The Importance of Partnership in Business
The partnership is crucial to the growth of any business venture. Merchants and traders from time immemorial have made use of the principle of a strategic partnership to conduct their businesses; the trend is still very much applicable today. A partnership manifests itself in different forms, ranging from business owners cooperating to invest in a project to share technical knowledge and ideas between firms. Whatever any business does, it is important to look for the right partnership agreement that benefits both parties.
The greatest change in corporate culture-and the way business is being conducted-may be the accelerated growth of relationships based... on partnership.
Factors to consider before choosing a partner:
It is great to form partnerships with other businesses! However, what any smart business owner must consider before signing on the dotted lines of a partnership agreement is that not all partnership agreements work out as planned. Some firms have generated massive problems for themselves by working with poorly-aligned partners that fail to bring anything to the table. You shouldn’t make the same mistake. To avoid potential pitfalls, consider the following 3 factors:
1. Trust and Respect
When starting a business, the secret to the success of every partnership agreement is rooted in trust and respect between the two partners. You must be able to trust the decision making, temperament, vision, and competence of your partner and vice versa. Make sure to respect one another’s abilities and personalities.
If people like you, they will listen to you. But if they trust you, they will do business with you.
Before starting a partnership, know exactly what each business does and how your brands align. Form an alliance which has a way of setting goals and simultaneously propagating the objectives of each business. For instance, the demand for the products of company A should be able to spark a chain reaction to drive up the demand for the products of company B and vice versa.
3. Similar Values and Shared Goals
It is important to form a partnership agreement with a firm whose corporate goals and values augment your own. There are firms whose main focus is to make a profit and maximize shareholders wealth, while others are more concerned about corporate social responsibility and puts profit making as a secondary objective. Partnering with a business that doesn’t share primary objectives may lead to a clash of values and risk driving a wedge between the firms. This will likely lead to the death of the agreement.
GOOGLE x LUXOTTICA
While partnerships have their difficulties, businesses can gain infinitely more when they choose to partake in strategic partnerships. A lot of businesses have leveraged on the distinct advantages that come with partnership to grow their businesses and take it to a higher level. No matter how successful your business is, the right partnership can take it to even greater heights.
Great things in business are never done by one person. They’re done by a team of people.
A powerful example of how strategic partnership agreements can help your business attain greater heights is the partnership agreement between Google and Luxottica. Google is a tech company known globally for the efficiency of its search engine. Luxottica is very popular for their luxury and stylish eyewear that is more suited for fashionable audiences. Both firms decided to form a partnership to increase their sales, which led to the invention of Google glass. Looking for more reasons to grow your business?
5 BENEFITS OF STRATEGIC PARTNERSHIP
1. Access to Knowledge
Firms need a wealth of knowledge and that knowledge comes in bounty with strategic partnership agreements. This gives you the opportunity to grow and learn from another's perspective. All of the knowledge would be put into use to further build your brand and business in the future.
An Investment in knowledge pays the best interest
2. Competitive Advantage
Partnerships increase your lease of knowledge, expertise, and resources available to make better products and reach a greater audience. All of these put together along with 360-degree feedback can skyrocket your business to great heights.
3. It Enhances Your Business’ Credibility and Image
The right business partnership will enhance the ethos of your firm. When firm that share the same goals and vision join forces, the influence and strength of each organization can grow dramatically. Stronger business provide better products and deliver more qualitative services to customers, which boosts overall brand equity.
Alone we can do so little; Together we can do so much.
4. It Increases Your Customer Base
Through a functional strategic partnership agreement, your business would grow its customer base. There are a lot of ways through which this can be attained. It could be through a direct agreement you have with a firm who offers products that are complementary to your own. A car manufacturer who forms a partnership agreement with a tire manufacturer may have an agreement in place that makes everyone who orders for a new car to get their tires from the firm they are in agreement with and vice versa. This alone would help you in growing your customer base as customers are drawn to great products and services.
5. Long Term Stability
The goal of all businesses is to remain relevant for a long time and reach its set corporate goals. Having business partners mean you are no longer operating in isolation. You’ll have access to more knowledge, innovation, expertise, and funds. The bottom line? A great business partnership makes you better, lifts up your weaknesses, and enhances your strengths. In the end, this is all you need to be relevant for a very long time and help your business achieve its objectives and key results.
Suffice is to say all businesses need to look for the perfect strategic partnership that complements their activities as it is a sure way to grow any business moving forward. If large multinational corporations like Google, Apple, Luxottica, and others still see the strategic partnership as a way to grow and expand their business horizons, then there should be no excuse for any business owner to not follow suit and reap the benefits that come with a well-aligned partnership.
How does OKR help with Strategic Partnership?
OKR is a “goal setting methodology” that helps organizations achieve ambitious goals by bringing together individuals, teams and the entire workforce, and guiding them in the same direction. Let’s go through an OKR example to get a clear understanding of how OKR works. Consider that you need to improve your company’s partnership base. This can be done by seeking advice from experts in the field, teaming up with consulting firms, and increasing the number of trade associations.
As you can see, the OKR methodology allows you to focus everyone’s efforts on what really matters and measure the performance of your team.
In general, people who have been in partnerships claim that it is difficult to maintain such agreements when objectives are not shared or clearly expressed. OKR solves this issue because it provides both parties with quantitative clarity, which leads to synergy and success.