Strategic partnerships can add substantial value to a company through shared resources, capabilities and expertise. They can also assist with building capability platforms and realizing scale-based advantages.
Success with strategic partnerships requires developing an appropriate strategy, aligning (both internally and between partners), and seamlessly incorporating their activities and processes into those of a company.
1. Shared Value
Strategic partnerships can make an enormous difference to the success of your business. They can expand your market, broaden your reach, and generate more revenue for you – but first they must align with your goals and purposes; that means first defining exactly what goals are most important to you.
Search for potential partners who share these same values and are willing to work toward helping you meet your goals. It is also crucially important for both parties involved to communicate openly about any changes that could affect the relationship.
Successful partnerships require shared values and a commitment to constant development, including a scorecard with regular touchpoints to monitor progress and adapt your contributions based on ongoing feedback.
2. Shared Risk
Faced with an increasingly competitive business environment, companies are turning to strategic alliances as a way of expanding their businesses. While this approach can often prove more sustainable and lucrative than organic growth or acquisitions, managing such complex agreements takes trust, collaboration, and equitable risk-sharing to successfully implement.
Engaging partners from diverse business cultures and with different communication styles can be challenging, but tools and interventions exist to bridge gaps in collaboration processes.
One approach is to establish an alliance-management team charged with monitoring and reviewing partnerships against pre-determined metrics, which may allow companies to quickly spot areas of potential concern before they become big issues and give themselves time to react accordingly. Another is holding regular, ongoing meetings between partners in order to maintain open communication channels and resolve any potential conflicts from an amicable basis.
3. Shared Success
Strong partnerships can unlock new business opportunities and increase revenue for both partners, but it is important to recognize that not all partnerships are equal.
One of the main factors that threaten to derail partnerships is an absence of collaboration and communication between both partner companies. Therefore, executives from both partner firms should spend time building trust on each other’s turf in order to facilitate cooperation and understanding between their organizations.
To ensure all parties understand the value of their partnership and reach mutually agreeable goals, both should create a set of measurable objectives.
At the same time, it is also vital to regularly communicate with your partner and maintain open lines of communication. This should include reporting any changes within your company that could potentially have an effect on the partnership and discussing how best to adjust expectations or manage resources accordingly.
An effective strategic partnership requires sharing a vision and making a commitment to its future, which ensures both sides benefit from it equally.
4. Shared Growth
Strategic partnerships involve the joint effort of two businesses. By pooling their strengths together, strategic partnerships enable each to focus on what they do best while creating unique products which others cannot match.
Strategic partnerships allow companies to expand into new markets and sell through various channels more easily while spreading innovation risk among all participants. But just like all relationships, strategic partnerships may fail if one party feels they no longer see value in being involved with another party.
Building effective strategic partnerships requires strong governance. An alliance-management team should be assembled in order to monitor and review progress against defined metrics.
An alliance-management team should comprise senior line executives from each partner that remain actively engaged with the ongoing relationship and can serve as “deal sponsors” when necessary.
Communication is key for maintaining successful partnerships, so bi-monthly meetings as well as frequent emails and Slack messages must take place regularly.