Channel partnerships are not meant to fail, but too often, many do. Software and services providers in the investment management space have good reasons to work together, but a successful partnership requires a solid foundation and real commitment.
As a vendor in the investment management industry, you know how hard it is to build your business.
And you’re likely in one of these situations, or a mix of them:
These are common challenges investment management software and services providers face, and partnerships with vendors that complement your offerings are a solution.
By establishing channel partnerships, good things can happen for both sides:
Still, 60%-65% of partnerships fail, according to entrepreneur and author Mark Sochan in his book, “The Art of Strategic Partnering.”
Below are some of the reasons why they fail.
Both sides enter a partnership knowing they want something out of it, but they don’t explicitly state what those goals should be. For example:
Without clearly defined expectations, it’s just a partnership on paper and in theory.
Misunderstanding and conflict between the parties will also occur.
This ties in with a lack of defined expectations.
You don’t establish a partnership for nothing, and the reason partnerships can be so beneficial is because of their potential to boost revenue.
And when both sides agree on what they expect or strive for in revenue, they know how much effort they need to put in.
If both sides cannot quantify the revenues expected, efforts will forever be lackluster and haphazard.
One or both sides may have said they would do X things with and for each other, but for a number of reasons, nothing actually happens.
And the lack of progress may not have been intentional. Rather, existing obligations and workloads within one’s own business occupies so much of their time before they can put more effort into the partnership.
The expectations and commitment were all there, but the strategy itself didn’t work. There could’ve been a misalignment between target market and service offerings, or the messaging to relevant audiences was off.
Or it could’ve been a great strategy, poorly executed. There might’ve been inconsistent and insufficient efforts on both sides to make it work.
Along the lines of poor strategy and execution, things can go wrong when one party doesn’t fully understand the other’s offering or value proposition.
“Left to their own devices,” one side will inaccurately describe their partner, which limits the appeal the prospect could’ve had in the partner and the partnership itself.
There are times when both sides will present the partnerships to their audiences through their own lens, but it’s important the partners establish a common narrative, presenting each other in ways they both agree on.
As the saying goes, it takes two to tango.
If one side clearly puts in more effort while the other side benefits more, then it’s not an equal partnership.
The partnership can also turn one-sided if one party “takes over” and dictates how it should work, serving their own interests first and foremost.
You establish a partnership, but there are times when both sides have competing interests.
It’s possible for both sides to collaborate in some areas while competing in others where they offer similar services.
Both parties need to make it clear what lines of services they will or won’t promote, and they must not take advantage of the other. For example, using the other’s connections to steal business away from the very partner that offered a helping hand.
Poor communication comes in two forms:
And the aforementioned reasons that channel partnerships fail tie in nicely to the theme of communication.
If both sides communicate regularly, so many issues could be resolved:
At Empaxis, we understand that software and services providers for the wealth and asset management industry need support from complementary vendors.
Partnerships open doors otherwise not available to vendors individually, and equally important, partnerships benefit the investment firms that rely on the synergies between the vendors.
That is why we actively promote and participate in partnerships.
Empaxis has a history of successful collaborations with software, service providers, and consultants in the investment management space.
Vendors leverage us for our deep expertise in middle- and back-office operations spanning two decades, as well as our systems integration/digital transformation and finance and accounting capabilities.
Along those lines, we have hands-on, proven experience building out target operating models for investment firms and seeing them implemented successfully.
By establishing this partnership ecosystem, everybody wins. For Empaxis, when we have a network of reliable industry partners, we provide even better service for investment firms by having resources available via the partnerships ready, while Empaxis ensure and oversees successful delivery.
Through this approach, vendors that partner with Empaxis can:
Visit our partnerships page and see how other technology and service providers benefit with Empaxis.
You can also contact us, and we’ll have a great discussion around not only how our two sides can mutually benefit, but also how investment firms get better servicing for their operation when two parties join forces.
Channel partnerships are not meant to fail; they’re supposed to thrive… and they thrive with Empaxis.
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