has resulted in more predictability in sales, but it has also reduced gross profits. This, in turn, has led to a need for collaborative ecosystems to share resources and create a more comprehensive value proposition for customers.

Measuring Partnership Health With KPIs

Clearly defined key performance indicators (KPIs) are vital for partnerships leaders hoping to gauge the performance of their partnerships. However, these indicators should not be set in stone—Christopher said the priorities of a company’s partnership program will naturally shift as the business and its partnerships mature. Instead, partnerships pros can benefit from following a phased approach with their KPIs.

According to Christopher, these experts should:

  • Begin by focusing on KPIs related to partner recruitment/enablement
  • Move on to lead generation and pipeline development-related metrics as their program develops
  • Ultimately transition to transactional business KPIs

Protect Your Ecosystem With Help From Firneo

Though it’s all too common for business ecosystems to fall apart, partnerships leaders can still beat the odds if they know what they’re doing. By applying strategic thinking to their ecosystem, choosing the right partners, and understanding whether their company is a “star” or “planet,” partnerships pros can establish an ecosystem that meets the needs of their company, their partners, and their customers.

But like any other element of partnership management, building and maintaining partner ecosystems can be more challenging than you might think. To keep these ecosystems running smoothly, you’ll need all the knowledge you can get—and Firneo can help. Learn more about building a partner ecosystem that will stand the test of time by signing up for our Mastering Partnerships Strategy program today!

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