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Modern software ecosystems have changed.
Ecosystems are no longer valued for the sheer quantity of solutions they offer — they are valued for, well, the actual value their solutions provide.
More doesn’t mean better; better means better.
It’s a key insight from our guest today, Tom Roberts, Senior Vice President at the Global Partner Organization over at SAP.
Tom has had incredible success at SAP, building a business that now delivers more than $1B in revenue to SAP’s top line while overseeing the Solution Extension portion of the business as it grows 89% year-over-year.
There are a lot of great takeaways from Tom’s success and experience and he shares many of them with me today.
Tom goes over:
How to get your ecosystem management “just right”
Why today’s software ecosystem prefers quality over quantity
Great advice for anyone looking to replicate his success
Getting ecosystem management ‘just right’
Tom likens recent developments at SAP to the Goldilocks story.
A few years ago, when software partners came to SAP, their options were to get listed in the AppCenter or get into the Solution Extensions program.
In the case of the app center, this bed was often seen as too small by certain partners. And the premium-level Solution Extensions option had the opposite problem — it was very difficult to get into for younger, more innovative software partners.
Tom says they’ve now revolutionized the journey partners take when to come to SAP and grow with them.
Starting small, they can be featured in “Spotlight,” which is on the AppCenter and is where SAP puts in its own money to help with the go-to-market. Then, if the market shows real traction, they can be invited into the “Endorsed Apps” program, which is the next level of progression.
This level is a sister program to Solutions Extensions and SAP sees it as another premier level for the field to engage with the partner and ensure there is a true go-to-market with their solution.
SAP now manages its ecosystem as a journey with its partners, ensuring as these partners build and grow their solutions and grow in the market, they can leverage SAP’s brand and reach to achieve their goals.
This shared journey makes sense in the changing landscape of software ecosystems. The old model of partner programs in which a tiered, podium-like structure defined their ecosystems no longer makes sense.
SAP knew they wanted to do something different because the life cycle of these applications has changed so much. And, of course, this means the shared journey has also changed.
The new era of software ecosystems
Tom also saw the need for a deep interest in partner products within SAP’s ecosystem. In fact, he won’t talk about a partner’s product until he has a deep understanding of the product.
This is because it’s important these are the best solutions for SAP’s customers, who are going to be the ones using these products. Additionally, the focus in this modern era of software ecosystems has shifted from being about the quantity of offerings available to the quality of offerings.
Tom’s analogy is the cell phone. If you take the offerings in the Apple App Store, you don’t care if there are 50 apps claiming to have your solution. You only care which is the best because you are only going to use one of them.
Which makes ratings and curated content so much more important.
That means the most important metric is not how many apps are listed in your app store, but how good the ones listed really are and how much your customer’s like them.
Focus on what you’re best at
More doesn’t mean better when it comes to the solutions on offer, but this axiom also applies to your business in other ways.
Tom has some great advice for anyone trying to replicate his or SAP’s success: Focus on a few things and do them well.
Too often, people want to be good at everything. And then they face the problem of not being great at anything.
If you want to be a success, focus on the things you want to be known for and do them well. There is so much opportunity out there and so many ways to succeed but without focus, you will lose the opportunity to differentiate.
And this applies to building an ecosystem, too. It’s best to start with a focus on a few partners and really build world-class relationships before you scale.
“More isn't better, particularly when you're starting. What's better is value. Have deep successful relationships you learn a lot from, and then you can expand and grow your business.” — Tom Roberts
So, rather than looking for a huge number of partners, look for the right partners. Invest in them in a meaningful way and, ultimately, you’ll deliver the best for your customers.