Developing Successful Strategic Partnerships

As businesses grow in size and expand operations, there is a need to look at partnerships to achieve goals and objectives. Trying to do it all yourself is no longer a good strategy in today’s times. There is instead an increasing emphasis on finding strategic partners to expand and support your business.

Defining Strategic Partnership

So what is a strategic partner? A strategic partner is a like-minded company that provides products or services that not only complement your business but also support its growth story. The partnership is usually defined by means of a business contract and is time bound. A common example can be found in the supply chain industry where logistics are usually managed by a 3PL that functions as a strategic partner. This allows the main company to focus on its primary business while leveraging the skills and experience of the partner to carry out the logistics function.

The success of the partnership largely depends upon the homework you have done while choosing the partner and if your partner’s goals match with yours. Here are a few tips to keep in mind:

Be Clear On The Objective

You need to be very clear on why you are venturing into the partnership in the first place. Make sure you have clearly laid out goals for the partnership and how they align with your vision and long term plans. Also, set up periodic checkpoints to ensure that the business case for the strategic partnership continues to hold true and goals are being met.

Focus On Similarities But Also Leverage The Right Differences

It is very important to find a partner who has similar values, ethics, culture as you in order to build a good relationship. Also, check if the partner can adapt to your changing needs and keep up with your pace of growth. While looking for similarities also spend some time understanding the differences. There might be some opportunities hidden here, for example, a marketing partner serving a different region could create future opportunities for you to expand your operations. If your partner is innovative then it creates new service opportunities for you as well.

Understand The Risks

While strategic partnerships are great for business you must also be aware of the risks involved. Think of the long-term implications before getting into the partnership. Also, be prepared with a mitigation plan in case the partnership does not work out. How will you measure the success of the partnership? How will you safeguard your interests in case of a discrepancy? The more risk identification and mitigation planning you do up front the easier it will be for you work with your partner.

Learn From Experience

Your long-term growth plan might involve setting up a series of strategic partnerships. As you go along, pause to reflect and debrief with key stakeholders. This learning will help you to setup a robust process for defining partnerships and making them work for you.