Another popular question we get as we build partner strategies and programs for clients is, “How many partners DO I need?”. It’s a great question, and answering it correctly can make or break a partner initiative.
Recruiting is a necessary first step for all new programs and one that is continuous for all healthy programs. But the velocity at which you recruit and the onboarding support that goes along with it have substantial impact on your opex costs. I wrote about the Economic Impact of Recruiting, where I said that recruiting is not your answer to all your problems. It is possible to do too much of it. How do you know you have reached “Goldilocks” status? That is, not too much, not too little, but just right? Well, the answer is different for everyone, but let’s see if we can get you close.
Contrary to all our knee-jerk reactions, “as many as possible” is not a good target for recruiting, onboarding, and maintaining partners. Through recent data analysis AchieveUnite did, we discovered there is a sweet spot for sellers working with partners and for partner managers working with sellers. This tri-partner ecosystem of seller-manager-partner is a delicate balance based on – say it with me – TRUST. I write about Trusted Partner Relationships all the time. For this discussion, let’s just stick with numbers.
- A CAM/PAM person whose job is to support the relationship between the partner and your company, may be managing 10-20 commercial partnerships. If they are managing a strategic partnership, they could be dedicated to just 1. We found that the average CAM/PAM is managing 7-10 partnerships.
- A CAM/PAM is also working with an average of 7 direct sellers from their company in this tri-partnership arrangement. While this does vary from region to region, with APAC trending up (8-10:1) and Emerging Markets trending down (2-3:1), 7 is the average.
- Our research shows that a successful seller, that is one making 100% of quota or above, is working with an average of 12 different partners and 17 different sellers at those 12 partner companies. Interestingly, our research also showed the sellers that were working with the most partners, were less likely to reach quota.
So, what do all these numbers tell you? More is not necessarily better. Just like Goldilocks, you need to find the “just right” balance.
Leading a capacity planning exercise can help you gather your average sales price, the average sales cycle, and the duration of your onboarding plan. From there, you can calculate how many fully onboarded partnerships can be managed by your current infrastructure, or you can determine the infrastructure required to support the number of partnerships needed to meet your revenue numbers. Then layer in the number of sellers you have that will need to work with these partners and the partner sellers to see if you are within striking distance of “just right.”
Keep in mind that you may opt for models that are based on the partner journey, where CAM roles align with where a partner is in your journey – recruitment vs. retention for example. And virtual teams specific to enterprise opportunities will also rise to support product lines or business outcomes. In other words, you will need to be flexible and find what works for you.
So, contrary to what you might think and what others might say, no, you don’t need 10X the number of partners you have today to be successful tomorrow. In fact, doing so may overload your ecosystem and grind you to a halt. But you do need to carefully monitor the numbers to make sure you are not over-rotating on either axis (partner, channel manager, or seller). Some strong segmentation work and data analysis will confirm you are on, or close, to target.
AchieveUnite is a partner performance company built by experts with extensive leadership experience in channel strategy, program development, partner ecosystems, go-to-market models, leading edge education and management coaching. We empower companies and individuals to create value-driven, lifetime partnerships and drive transformational business results through Partner LifeTime Value®. Reach out to us to learn more!
