The Companies You Keep: How to Make Your Strategic Partnerships Work
Mar 07, 2019
By Kevin Thompson
Collaboration can provide amazing results for your business. New strategic business partners bring expertise that you do not possess and open you up to new markets and audiences. But integrating with a partner also raises difficult questions: Do you possess the same values? Who’s accountable to whom? How will you resolve conflicts that come up during the process?
The ability to craft strategic partnerships is one mark of an impactful brand, but alliances can herald hard times if you don’t do your homework in advance. Consider these questions to ensure a successful partnership:
Are your goals aligned? If you and your partner have different driving forces, obstacles could turn into breaking points. To work, partnerships need to be mutually beneficial. Consider the recently announced partnership between Yoox Net-a-Porter and Alibaba. CNN reported that Net-a-Porter will launch online stores on Alibaba’s Tmall shopping site and two mobile apps for Chinese customers. The benefit for Net-a-Porter is an increased platform in China’s luxury market, and Alibaba stands to gain more authority in its luxury offerings.
What are your expectations? Beginning a partnership under vague terms is like agreeing to sell your home without first negotiating a price. Partners need to understand what the other expects upfront, or you’ll spend a lot of time re-versioning. Channels of communication must be clear from the outset to result in something successful. For example, Google was looking for global partners to launch its augmented reality software platform, ARCore, by debuting apps on the platform. We communicated to Google what we needed and trusted its ability to bring apps to Android devices worldwide, so my company embarked on a partnership to bring a virtual staging AR app, Curate by Sotheby’s International Realty, to the market.
Can you make something unique? Some partnerships are formed from a sense of kinship or mutual appreciation rather than a genuine opportunity to make something new. If you really want to fill a gap in your customers’ lives, you need to ask: Will this partnership result in something original? For instance, as reported on HubSpot, Apple Pay has changed the way consumers transact. But for it to work, Apple needed credit card companies to integrate with the tech. Mastercard was the first provider to allow users to store their cards on Apple Pay—and we’ve all seen how it’s grown from there.
What does scalability look like? Some partnerships are designed to be temporary. Others last for decades and expand to serve a growing market. Make sure that potential partners can handle scalability issues upfront. If you run a large company with hundreds or even thousands of employees, for example, ensure that any partner has the infrastructure to support your needs. For example, when my company approached a media group about publishing a magazine that could be customized for various audiences, we first made sure that each party was aware of the scale of the project, which was inherent to the design. Only when we were sure our partner could support the expansive scope of the project did we move forward.
Is this partnership exclusive? Both parties need to clarify where they stand before moving forward. Establishing the terms of your partnership is vital if you hope to progress without misunderstandings. Exclusivity adds commitment, quality, and credibility to a partnership.
Forge strategic partnerships that stand the test of time by first sitting down with candidates and establishing your needs, expectations, and values. Ask the tough questions first, then watch your relationship blossom.
About The Author