How to win with corporates

I have always held a strong belief in the outsize value of strategic partnerships. And I must confess it has been a frustrating pain to be part of and watch a lot of good intentions end in absolutely nothing.

I am by no means alone with that experience. In fact I think it’s fair to say that it’s more the rule than the exception that these partnerships between corporates and startups don’t work. The excitement at signing is almost inversely related to the feeling of frustration and banging your head against the wall, once the partnership has to be implemented to start delivering on all the promises.

But it can be done. One startup, I have worked with over the last few months, has managed to get to a winning formula, and I thought I wanted to take this opportunity to share some of my learnings from it in the hope that you might use them to improve your own prospects with getting a great return on your strategic partnerships.

The first thing to consider is whether or not what you’re doing solves a real pain that the corporate has. Yes, we all know that big corporations can struggle with innovation, but that’s not where the real potential lies. Due to the law of big numbers, it makes much more of a dent in the corporate structure, if you can help them sell more or what they are already selling.

In essence that means that if you have something that makes the corporates product better in itself or provides leads for more sales of their existing product by giving their sales people cloud cover to reengage with their customers with something new and exciting, you could have something that is very valuable to a strategic partnership. But you need to have it mapped out beforehand in order to put yourself in the strongest possible position for identifying the right partner and do the hard negotiations.

If you succeed in coming up with a partnership, the hard work truly starts. A lot of startups mistakenly think that it’s all about teaching the corporate to adapt to their more lean and efficient way of doing things, but I honestly don’t think that’s the case. What I see working is in fact more the opposite; that the more you can factor in how they work in your own process and be open, transparent and accountable about it, the easier it will be for the corporate to integrate you and your product in their offering – which is essentially the only recipe for commercial success with a corporate.

Finally, you need to ensure that incentives are aligned. No matter what the corporate might tell you, its a matter of fact that they are ruled by objectives. That also means that key stakeholders bonus plans are tied to objectives, and they will do whatever they can to succeed with those in order to get bonuses and promotions. Nothing else will really be touched. So be damn sure you understand their objectives, their KPIs and bonus targets, and do whatever you can to slot into that in the simplest possible way. Make it super easy for them to engage – the less they have to think about it the better – and you’ll be in a good position to achieve success.

Does all of the above mean that you always need to dance to the corporates tune? Well, if you want to succeed with a strategic partnership centered around marketing and sales with a big corporate, I think the answer is yes. The balance of power isn’t in your favor, and the only thing you get from insisting you’re equals is…nothing. Then it’s much better to just eat humble pie, focus on the end goal of making things work and making a solid profit. And then stick to the formula.

That should enable you to consider frustrations over failed strategic partnerships a thing of the past.

(Photo by krakenimages on Unsplash)

Have you got a sales quota?

The thing that truly separates a corporate job from a job at the startup is the chance to have an outsized impact on solving a problem for customers. More often than not the distance between problem, potential solution and the ability to get that solution in front of customers to test out is way short for a startup than for a corporate.

But there is also another thing that separates the two. And it’s one which is directly linked to the above discussion about impact. It is the opportunity to see outsized returns on the investment of time and ressources you put into succeeding.

Having an incentive programme at a startup is pretty normal. It’s a part of the overall compensation and incentive plan in the company, which helps to ensure that the right talent can be attracted and that people stay motivated outside what their immediate role requires of them. But being part of an incentive programme is perhaps not enough. Perhaps we need to take it one step further.

How about we talk about assigning measurable sales targets or quotas outside of the sales team? What would happen if we started putting the same kind of targets on fx product peoples backs as we do with sales? Would that make a difference for the product, it’s ability to delight customers and – following on from that – generate sales? Perhaps it would.

It has always seemed quite odd to me that a lot of startups despite having a shared stated vision and mission seldom follow it up by assigning specific market facing targets but instead confine these to sales. I know that all departments have their own set of internal KPIs they’re working hard to achieve, but since you could easily argue that startup success is impossible without market facing goals, it makes little sense that they are not evenly distributed across the organisation.

Of course sales should always be accountable for turning leads into deals and revenue that can be booked. But sinde the core foundation of sales is the availability of an attractive product that delivers value above and beyond what customers pay for it, it makes perfect sense to assign the same kind of quotas to both product and R&D. After all, we all have a shared interest in becoming a success in the market place.

Naturally, the first couple of arguments against this line of thought is that people outside sales are not exactly motivated by doing sales (hence the reason they chose a different line of work) and they don’t always feel empowered to influence how and under which terms the product is being sold to customers. I have full sympathy for these arguments, but I think there are ways to work around it.

First of all, it should be ensured that whatever sales quota is being assigned outside sales is directly related to the overall vision and mission of the startup. It should not only be about assigning a dollar amount or a number of installs. It should be set up in a way that it encompasses the storytelling about what it is, you’re trying to achieve – big picture style. That way a quota essentially becomes a recurring reminder of what you’re doing, who you’re doing it for, and how you’re progressing towards achieving your ambition.

Second, it should also be ensured that there are boundaries for how sales sell the product. Especially if it’s done through reps. No opportunity for promising customers anything other than what’s already in the product. No opportunity to put extra workload on the teams back at the office for coming up with new features or a new take on a feature just to satisfy an painful customer. Sales has to show some respect here for the team members who have agreed to take on some objectives which don’t come natural to them.

After all it is a team effort, where everybody help each other out, and where there is total transparency about how things are going, and how successful we all are. Wasn’t that what was agreed in the first place, when the startup was founded and the first team members started to join? That you’re in this together in other to succeed with a higher purpose?

Of course it was. Or should be, at least. And viewed from that lens it isn’t awkward to put sales quotas on people outside the sales team. Quite the contrary; it makes total sense in order to ensure the alignment against vision and mission of everybody on the team.

(Photo by Norbert Braun on Unsplash)

The corporate talent gift

In the startup environment it is not uncommon to frown upon people with experience from the corporate world. They are either too old, too conservative, to0 expensive or just too corporate to make it in the startup world.

But is this really true? I don’t think so.

In fact I think the right corporate profile is a gift to any startup. Why? Because corporate profiles with an interest in startups often come with two attributes, you could easily slot into the team.

First of all, if they are interested in startups, they’re likely to be more entrepreneurial than most corporate profiles in their approach to getting things done. They will likely have years of experience navigating opposition all around them from the big incumbents and with that also experience in how to get things done despite serious adversity.

That experience is gold for your startup.

Second, they are also likely to know a lot about spotting and managing risk. Everybody knows that in corporate life, the riskiest path to choose is the one challenging the norms. And unless your ambition is a fast forced exit, you will need to manage that and perform in order to stay alive in the organization. That takes some serious risk mitigation and sometimes even almost near death-experiences.

That experience is crucial to your startup.

Having said that there is one type of corporate profile that you should probably be wary off joining your team:

The one whose main motivation is a big personal payday courtesy of your startup.

While they may be willing to work hard at achieving it, having financial compensation as a sole major motivation can backfire. Because corporate profiles with that motivation will tend to do what serves their own needs and career progressions best, and that might not necessarily be what’s in your or your startups best interest.

So be on the lookout for that and be very aware of doing your personal due diligence, when you consider onboarding a profile like that for a specific role.

Other than that, just go for the corporate experience. Look at it this way: Many of these people are talents that big corporates have essentially paid to ‘educate’ to get the experience that your startup will benefit from.

That’s an awesome deal way too good to just keep lying around.

(Photo by Hunters Race on Unsplash)

The new WFH opportunity

What will the Work-from-home (WFH) movement mean for local economic growth prospects? And for startups looking to facilitate this new way of basically organizing the economy?

Futurist Thomas Frey has an interesting take, in which he basically says that while flexibility for people and corporations will be at an all time high, the demands on investment in infrastructure is going to be gigantic.

Of course he is referring to the investments in bandwidth, support infrastructure (incl. education) etc., but my bet is that the investment opportunity in more soft components of these emerging ecosystems is going to be just as massive.

Many will doubtless see the WFH future as the domain of the big tech companies. But I think there are countless opportunities for startups to come in, seize opportunities to make this new reality ‘gel’ better and build some very substantial businesses from it.

I especielly think this is going to hold true as the big corporations by default probably are the least suited towards figuring out what a new flexible workday outside the corporate controlled office should look and feel like. Here the more nimble, creative players should have a very good chance of carving something out (before they are eventually acquired by the big players, of course).

We may indeed be on the brink of a golden age for digital tools and services supporting a remote economy. The question is who are going to go after it, and what kind of products and services will end up winning in this space.

Personally, I can’t wait to find out.

(Photo by Jason Strull on Unsplash)

The dangers of ‘digitalization’

The Danish Management Society‘s new focus on “Digital Reshaping” – whatever that wording means – made me think;

Whenever somebody talks about the need to ‘digitalize’ products or processes in an old industry company, you as a digital expert should be quite alert. Perhaps even worried.

Because what does the phrase really mean?

I will tell you what it seldom means;

It seldom means that the company in question is looking to question every single process and product it has in order to ask itself questions like “Is this still relevant?”, “Does the product serve a clear need in the market?” and “Have we REALLY understood what it means to make this a success in the current and future market?”. And make the necessary brutal decisions the answers demand.

It seldom means that the company is looking to change it’s entire operating model to embrace the uncertainty of a fast moving market and favor smaller, nimbler experiments as a way of understanding the need in the market before pushing for the big product delivery. And it never means a higher tolerance – embrace even – of risk. Or even a longer time horizon to get things right.

And it seldom means being really ambitious about the people you get on board and – crucially – the mandate you give them to actually make the needed changes happen and – hopefully – put the company on a better trajectory.

All of the above are in my humble opinion key elements for actually making the necessary things happen that will change the trajectory of the company into something better aligned with the needs of the current and future market and customers.

Of course you could be in luck. But alas, you will seldom see these things. What you will see when companies look to ‘digitalize’, though, is;

Doing more of the same but in a slightly different way. Typically by investing in expensive systems from convincing vendors and trying to operate them even though they are often overblown compared to the value they end up delivering to your company.

More of the ‘big bang’ releases that are being touted – using various fancy words – as ‘transformative’ or even downright ‘disruptive’ (which they never are, ed.) that end up failing in spectacular and (sometimes) even depressing ways.

The same old guard of people sitting there making all the decisions lacking the necessary insight into the depths of the matter and what needs to be done while confirming to each other that they have long ago figured this out. And the ruthless of identifying the scapegoat for failure and weeding out of everybody else, who think and try to act in a different way.

The end result?

More blindfolded investment. More wasted investment. More convenient scapegoats when things again don’t go according to the grand ol’ plan.

And very little real change.

So beware. And demand all the right answers to the proper questions, before you get involved.

(Photo: Pixabay.com)

It takes a team to win

Great teams succeed together. A team full of individual stars lacking coordination and communication between the various positions fail no matter how good and expensive they individually are.

If those things are true in sports, does it come as a surprise that it goes for corporate innovation as well? A great football manager knows that in order to be successful with the team you recruit for players who fit the team and style of play centered around a shared philosophy for how the team should play – and win.

Greg Satell does a good job of noting the reasons why most corporate innovation teams fail. I think in many cases it can be boilt down to team – or the lack thereoff. Instead of building new teams, you should be focusing on augmenting the strengths you already have that have made your company successful so far. Succeeding in innovation is and always will be a team effort.

(Photo: Pixabay.com)