Over 90% of Fortune 2000 companies have strategic partnerships. Only 50% of executives in these organizations feel that they got the results expected for the time and resources they invested in their partnerships.
So how do you create successful partnerships with your small and mid-market businesses? I think there are several ways to help your business grow through stronger alliances. I’ve worked with many great partners over the years.
Most of the organizations I’ve worked with have ranged between $5 million and $500 million in annual sales. Despite the small size of my organizations, 90% of the partnerships I was involved in were successful. There are several key reasons why they have worked so well when many larger organizations in our same markets have failed to get the results they expected.
I have broken the partnering process down to four keys that help you develop stronger strategic alliances. What’s interesting about these practices is they focus on the people not the technologies involved. If you follow these guidelines you develop stronger relationships from the very start of the partnership. I find that most partnerships fail on the people side of the business.
The first key idea is to define what you expect out of the partnership. Many of these partnerships fail from the beginning because one or both of the partners doesn’t know what the expected results are from the partnership. Before working with partners, take time to assess where they fit into your sales and marketing efforts.
Large companies have many different partners and may have different expectations for each they engage. Make sure you understand what they want and what they do to help you reach their goals.
The second key is to understand the culture of the organization with whom you are partnering. I advise businesses in the early stages of partnerships to choose their partners in a similar way to how you choose key employees. You would be better off having one or two partners and commit to them than trying to balance over many and not really knowing what value you bring to the partnerships.
Most of the businesses that are successful in partnering have top of mind awareness with their best partners. In several cases, partners I’ve worked with have provided innovative pricing structures for the relationship that allowed me to increase penetration into key accounts by providing aggressive service and new product support for early adopters.
The third key is find partners who have strong leaders in their partner programs. If you evaluate their partner program and find their leaders lacking, consider not engaging them as a partner. Strong channel leaders can get things done both inside and outside their partner organizations.
You can tell a lot about a commitment to partners based on the team they put in charge of the partner programs. I can think of several partners who rotate their executives through the partner programs before promoting to senior management.
When you’re working with new products, you want to be able to provide your partners with unfiltered feedback from the field. If a new product is struggling, it may provide you an opportunity to serve as a bridge to many early adopter clients so that they can help work out the problems before the product goes to Main Street.
The final key is don’t promise things that you can’t deliver to the partners. It’s critical that both partners trust each other. You would be better off working more closely with the partner to better understand why and what they want than to promise something that ultimately doesn’t work out well for your clients and customers. I have a friend who is so good at this, the partner told me that they feel like my friend works for them.
She brings new ideas to the partner on a regular basis and has created many breakthrough relationships with this much larger global partner. Because of her involvement, our organization always got first choice on marketing programs that our partner wanted to fund.
In several cases, their new product regional roll-out budget exceeded our national marketing budget for the year. This provided our business a competitive advantage in many key client development efforts.
There’s a bonus strategy here, as well. I have seen several mergers and acquisitions happen because of the strong partnerships that were established with partners. When you’re looking to build a more valuable business, consider how you might upgrade your business partnerships to increase your businesses value. It not only pays you with increasing sales today, but it also insures a better price for your business tomorrow.