Authors: Ryan Kelly, Tim Shinbara
The more complex the global marketplace becomes, the more attractive the idea of partnership is to many companies. Companies typically enter partnerships to seek benefits they cannot access themselves, and they seek partners for several reasons, including access to complementary capabilities, greater financial strength, access to new markets, to pool resources, or to reduce risk. As such, companies that partner may gain an advantage in the marketplace over companies who lack the skills to collaborate effectively.
Although there are many different types of partnerships, principal partnership models include:
Supplier/customer partnerships: Partnerships in which the parties have done business together.
Partnerships between peers/competitors: Partnerships where companies pool resources to gain a benefit too expensive to acquire alone, such as access to an advanced technology.
Joint development partnerships: Partnerships where companies jointly pursue a venture such as access to a new market or to gain scale efficiencies by combining assets and operations to share risk for major investments or projects.
Corporate/startup relationships: Partnerships where the larger company typically provides financial resources, and the startup provides a new technology or service.
Public-private partnerships: Partnerships between private companies and entities at local, state, or federal levels. At the federal level alone, there are 58 programs in 11 federal agencies that provide support to U.S. manufacturing with hundreds of millions of dollars in aid available.
Academic institutions: Partnerships in which companies often obtain early-stage research from universities and gain access to the best scientific and engineering minds in specific domains.
Successful partnerships don’t just happen without effort. Strong partners set a clear foundation for business relationships and nurture them. They emphasize accountability within and across partner companies, and they use metrics to gauge success. They are also flexible and willing to compromise if needed. Focusing on these priorities can help partnerships thrive and create additional value. While pursuing partnerships requires effort, and there may be tradeoffs, the work and preparation necessary to make your company a good partner – greater self-awareness, ability to generate alignment, strong communication skills, ability to learn and incorporate learnings into strategy – will very likely help make your company a stronger business in the long run.
For some companies, partnerships are the essential ingredient to grow and thrive in an increasingly complex and unpredictable marketplace. In the near future, a company’s collaborative advantage – the ability to leverage effective strategic and operational relationships with other companies – could be more fundamental to winning than what we refer to as competitive advantage today.
To read more about the value of partnerships in industry, read the full white paper here.
