One of the most successful strategies to expand your customer base is to form a partnership with another company. Strategic alliances allow you to provide more value to existing and potential customers.
Here are 8 Steps to Form a Strategic Partnership:
1. Identify the Demand
Determine why you want to develop a partnership with a company. Recognize the benefits and drawbacks that each firm will offer to a partnership. Is your company equipped with the necessary tools, abilities, and competencies to establish an alliance? Determine how an alliance fits with your business plan and what you expect to gain.
2. Evaluate Partners
Conducting research on a potential prospective partner is essential. It’s fundamental to feel comfortable with the work style of the possible alliance. Once you’ve discovered that the other organization has complementary skills, you must objectively assess management styles, work ethics, and values to see where potential conflicts may arise.
3. Set Joint Objectives & Mutual Goals
Developing key objectives and goals that reflect what both parties expect to gain is essential. Ensure expectations are reasonable with respect to the resources both companies are willing to invest and allocate. Nothing strains an alliance faster than the perception that one party provides everything while the other is receiving all the benefits. Strategic collaborations must create an environment where both parties benefit.
4. Define Roles & Responsibilities
Evaluate each company’s strengths and responsibilities based on the organization’s area of management. Many partnerships dissolve because of poor management ties. Make it clear what each company will be liable for. Determine the number of personnel from each organization who will be involved in the partnership and their specific roles. Each party must devote resources to the partnership, and both parties require someone to lead the initiative within the organization.
5. Create an Effective Communication System
To establish a long-lasting partnership, clear communication is essential. Developing adequate progress for working with your alliance will help you prevent disappointments and any misunderstandings. The organizations must form a relationship where both parties can be open and honest while evaluating forecasts and making improvements. Both parties should complete these tasks and actives on a regular basis.
6. Devise a Framework for Resolving Conflicts
It’s natural to have miscommunications, compromises, and conflicts. When misalignments occur, resolve them as soon as feasible. It’s ideal to meet in a neutral territory where both parties can speak openly and honestly. Rather than assigning blame, concentrate on finding solutions.
7. Demonstrate Commitment
Both parties must be willing to nurture and care for the partnership they form and the objectives they have. This involves collaboration from the top executives of both firms. Any strategic partnerships should aim to create an impact and cannot achieve this without active engagement from both organization’s leadership. Thus, it entails putting an extra effort to make the venture successful, even if that means going beyond contractual duties. Committed partners invest their time and resources and take risks to make the venture successful.
8. Formalize With an Agreement
A written document agreed upon by both parties is formalized, and it outlines the expectations that safeguard both parties if your alliance does not meet expectations. If a conflict arises, there is a document you can refer to in order to maintain the relationship.