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The Hardest Partnership Is The One Inside Your Company

The Hardest Partnership Is The One Inside Your Company

For a conversation about partnerships, remarkably little time was spent discussing partners.

Instead, the discussion kept returning to incentives.

Redmond Orme, who has led partnership initiatives across organizations including Cisco, Oracle, SAP and Snyk, described a recurring pattern. Companies invest in partnerships expecting accelerated growth, broader market reach, and greater efficiency. Yet many of those same organizations structure partnerships as a side function rather than a company-wide capability.

Martin Scholz approached the issue from a different angle. Working primarily with earlier-stage companies, he argued that many partnership failures occur before a partner is even signed. Companies pursue recruitment targets, accumulate logos, and celebrate agreements without establishing whether there is genuine alignment between the two businesses.

What emerged from the discussion was a broader management question.

People tend to behave in accordance with the incentives surrounding them.

Partner managers recruit partners when recruitment is rewarded.

Sales teams defend territory when territory affects compensation.

Leaders focus on metrics they can easily measure.

The result is that organizations often create precisely the behavior they later complain about.

Partnerships simply make the problem easier to see.

People Follow Incentives

One of the more revealing parts of the discussion centered on partner recruitment.

On the surface, the logic appears sensible. A company wants to expand its ecosystem, so it hires partnership professionals and asks them to recruit new partners. Leadership can track progress through signed agreements, new logos added to the program, and growth in the overall ecosystem.

The problem is not that these metrics are wrong.

The problem is that they are incomplete.

Redmond described organizations where partnership teams were measured on partner acquisition because acquisition was easy to quantify. A contract had either been signed or it had not. The number could be reported. Targets could be established. Progress could be tracked.

The challenge emerges after the agreement is executed.

A partnership contract does not create value by itself. It creates the possibility of value.

The two organizations still need to align incentives, commit resources, educate teams, develop trust, identify opportunities, and determine whether there is a commercial motion that benefits both sides. Until that happens, the agreement remains largely an administrative achievement.

Martin made a related observation during the discussion. In his experience, companies frequently devote more energy to signing partners than understanding whether those partners should have been recruited in the first place.

"The biggest risk for you guys is you recruit the wrong partners."

Martin Scholz on Partnerships

That idea extends well beyond partnerships.

Organizations often assume that measurement simply records performance.

In practice, measurement influences behavior.

When recruitment becomes the primary measure of success, recruitment attracts the majority of attention.

When activation becomes the measure, behavior shifts.

When commercial outcomes become the measure, behavior shifts again.

The discussion served as a reminder that incentives rarely need to be explained to influence decisions.

People discover them quickly on their own.

@o_carlosmonteiro

The Hardest Partnership Is The One Inside Your Company Three observations from this week's EVOLVE newsletter: • Most partnership failures ... See more

Why Great Partnerships Start With Disqualification

Partnerships suffer from a structural problem that most sales organizations do not face.

A prospect that has no intention of buying will eventually disappear.

A partner that has no intention of creating value will often sign the agreement anyway.

That observation sat underneath much of Martin's commentary throughout the session. He argued that companies frequently apply sales logic to partnerships, assuming that growth in the number of signed agreements is evidence of progress. In practice, the economics are very different.

Signing a partnership agreement carries relatively little risk for the partner.

There is rarely an immediate financial commitment.

There is no implementation deadline.

There is no obligation to generate revenue.

There is no guarantee that resources will be allocated once the agreement is signed.

As a result, partnership pipelines often look healthier than they actually are.

A company may believe it has one hundred partners.

What it often has is one hundred signed agreements and a much smaller number of active commercial relationships.

Martin shared a benchmark that surprised several participants. In many partner programs, a small minority of partners generate the overwhelming majority of commercial value. The rest remain largely inactive despite formally belonging to the ecosystem.

"You don't have 100 partners. You have 100 signed agreements collecting dust on the shelf."

Martin Scholz

The implication for leadership teams extends beyond partnerships.

Growth initiatives are often evaluated through activity rather than contribution.

New hires, vendors, markets, partnerships.

Each creates a visible signal of momentum.

Determining whether value is actually being created requires a different level of discipline.

That discipline begins long before execution.

It begins with selection.

The strongest organizations are often distinguished not by what they pursue, but by what they decline to pursue.

Channel Conflict Is Usually A Leadership Problem

Few topics generated more energy during the discussion than channel conflict.

The term is widely used across technology companies. Sales teams believe partners are competing for opportunities. Partner teams believe sales teams are blocking collaboration. Marketing teams debate attribution. Revenue leaders attempt to determine where a deal originated and who should receive credit.

The debate often becomes highly operational.

Who sourced the lead? Who influenced the opportunity? Who owns the account? Who receives compensation?

Martin challenged the premise itself. His argument was that what companies describe as channel conflict is frequently a consequence of how incentives have been designed rather than an unavoidable feature of partnerships.

The observation is worth examining carefully.

A salesperson measured exclusively on individual quota behaves differently from a salesperson measured on overall company revenue.

A partner manager measured on partner-sourced opportunities behaves differently from a partner manager measured on ecosystem growth.

A marketing leader measured on attribution behaves differently from one measured on commercial outcomes.

Each person responds rationally to the system around them.

The friction appears when the organization expects collaborative behavior while rewarding local optimization.

This challenge is hardly unique to partnerships.

Large organizations frequently encourage cross-functional collaboration in principle while evaluating performance through highly functional metrics. The resulting tension is often interpreted as a cultural issue when it is, at least in part, a structural one.

Redmond approached the same issue from a different angle. He noted that successful partnerships rarely sit within a single department. Sales, marketing, product, customer success, legal, finance, and operations often need to participate if a partnership is going to generate meaningful value.

That creates a management challenge.

The more functions involved, the greater the need for alignment.

The greater the need for alignment, the more important incentives become.

"The only thing which exists are broken incentive systems."

Whether one agrees entirely with Martin's conclusion is almost beside the point.

The comment forces a useful question.

When collaboration breaks down inside an organization, how often is the problem capability, and how often is it design?

Many leadership teams spend considerable time discussing culture.

Fewer spend the same amount of time examining the systems that shape behavior every day.

Organizations Get The Behavior They Reward

One reason partnership discussions become so valuable is that they expose organizational dynamics that are otherwise difficult to observe.

A partnership cannot succeed through the efforts of a single department. Sales, marketing, product, customer success, finance, and legal may all influence the outcome. Some create demand. Others support implementation. Others determine how quickly opportunities move from discussion to execution.

The economics of the relationship depend on coordinated behavior across multiple functions. When that coordination exists, partnerships can become meaningful growth engines. When it does not, the limitations become visible quickly.

This is partly why partnerships often reveal weaknesses that already existed inside the organization.Partnerships often become the place where underlying organizational issues surface first.

Few initiatives require as much coordination across different functions. Sales, marketing, product, customer success, finance, and legal all influence whether a partnership succeeds. As a result, problems that remain hidden elsewhere become visible quickly.

A disagreement over ownership can slow execution. Competing priorities can stall a promising opportunity. A partner may receive enthusiastic support from one team and indifference from another. None of these situations are unusual. They are what happens when an organization asks people to collaborate while measuring success through different lenses.

The discussion repeatedly returned to incentives because incentives sit underneath all of these situations. They influence where attention is directed, how resources are allocated, and which trade-offs people are willing to make.

Consider how frequently leadership teams ask for collaboration.

The expectation is understandable. Modern organizations are increasingly specialized, and few strategic initiatives can be executed successfully by a single function acting alone.

Collaboration, however, is rarely free. It requires teams to share information, coordinate priorities, and occasionally subordinate local objectives to broader organizational goals. Those trade-offs become much easier when the organization rewards the outcome being pursued.

This is one reason incentive design deserves more attention than it typically receives. Incentives influence where people direct their time, how they allocate resources, and which opportunities receive priority. Their effects are often less visible than culture or leadership, but they can be just as consequential over time

"People do what they're compensated to do."

Every organization eventually discovers that the systems used to measure success become the systems people learn to navigate.

People pay attention to what is rewarded, invest effort where progress is recognized, and allocate resources toward the outcomes that influence performance. Over time, those behaviors compound across teams and functions.

The results are rarely accidental. More often, they reflect the priorities the organization chose to reinforce.

What Leaders Often Underestimate

Redmond described partnerships as a team sport. The observation reflects the number of functions involved in making a partnership successful. Sales may identify opportunities, product teams may support integrations, marketing may create awareness, and customer success may influence adoption.

The difficulty is that each of those functions is typically measured differently. Revenue teams focus on quota attainment. Product teams focus on delivery. Marketing teams focus on demand generation. Customer success teams focus on retention and adoption.

Coordination becomes easier when those objectives reinforce one another. It becomes harder when progress for one team depends on sacrifices from another.

This is why incentive design appeared so frequently throughout the discussion. Partnerships require organizations to coordinate resources across multiple functions. The quality of that coordination is influenced by the systems used to evaluate success.

The Question Beneath The Partnership Discussion

As the conversation progressed, the focus gradually moved away from partnerships themselves.

Partnerships provided a useful environment in which to observe how organizations allocate resources, coordinate activity, and manage competing priorities.

That is partly because successful partnerships depend on multiple functions working together over an extended period of time. Sales may create opportunities, product teams may support integrations, marketing may contribute demand, and customer success may influence adoption. The commercial outcome rarely belongs to a single team.

Under those conditions, incentive design becomes increasingly important.

Each function operates under its own objectives, constraints, and performance measures. People naturally devote attention to the outcomes used to evaluate success. Resources follow similar patterns. Teams invest effort where progress is recognized and rewarded.

Over time, those decisions accumulate.

Opportunities receive support or remain underfunded.

Partnerships become active or remain dormant.

Collaboration becomes easier or more difficult.

The resulting outcomes often appear operational on the surface. A delayed integration, an inactive partner, or a dispute over ownership may be treated as isolated events. Viewed over a longer period, they frequently reveal how an organization coordinates work across functions.

Martin and Redmond approached the subject from different directions, yet both repeatedly returned to incentives, alignment, and organizational design. Partner recruitment, activation, ownership, and collaboration all depend on how people are measured and how success is defined.

"You get what you incentivize."

The statement appeared repeatedly throughout the discussion because it explains much of the behavior organizations encounter. People learn how success is measured. They adapt accordingly. The results that follow often reflect those measurements more closely than the intentions expressed in planning sessions or leadership meetings.

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