Member Andy Barrons Speaks: Build on Your Reputation of Independence

The Challenge:

The case at hand was brought forth by the executive of a profitable company with uneven revenue streams that led to high and low months. He was considering developing more stability by reselling partner products to his loyal customer base.

If you were in this situation, what would you do?

It is moments like this that we live for at the Alliance. I have been in your exact same position and also attempted a reselling model to smooth out revenue. I can tell you unequivocally that it was a disaster. Why? By hawking third party products to the customer base, the intrinsic trust of the relationship is undermined and the company’s impartiality in giving the best advice is called into question. I know it because I lived it, and though we managed to repair client relationships, damage was certainly done. I am glad I can share this with you today in hopes that you’ll consider other strategies to meet your ultimate goal of smoother revenue.

Since I come from the software industry, allow me to share a strategy that comes to mind. In light of the vast amounts of data that your company generates, if I was in this situation, I would consider building software that automates analysis of the data and provides useful insights to customers. Indeed, they may appreciate the option to access these insights as a licensable subscription service that would provide predictable revenue to the business. A pot of gold may be found in what used to be considered archive data. I might also consider expanding the geography beyond current markets to diversify client base and generate more stable revenues. Both of these strategies would double down on current core competencies, rather than rely on reselling third party products and services. These strategies build long-term value for the company and shareholders.