The partner ecosystem management conundrum

Partner ecosystems are not a novel concept. In fact, many CSPs have built networks of interdependent relationships in today’s digital world. This shift among CSPs to an ecosystem-based approach has been driven by the need to accelerate B2B2X digital expansion, with the telecoms industry largely in agreement that a greater focus on the B2B sector will be critical to sales and revenue growth.

Behind that change in strategy is a need to offer customers an experience or solution vs products and services, at a greater pace and scale. To do so, CSPs must master new technologies such as AI, IoT, robotics and Edge, to build and offer solutions that meet customer needs. Partnerships have become critical to that evolution. In one industry survey, 72% of CSP respondents said that they would need to work with partners to develop new AI capabilities if they were to successfully leverage AI innovation and offer new services. And rightly so, as CSPs can’t go it alone. Very few have the in-house skills to be able to develop their own solutions, whether that’s AI-enabled applications, smart agriculture or immersive reality experiences for education.

But growing a partner ecosystem and working with more partners won’t solely deliver growth and sales in B2B. As CSPs work with more partners to support their customers’ expectations, there is growing pressure on IT divisions, product managers and procurement to provide processes that automate partner management and cater to partner diversity. Fundamentally, the mechanisms for orchestrating partnerships, growing solutions portfolios and accelerating commercialization must change.

How partner management has changed

Traditionally, CSPs’ partner management techniques were designed to facilitate linear relationships between CSPs and a vendor or CSPs and a reseller. This was fine for around five to seven partners, all managed manually using spreadsheets. But times have changed quickly. Today, CSPs report needing to manage and orchestrate hundreds, or even thousands of partners, which requires entirely new levels of automation.

Yes, diversity in products and partnerships are absolutely critical but, so too is a fast and streamlined process that supports collaboration across diverse types and sizes of partners including solutions partners, go-to-market channel partners, resellers, hyperscalers, start-ups, network providers, other CSPs and many more.

Traditional CSPs have worked with handful of partners, often in similar size and structure to CSPs, and therefore could tolerate long procurement security and IT qualifications processes. However, when CSPs needs to collaborate with diverse types and size of partners and grow from handful of partners to hundreds and thousands this is not sustainable. If CSPs cannot move beyond their archaic onboarding and management processes, then they will experience delays and operational inefficiencies in taking new solutions to market. A process that worked for a few, does not fit many. And customers won’t wait as competitors will be able to offer solutions that meet their needs more quickly.

CSPs’ existing communications tools are also limited, with gaps becoming more pronounced as the number of partners grows, leading to poor collaboration and partner engagement. Inconsistent commercial models also lack flexibility which makes it difficult to adapt to diverse commercial arrangements.

It’s worth pointing to CSPs that have remediated this issue and seen success as a result. Odido, one of the largest operators in the Netherlands, onboarded 40 partners seamlessly to monetize and orchestrate partner offerings at scale, helping to drive new revenues from the growth in demand for B2B2X solutions. It automated its existing manual, labor intensive processes to increase operational efficiencies and accelerate service delivery times. By starting small and scaling partnerships as they grow, the CSP is benefiting from a reformed approach to co-creating and co-selling solutions together with its partners.

Relationships to revenues

While getting partner management right is a key priority for CSPs, so too is adapting how solutions are built and sold. B2B customers now want to buy solutions via digital sales channels. This means CSPs must then be able to rapidly develop solutions with partners, onboard and sell through digital channels, automate the orchestration and monetization of processes, and ultimately make it extremely easy for their customers to buy and trial new solutions. Digital marketplaces provide an elegant solution to this challenge.

IDC identified that B2B digital marketplaces are a game-changer for CSPs looking to optimize their operations, expand their reach, and deliver exceptional value to customers. Enterprises want to consume complex, relevant solutions without having to manage the technical implementation and adoption themselves. Crucially, they would like to be able to turn to their CSP partners for a solution.

Fundamentally, B2B digital marketplaces are key as they position the CSP as the trusted technology partner, capable of delivering solutions together with partners that meet customer needs. The marketplace approach is also important in making the buying process frictionless. And it works both ways. Easier buying for their customers means easier selling for CSPs.

With the right commerce model, CSPs ensure the automation of procurement processes, order fulfilment, and billing, reducing manual intervention and minimizing errors and operational costs. Not only does this make buying and selling seamless, but CSPs can enhance their efficiency and turn partner relationships into new revenues faster.

Japan’s NTT DOCOMO adopted a marketplace model to underpin the co-creation of solutions with partners to achieve cost-effective delivery of digital services to enterprise and SME customers. Operating revenue for DOCOMO in enterprise grew 4.2% at the end of its last financial year and operating profit was up 14.7%. Several years ago, DOCOMO refocused its strategy to stymie challenges with its traditional connectivity business. It has gone on to see year-on-year improvements following a greater focus on enterprise and the deployment of an SME marketplace. It demonstrates that delivering a diverse portfolio of solutions with partners to improve how enterprises do business is a fundamental opportunity that CSPs must seize.

As CSPs grow their ecosystems they must be focused on optimizing partner management, eliminating redundant siloes and consolidating partners onto a unified platform, serving as a transformative catalyst for the industry. The days of traditional partner management are numbered, making way for more dynamic and scalable solutions.

This is the first article in a two-part series. We have explored the partner management conundrum that CSPs face and looked at how commercial models must change to accommodate a growth in appetite for digital channels and a single platform for all technology solutions needs. In the second article, we will delve deeper into partner orchestration, the key mechanism that will transform partner management and provide CSPs will the tools they need to navigate this new era of collaboration and drive business growth.

Angus Ward is the CEO of Beyond Now, bringing 30 years of consulting and solutions experience to his role, supporting organizations across multiple industries to shape strategies and adopt platform-based business and operating models with differentiating partner ecosystems. He became CEO in 2017, after championing the creation of the business as part of BearingPoint Capital. Under his leadership, the company has transformed from a service-based entity to a SaaS-based technology company, expanding into ecosystem orchestration platform and digital marketplace solutions, strengthening both internal innovation and Beyond Now’s competitive advantage. In 2021, Angus led a successful management buyout backed by private investors which saw Beyond Now become an independent technology company with a vibrant global customer community of leading telecoms and technology organizations.