Ecosystem management – A new category that is redefining how companies build, manage, monetize and scale partner ecosystems

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Executive Summary

Successful partner ecosystems can increase the economic value of enterprises, increase competitiveness, and significantly increase sales growth. But, fully achieving its potential is not that easy, and research identifies poor execution as a major obstacle. To help improve execution, software and service companies have introduced new platforms and tools. These platforms and tools solve different problems ranging from sales opportunity management to training to complex partner ecosystem management. To make sense of these products and tools, Forrester developed a new taxonomy, the Channel Software Technology Stack. One of Forrester’s categories is “Channel ecosystem management”, which IDC formally named, “Ecosystem Business Management” (EBM). Ecosystem management is unique because it goes beyond just channel activities – helping enterprises seamlessly manage different combinations of partners with different objectives over the ecosystem lifecycle. Pronto’s Ecosystem Management platform is presented as a powerful solution to help companies’ partner ecosystems reach their full potential.

Let’s first define what a Partner Ecosystem means 

In VAR Insights, Michael Dalton, Senior V.P. at Unitrends defines a partner ecosystem as;

“A community of mutually beneficial partners that are interested in achieving similar goals. Imagine the benefits to a business: open, honest two-way communication; information shared on demand and immediate response to questions.”

Now, you can say that partner ecosystems are not new. Why is there so much interest in them now?

Executives across all industries are quickly recognizing that a thriving partner ecosystem is extremely critical to innovate quickly, deliver exponential value to customers, gain access to new and critical resources and capabilities, improve competitive position, and enter new markets much faster. For example, Walmart and Instacart have partnered to compete against Amazon Whole Foods.

The scope of ecosystems has also expanded beyond sales and distribution to include manufacturing, R & D, and marketing. For example, in April 2020, Rolls Royce announced a new alliance, named Emer2gent, with initial members including Leeds Institute for Data Analytics, IBM, Google Cloud, The Data City, Truata, and ODI Leeds and is coordinated by Whitespace. It is an alliance of data analytics experts challenged with finding new, faster ways of supporting businesses and governments globally as they recover from the economic impacts of COVID-19.

IDC projects that by 2024, 90% of enterprises will utilize alliances to address customer and business requirements. Those that adopt ecosystem business models will grow 50% faster than those that don’t.

Building and scaling a thriving ecosystem is very very challenging!

To build, manage, scale, and monetize a thriving partner ecosystem is extremely complex and challenging. We all agree that information dissemination and collaboration within one organization is challenging. And there is a plethora of tools these days addressing and tackling these intra-organizational communication and collaboration issues. Now imagine the complexity associated with inter-organizational collaboration and communication! These issues range from identifying and recruiting the right partners, navigating the legal rollercoaster of partner agreements, IP sharing, building/integrating solutions, co-marketing funds, joint sales enablement, measuring shared success metrics! We are going to unpack these challenges in a separate blog. But you get to see the breadth of challenges here.

Help is here!

Software and service companies have identified the need for and developed new products and tools to help address the activities necessary to make partner ecosystems work better. It is a dizzying array of products and tools with different capabilities and outcomes to help manage partner ecosystems. There are literally hundreds of these products and tools developed by large established companies and new players. To help ecosystem leaders make sense of the products and tools, Forrester’s taxonomy of Channel Software Technology Stack serves as a guiding light.

The taxonomy’s categories and brief definitions are:

  • Partner relationship management (PRM) – Supports activities required to manage “the entire lifecycle of channel partners, including partner targeting, recruitment, onboarding, enablement, engagement, communication, development, co-selling and co-marketing providing integrations to CRM, enterprise resource planning and marketing tools.”
  • Through channel marketing automation – “It helps organize and disseminate content and supports the execution of marketing programs, campaigns, and cobranded collateral that drive partner-led demand and accelerate channel lead and pipeline volume and velocity” with a consistent brand experience.
  • Channel learning and readiness (CLR) – “Supports partner development through the administration, tracking and delivery of educational training courses and enablement resources.”
  • Channel incentive management (CIM) – “Manages design, allocation, tracking and distribution of financial incentives to the partner ecosystem.”
  • Channel data management (CDM) – “Collects, cleanses, and aggregates transactional point-of-sale and inventory data from partners and distributors in a trusted single data asset.”
  • Channel marketplaces, financials, pricing, and inventory – “Manages indirect-sales-related revenue and costs, determines the correct value of the transactions, automates key financial reporting processes, and prevents errors in payment, commissions, and rebates. Marketplaces are starting to make their mark here.”
  • Channel Ecosystem Management or IDC recently introduced the term Ecosystem Business Management – The first six categories mainly support channel co-sell and co-market activities, while the Ecosystem Management category helps enterprises seamlessly manage different combinations of partners with different objectives over the ecosystem lifecycle. Partner constituents include Strategic Alliances, Integration/Technology Partners, OEM Partners, SI Partners, Channel Partners, Referral Partners, Influencers, and others. EBMs support Co-develop, co-market, and co-sell activities.Forrester states,

    “Ecosystem management manages the influence, transaction, and retention channels across the entire customer buying journey. It supports recruitment, attribution, account and partner mapping, enablement collaboration, technology/API integrations, and overall ecosystem management covering all transacting/non-transacting and traditional and nontraditional partners.”


    This relatively new platform category of Ecosystem Management can assist partner ecosystems as they embrace real-time business dynamics and collaboration requirements.

The Need for Ecosystem Management tools and platforms

Ecosystem management tools and platforms address an unmet need as characterized by IDC. IDC noted, the primary challenge is that most of the current applications were designed for channel relationships and do not address the need and requirements of varied partner ecosystem initiatives and combinations of different functional participants, such as:

  • A consistent language and approach
  • Ability to collaborate, communicate, and plan for co-creation, co-sell, and co-service
  • Sharing and collaborating on data to generate actionable results
  • Gaining alliance and customer requirements
  • Sharing relevant and timely data, updates, and content to win deals
  • Measuring in a consistent manner for financial results and continuous improvement

These unique cloud-based digital platforms allow companies to facilitate the ongoing interactions between ecosystem partners, “by embracing real time business dynamics and collaboration requirements.”

IDC defined the characteristics and capabilities for ecosystem management platforms. They are:

Enterprise Management Characteristics and Capabilities

Alignment

  • Visibility and ability to identify existing and possible relationships

Relationship and Selection

  • Ability to offer, discover, and engage with partners to co-build, co-market, and co-sell joint solutions

Organizational

  • Ability to identify appropriate contacts and approval process
  • Evaluation and attainment 
  • Real-time data and visibility (include trends and patterns) 
  • Automated capabilities to integrate key business data from alliance and ecosystem partners
  • Interactions, contributions, measurements, and reports
  • Ability to track and report on revenue attributions, joint marketing programs, MDF (Market Development Fund) effectiveness, and alliance and ecosystem partner value
  • Partner performance and ROI analysis by alliance and ecosystem partner, geography, industry, solution, and so forth

Governance

  • Standardized shared platform 
  • Common rules of engagement 
  • Standardized evaluation and selection process

Best practices and methodology

  • Automated ecosystem engagement and operations 
  • Ability to control visibility of multiway sensitive information and related security
  • Configurable workflows and distinct business rules 
  • Common and shared tool suite 

Common Language

  • Configurable taxonomy mapping for improved communications and consistency

 

Pronto’s Ecosystem Management platform

Pronto provides a comprehensive SaaS Ecosystem Management platform-built ground up to move away from siloed and manual processes. It enables companies with complex partner ecosystems to manage and increase the business performance of partner ecosystems more effectively.

Conclusion

Achieving the full value of ecosystems can help enterprises increase their economic value. Ecosystem Management is part of a new technology stack focusing on ecosystem success across any type of relationship not just Channel relationships. Pronto’s Ecosystem Management platform helps fully leverage and unlock the cumulative and collaborative value of partner ecosystems.

If you are interested in learning more about Pronto, this market segment, our Ecosystem Management platform, and customer stories, please reach out to us at [email protected].