Being the best of friends

The first time I seriously set out to help two companies establish and develop a strategic partnership was quite a few years ago. I remember the experience very clearly because it set the tone for similar adventures over the years that followed and it also helped me to formulate a few rules for partnering in general.

Rule one: be realistic
Most potential partnerships between companies fall down at the first hurdle, mainly because the prospective partners cannot agree on why they should work together and what they can reasonably achieve.

Sometimes one partner sees the other as no more than a source of new leads - and just cannot understand why a wave of new business does not simply appear once they sign an agreement. This is a very common pitfall on the road to building a partnership: there are plenty of other potential misunderstandings out there, too.

I think that the key first step is to identify something you can do together, but that you cannot do separately. It doesn’t have to be anything big or dramatic: you just need to demonstrate the principle. Once you have done this, you can win support inside both potential partners and build interest in potential next steps. Without this, you will get nowhere.

Rule two: be open about obstacles
New partnerships often begin in a cloud of misapprehension and suspicion. This is especially the case where the companies concerned might compete against each other in some circumstances.

I once helped a small European systems integrator and a large global software vendor to set up a partnership and, in my innocence, I could not see why two such very different companies would ever come into conflict. I felt there would be no real objection to collaboration between them, but I was wrong.

The software vendor is part of a larger group that includes a huge systems integration business. In one geography (and only one) it had bid against the small European SI for a reasonably large contract, and there had been a lot of bad feeling between the two bid teams.

The partnership idea was vetoed twice due to lobbying by one of these bid teams. They were so annoyed with the other company that they could not imagine doing business together. It took me a month or two to understand where the problem really lay and then a few months more to defuse these issues.

The partnership eventually happened and is making money for both companies, but it showed (as if we didn’t already know) how and why conflicts on a personal level can block a rational business proposal, time after time.

> part 2