We can do better than "Frenemies"
In the world of B2B enterprise SaaS, most companies provide clients with some level of paid professional services. At a minimum, it usually involves new customer onboarding and implementation. For SaaS companies experiencing or preparing for rapid growth, they often look to create a partner network to supplement their in-house Professional Services.
Creating a partner network for services delivery can unlock the ability for sustainable exponential customer growth; all without disrupting the capacity to onboard and service customers. In fact, for some SaaS businesses, (which are successful in developing a thriving, fully enabled partner ecosystem) they often offload all Professional Services to this partner network.
How to navigate the relationship between in-house Professional Services and a partner service network can be a delicate task. With the right approach, you can develop a harmonious, symbiotic relationship and avoid a competitive and contentious relationship.
When Gainsight (a leading customer success software firm) entered the period of rapid growth, they set out to optimize their relationship with partners while balancing the performance of their in-house Professional Services team. One of the strategic partners they formed a great relationship with was Coastal Cloud. I had a chance to speak with Peter Wride, the Sr. Director of Professional Services at Gainsight and Jamey Jeff, a former Managing Director at Coastal Cloud (now CCO at Cortex Building Intelligence) and asked them how they made a partnership that worked for everyone.
Picking the right partners
How did you pick the right partners? How did you make sure it was a good fit?
Peter@Gainsight: Our product offering served an enterprise market so services were part of our DNA from day one. We had looked at the Salesforce model, (limited to no services and with everything sent to partners) and understood they initially started with services as well. As rapid growth occurred, Salesforce knew that they couldn't grow the services at the speed of the customer growth. So we had to have a similar plan. We initially looked at the big four and quickly realized that for them to devote effort and focus into a practice for our product, we needed to be much bigger. So we evaluated our channel sales network by the strength of relationships and started with a few partners with 3-4 people trained up to provide services at each partner. We knew that starting a new practice around Gainsight was a big investment for these partners, so we chose the right amount where we could give them enough business to make it worthwhile.
Jamey@Coastal Cloud: I had implemented many customer success platforms in the past and saw a need in the market for an outside agency to help these CS vendors. I had a relationship with Nick Mehta the CEO of Gainsight and told him that there was a need to have solid implementation partners in the market. He agreed and thought this would go a long way to address the challenges he had witnessed. So Nick introduced me to the partner leader and we talked about what Coastal Cloud’s market focus would be (Mid market to low enterprise). Because you have to think about how much pipeline a vendor can provide to an implementation partner. If there isn't enough, the partner will think "I can't build a practice around this." With Gainsight, we knew they were growing very fast in a fast growing space. Capacity would eventually become very constrained so it was easier to use a partner. With that commitment and growth forecasted, it was a clear decision for Coastal Cloud to come onboard.
Client Experience
How did you ensure that the delivery expectations would be met and the end customers would have a great experience?
Peter@Gainsight: For all of our service delivery partners, we have a Partner Manager that keeps eyes on all of their projects and keeps them enabled on our products and processes. We also have a robust certification process that all partner delivery practitioners go through. When we outsource services, we are selective on the work that we sub out. For example, we will often outsource some solution or technical architecture, but we’ll keep all of the project management and strategic advisory services in house.
Jamey@Coastal Cloud: At Coastal Cloud, we hired CS practitioners. People could go into a prospect with Gainsight Account Executive and say "I've been in your shoes, here’s what went well and what went wrong and what we'll ensure we avoid." They were able to predict what may be the bumps along the way and how to avoid them. But since this was a specific technology with a well defined implementation process, we knew we had to marry our methodologies. We were early trainees of the Gainsight admin certification process. There was vetting of our team, rigorous training and strict certification criteria. When projects first started, there was shadowing by the Gainsight team with feedback and coaching. The Partner Manager role also helped by shadowing, tracking key milestones and holding weekly status calls. When projects were complete, Gainsight would send a NPS assessment to the customer for feedback on Coastal Cloud.
Sales Enablement
How did you ensure that the Gainsight team understood how and when to bring in a specific partner vs. using in-house Professional Services?
Peter@Gainsight: From day one it was important to create strong rules of engagement where our in-house Professional Services team wouldn't give a bid if a partner had already given a bid. To make things as straightforward as possible, the same Account Executive always sold with the same services partner. In fact, our EMEA partner even worked out of the same Gainsight office. We also created rules for ambiguity and one off situations. We established that partners got the first right of refusal in their segment or if they brought in the prospect. If there was no open opportunity for a given prospect in that moment, whoever brought them in would be able to service the account.
Jamey@Coastal Cloud: If you don't sufficiently enable the Account Executives on "here's what we should keep internal and here's what we should send to partners" it gets challenging. Prospects say "do I have to use a partner?" and Account Executives don't know what to say. You have to create rules of engagement. You have to know which partner is going to get the leads, etc. Gainsight did a good job of creating protocols for what partner was assigned to which prospects. We took it a step further. We wanted to make the experience for the Gainsight Account Executives as easy as possible too. So we also trained on their sales process and how in-house services were scoped, run through the deal desk, etc. We knew what all of their Account Executives were accustomed to and made it easy for them to identify a prospect need that Gainsight didn't have a strong offering for. For example, since Gainsight was integrated with Salesforce, and since Coastal Cloud was also a platinum Salesforce partner, we could improve Gainsight installs by getting Salesforce ready and optimized in advance (solve everything at once). Then we built our offerings to be similar to the in-house offerings they were used to selling. We would start with a familiar offering and add our own secret sauce. So sales could easily describe what it was.
Planning the future
Clearly both Peter and Jamey worked hard to guarantee that the vendor-partner relationship was mutually beneficial and symbiotic. But once a partnership is established, the work isn’t done. Peter and Gainsight want to ensure that there is long term viability and growth for the partner network. So Gainsight considers their partners in their forecasts and planning. Gainsight plans on certain percentage of bookings being sent to partners. They use that data for their own capacity planning, but they also transparently share it with the partner network for their own staffing concerns.
The Gainsight & Coastal Cloud story is a good reminder to organisations that have a strong need for Professional Services to support their products. The only way to achieve scalability is to create a robust, well planned, well orchestrated, symbiotic partner network. Comment below with your vendor-partner stories and best practices.
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