Partnerships, Channels & Alliances – Who Does What Exactly?

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Partnerships, Channels & Alliances – Who Does What Exactly?

As the saying goes: “In networked industrial environments, the performance of any organization is largely driven by the characteristics and structure of the network, which influence the combined behavior of its many partners, competitors, and customers.” This article on “Partners – Roles and Responsibilities of Channels and Alliances” will take you through an incredible ride of the partner ecosystem and give you valuable insights regarding channel and alliance. Keep reading until the end to understand their functionalities.

The community of Industrial technology has numerous residents, where all of them co-exist and are dependent on each other. And that is what the IT ecosystem typically looks like. Here, all suppliers and users co-exist and mutually depend on each other for survival. Nevertheless, vendors soon realized they couldn’t do anything independently. A partner was of primary importance for moving about and doing certain things. However, the combination of vendors and partners could compete only if it belonged to an ecosystem.

Besides, the success of businesses largely depends on how numerous entities within the ecosystem can work together. Their collaboration, co-development, and co-delivery also determine the business’s success. Invensis is a reputed leader in empowering numerous global businesses and organizations through high-quality back office BPO services that promote enhanced business efficiency and improved bottom line. Let’s get started.

Roles and Responsibilities of Alliances and Channels

When differentiating between channels and alliances, you need to determine their roles. For example, in the late 2000s, numerous companies realized that direct sales strategy could not yield benefits to a more considerable extent. And that is when they realized the need for establishing partners was more than essential.

For a company, a partner approach is capable of competing only if it creates an ecosystem or is a part. Besides, business success solely depends on how numerous entities within a partner ecosystem are capable of collaborating.

Some benefits of doing business and associating with partners include:

  • Expansion of markets and accessing new territory or new markets
  • Significant growth in market penetration and power
  • Enhancing supply chain market defense and protection and obtaining scalability
  • Adoption of new technology, innovation, and improving existing skills

All partner activities can be addressed as ecosystems, channels, alliances, etc. However, these are articulated differently and vary from company to company. That is why it’s pretty challenging to distinguish the partner marketplace.

Let us check how the global market understands both alliance and channel partners.

Partner Ecosystem:

The partner ecosystem can be divided into two broad distinctions. First, they are channel partners and alliance partners.

Roles and Responsibilities of Channel Partners

  • They provide transactional relationships
  • They bring forth the more significant quantitative opportunity
  • Channel Partners create economies of scale
  • They emphasize improving the supply chain or internal logistics for better project execution
  • The benefits are typically measured through volumes of business and offered discounts

Roles and Responsibilities of Alliance Partners

  • They typically have a lower transactional approach
  • Their association is dramatically measured through business benefits
  • They have an interactive approach
  • Opens new markets within a particular country
  • Has interactive approach
  • Introduces lots of qualitative opportunities
  • They typically offer innovative solutions
  • They efficiently help companies build new practices and leverage niche competencies

You must know those alliance partners are more interested in interaction-oriented activities. However, channel partners are highly interested in transaction-oriented activities.

Let us now take a quick look at the roles of channel and alliance partners within the IT ecosystem.

Channel Partners

Resellers

They usually supply IT services without making significant modifications to the end-user market.

Value Added Reseller (VAR)

These individuals have usually gained in one or more horizontal or vertical IT roles. Moreover, they efficiently help build solutions for software, hardware, and service components vendors. VARs typically have direct access to the knowledge of the client base.

Distributors

They typically sell to other channels instead of end-users. They offer support and maintenance, custom development, and training.

Also read: What are the Different Types Of Channel Partners

Alliance Partners

System Integrators

They receive a considerable part of their revenue from system integration and IT consultancy. However, their more prominent characteristic is connecting and integrating various subsystems within an IT environment. In most cases, they usually have a generic approach toward the whole IT system.

Business Consultants

They typically emphasize operational business issues within an organization. They focus on improving results with the help of technology recommendations as it’s a part of their overall business strategy.

ISVs

ISVs receive their significant revenue from making continuous sales in software licenses. These sales can be either via the cloud, direct or indirect. Eventually, business models are deliberately rising in maintenance and service revenues. Even though ISVs don’t always have direct customer ownership, they sometimes take ownership of certain products.

Top Channel Partnerships That Can Improve Your Growth Potential

Service Delivery Partners

They are not involved in selling any products or software. Instead, they provide a host of services, thereby enhancing their value to end-users. For example, service delivery partners help configure a patient management system according to the needs of cosmetic surgery clinics. From pre-sales consulting to the installation of managed services, they effectively personalize the end user’s unique needs.

These services can make the products of your company more attractive. This is usually done by increasing the value and relevance of a significant market.

Channel Value Added Resellers

Channel VARs, the well-known channel partners, are typically known as Solution Providers. This is because they take your product, including profit margin, and then deliver it to end-users. This significantly helps in adding value in numerous ways.

VARs can be regional partners specializing in a specific geographic area with an excellent customer base. Some even specialize in vertical markets like oil and gas or healthcare.

Technology Alliance Partners

Just like service delivery partners, this partnership also involves zero reselling. It deliberately brings two products together within an integrated solution. They aim to provide a technology that complements the solutions offered by you.

Cloud Service Providers

Cloud service providers don’t typically resell products but provide specific components of cloud computing. Some of them include:

  • SaaS
  • IaaS
  • PaaS

They host your cloud solutions to enhance security, speed, and flexibility. Top examples of cloud service providers include:

  • Amazon Web Services (AWS)
  • Google Cloud Services (GCS)
  • Microsoft Azure

Typically there are, in fact, BIC or Born in the Cloud providers, which offer solutions from a specific cloud provider.

High-Velocity Partners

These partners efficiently help manage the contractual and administrative challenges of selling your products. In addition, they have the expertise in managing order fulfillment on more significant transaction volumes at a relatively lower rate. As a result, you can efficiently increase sales with them while keeping your administrative costs comparatively lower.

Global System Integrators

Global system integrators help build computing systems with software, hardware, storage products, and networking from numerous vendors.

Some proficient GSIs include:

  • PwC
  • Accenture
  • IBM Global Services
  • Deloitte

These firms are extensively large and complex, and they provide multi-vendor solutions to the most prominent companies in the world. As a result, the global system integrators can efficiently help you break into the lucrative market enterprise.

Managed Service Providers

They remotely manage the IT infrastructure of a customer along with end-user systems. It is typically done under a flexible subscription model on a proactive basis. In addition, they offer processing services to reduce the burden on end-users on an ongoing basis considerably.

Original Equipment Manufacturer

Original equipment manufacturers help embed products within their solutions and sell them to end-users. Like white label partners, OEMs effectively sell the integrated solutions within their brand. Moreover, OEM partnerships allow companies to find new markets for their products. They also help them find new applications for their technology.

Embedded Partners

Better known as white label partners, they embed solutions on their own and sell them to end-users. It is typically done under the same brand. White labeling certain products is a powerful way of increasing a company’s sales. However, the cost of sales is limited and solely focused on growth.

Strategic Partners

Strategic partners are likely to fall under numerous categories, as mentioned above. However, their ability to drive considerable revenue and offer value for supporting customer strategy makes them stand out. In addition, they can fit the role of numerous partners, which have a chance of evolving.

For instance, strategic partners can deliberately help your companies expand. It also has the capability of managing services to increase the lifetime value of your consumers.

Also read: Top 10 Benefits of a Channel Partner

Why Choose Invensis as Both Your Channel and Alliance Partner?

At Invensis, we spend quality time aligning with our clients’ technological and other requirements. First, we take the initiative to appreciate each technology that our clients bring forward. Then, our experts show them practical ways to embrace and utilize it to scale and expand their business.

We know how IT management and infrastructure development are essential for all businesses. So we are happy to associate and help our clients to move a step ahead for successful growth. Invensis’ deep industry-specific expertise helps us to tailor customized back office BPO services that match your business needs. So get in touch with Invensis today to become your comprehensive alliance and channel partner solution. We promise to scale your business efficiently. We also offer services such as Finance & Accounting services, e-Commerce Support services, IT services, Call Center services, etc. to meet your business requirements.

To Conclude

The channel and alliance partners are extensively responsible for all activities incorporated by the partner community. Moreover, the kind of partner, a company requires depends entirely on how it has agreed to pursue it. Nevertheless, it will be a typical combination of alliance and channel partners.

It is best to team with one or more alliances and channel partners. Only then will it efficiently help in accelerating the growth of your company. But we recommend you not to rush. Instead, take some time to determine the best-suited partner for your business.

Frequently Asked Questions

1. What are channels and alliances?

An alliance is one or a small group of partners. And the channel consists of larger groups of partners around a single vendor.

2. What are the three distinct types of channel relationships?

The top three types of channel relationships are:

  • Distributors for transporting their products through dealers and selling them to the end customers
  • Independent dealers for retailing and selling your products
  • Independent sales representatives

3. How do alliances work?

Alliances are usually build between two or more corporations. They are typically based in their home country for a certain period. Moreover, they share ownership within the newly formed venture to maximize competitive advantages within the combined territories.

4. How can an alliance become successful?

Successful alliances usually depend on individuals’ capability on each side to work like they were employed by one. For these kinds of collaborations, team members need to be familiar with the operations of their counterparts. In addition, they include the ways of allocating resources, making decisions and sharing information.

5. Why are channels created?

Channels help bridge the gap between the producer of a product and its user. This channel is parallel irrespective of the location of the parties within the same community or different countries.

 

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