Note: this is the latest in our Partnerships 101 series. You can read the others below:
- Partnerships 101: What's a PRM and should I use one?
- Partnerships 101: How to Launch a Tech Partnership Program
- Partnerships 101: How to Execute a Co-Marketing Motion to the Right People, Every Time
- Partnerships 101: Account Mapping. How to (Finally) Do It Without Giant, Cumbersome Spreadsheets
- Partnerships 101: What is Cross-Selling?
System integrators. The name itself can sound a bit Matrix-y without the right context.
But system integrators (SIs) significantly impact the conversions and retention rates for their independent software (ISV) partners. In fact, HubSpot predicts bringing in more than $18 billion from its solution (think: SIs) and app partners over the next four years, and 95% of Microsoft’s revenue flows from its partners.
The business impact SIs effect for their partners is game-changing, but understanding how to partner with them (or what they are) isn’t exactly the easiest thing to Google. So, we did the research for you. Let’s start with a brief explainer of what SIs are and why they’re important.
What to expect:
- What Are System Integrators, and How Do They Benefit Clients?
- How System Integrators Work With ISV Partners
- Examples of System Integrators
- Should You Partner With a System Integrator?
- Tips for Partnering With a System Integrator
What Are System Integrators, and How Do They Benefit Clients?
An SI (often referred to as a “solution” or “consulting” partner) is a type of channel partner that audits, leads, and manages improvements to a client’s tech stack and business processes. Basically, they tell companies what they can be doing better and take care of all of the changes once the company gives the go ahead. This includes scenarios like:
- When the client is looking to optimize its workflows and systems across departments as it scales
- When the client is interested in optimizing a specific department, function, or tool (like hiring an SI to evaluate and improve marketing ROI)
All SIs are channel partners, but not all channel partners are SIs.
How System integrators Work With ISV Partners
SIs often partner with independent software vendors (ISVs) as the products they use to make improvements for the client. For example: an SI might partner with Outreach.io if they’re trying to help the client’s sales team engage more prospects.
SIs often sell their ISV partners’ products in the early stages of the sales cycle and then hand the prospect off to their ISV partner to sign the contract and provide direct payment for the ISV’s product. Once the deal is signed, the SI partner helps the client adopt the product and drive value for the remainder of the customer lifecycle. Depending on the relationship between the SI and the ISV, the ISV’s professional services team may provide additional support to the client in tandem with the SI to help the client with specific use cases.
If the client’s relationship with the SI ends, the client can continue to use the ISV’s product since the contract for the product remains with the ISV. Alternatively, if the client chooses to no longer use the ISV’s product, the SI could recommend a different product to suit the client’s particular needs.
Since SIs often develop custom-tailored hardware or applications for their customers, SIs are often confused with value-added resellers (VARs). VARs customize their ISV partners' products to create additional value, typically for a single product or use case (think: Roketto, a marketing services agency, that sells HubSpot to its clients with their ongoing support and services), and then end the engagement. SIs have an ongoing relationship and often provide consultative services and any number of improvements to the client’s technology and workflows.
SIs can be highly specialized. If you scroll through an SI’s LinkedIn database of employees, you’ll see roles like “climate change and sustainability expert,” “cloud architect,” “Managing Director, P&L” (Profit and Loss), and “data engineering and visualization.”
SIs hire employees who have experience with their partners’ software and train employees to become strategists who can develop new ways to use their partners’ software for a variety of clients. SIs build these consultative services into their client fees, while clients typically pay the ISV directly for the usage of their products.
SIs often show their success through case studies featuring their ISV partners’ products and their expertise through original research, industry-specific surveys, and other business insights. These insights show potential clients how they could and should be adjusting their business to stay ahead of changes in work and technology, all with the goal of outdoing the competition.
A few examples of SI success stories:
PWC’s success story featuring its “cloud and digital strategy” improvements for AXS Map
Atos’s success story for client Acea Energia with ISV partner SAP
Accenture’s success story improving automation, data, and analytics for its investment banking client
Examples of System Integrators
- Centric breaks its specialities down into two categories: business consulting and technology services. Centric’s business services include improving customer experience or services through accelerators and incubators that bring an initial concept to launch. Its technology services include driving automation and better visibility into data (“Data & Analytics”) and helping clients maximize their workflows and results from platforms like Microsoft, Oracle, and Salesforce. They’ve partnered with the three aforementioned ISVs and others like IBM, AWS, Netsuite.
- Atos specializes in advanced computing, customer experience, decarbonization, Internet of Things (IoT), and more. They’ve partnered with ISVs like SAP, Oracle, and Cloudera.
- PWC specializes in audit and assurance, cloud and digital, cybersecurity, financial statement audits, and more. They’ve partnered with ISVs like Microsoft, Oracle, Veeva Systems, and Qlik.
- Upper Sigma is a boutique Salesforce SI that helps businesses in the legal, financial, and professional services space audit and optimize their workflows and results from Salesforce. Upper Sigma is an example of an SI that has also developed its own ISV product. Upper Sigma can partner with ISVs to implement their ISV partners’ products for clients, and they can develop joint solutions or integrations with their ISV partners. They’ve partnered with ISVs like revenue acceleration platform Introhive to bring relationship data into their product Sigma Lifecycle Manager, a lifecycle and relationship management tool built on Salesforce.
- Accenture offers its expertise and services in AI, ecosystem services, security, business process outsourcing, and more. They’ve partnered with ISVs like SAP, Adobe, Oracle, Workday, and Red Hat.
- EMMsphere specializes in digital asset management (DAM), marketing resource management, and work management solutions. They’ve partnered with ISVs like Aprimo, Workfront, Censhare, and Allocadia.
Should You Partner With a System Integrator?
There are several common reasons SIs are worth partnering with:
SIs help clients scale — whether they’re leading improvements for a specific department or for the entire organization. For example: a client could hire an SI to improve security across all of its departments once it hits the 100-employee mark. Prior to this stage of growth, relying on employees to use 1Password and two-factor authentication might have been adequate enough. As the business’s employee-count grows and the number of tools they use increases, they’ll need to invest in greater security measures to lessen their security risk across the organization.
SIs help ISVs spend more time on product growth — Since SIs manage most of the consulting and implementation work on behalf of their ISV partners, ISVs can focus more of their time on expanding their product and less time on providing one-to-one client services.
SIs help ISVs close more deals, faster — If you’re a small to mid-stage ISV, your SI partner likely has some kind of relationship with the client long before your sales team gets involved. The SI may be working on an RFP for the potential client, or they may already be working with the client on a variety of initiatives. In either case, your SI partner can include your product as their top recommendation for one part of the overall picture. The client puts its trust in the SI and thus has some level of trust in your product by association.
SIs can offer discounts in exchange for scale — The amount of deals an ISV can close through its SI partners makes it easy for ISVs to offer their products at lower rates through their reseller relationship.
SIs serve as a gateway to target businesses in a stage of growth — Businesses typically hire SIs when they're in a stage of growth that requires them to set a stronger foundation for scalability. This means the client is likely to invest in a variety of tools and processes to grow with them as their business grows — presenting a ripe opportunity for an ISV to become an integral piece of the client's tech stack.
Take Allocadia, for example. The marketing performance management software company’s ideal customer profile (ICP) prioritizes companies with $250 million or more in annual recurring revenue (ARR) — a turning point for growth for many SaaS companies. Allocadia's SI partners often include Allocadia in their clients' RFPs as the recommended platform for maximizing marketing spend, alongside other complementary softwares. In many cases, the SI partner supports potential clients in the buying decision and has greater influence in accelerating deals for Allocadia than the company would have on its own.
Tips for Partnering With a System Integrator
Working with SI partners presents a huge opportunity for ISVs if they treat the relationship with care and know when and how to engage SI partners to source and accelerate deals. Additionally, SIs play a critical role in their clients' success using their ISV partners' products — influencing their ISV partners' overall retention rates.
Below, you’ll find some tips for embarking on your first SI partnership (or maintaining your existing ones):
- Keep your SI partner up to date on partner enablement resources and certification courses relevant to their clients (without overwhelming them with certification that’s not relevant.)
- Establish Ecosystem Ops (a set of repeatable, scalable practices) for your sales team to communicate and co-sell with your SI partner’s team. Since your SI partner likely has a stronger relationship with the potential client, it’s likely your sales team will have a hands-off approach until it’s time to sign a contract. That being said, your SI partner should maintain communication with your sales reps throughout the sales cycle so that your team knows how the deal is going, what the timeline looks like, and if and when they’ll need to step in to provide support. Whatever the case may be, make sure your sales team knows what to expect and knows how each SI partner prefers to work together.
- Be transparent about how much or little you’d like your professional services team to be kept in the loop on ongoing client use cases and paint points. You don’t want your SI partner to lead the client down the wrong path and lose trust in your software. Catching a mistake earlier is better for you, the SI, and the client.
- Invest in a partner ecosystem platform (PEP) like Crossbeam to identify overlapping opportunities with your SI partners earlier in the sales cycle. For Allocadia, getting its product included in its SI partners’ RFPs is critical for driving partner-sourced deals.
- Invest in attribution tracking early to show the impact your SI partners have on revenue, and invest more of your team’s time and resources in the partners and tactics that are driving the most success. For example: Airship uses “parent” and “child” accounts in Salesforce to track its partners' influence throughout the sales cycle. Here at Crossbeam, we’ve created a “Partner Relationship Object” (PRO) linking partner accounts to sales opportunities for our AEs in Salesforce.
- Connect your CEO with your SI’s CEO early on. Establishing strong relationships throughout your team and your partner’s team can heavily influence the success of the partnership long-term.
Did you know that 82% of B2B SaaS companies have a channel partnerships program? Check out our Partner Playbook to learn more about channel partnerships and get tips and tactics from industry experts.