Partnership Focus - Affinity Maker™

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Feb-09

Welcome back to Partnership Focus. Whether your holiday season was filled with festivities or a chance to wind back a little and relax, we hope that you're ready for happy and productive 2009.

For our first newsletter of 2009 and given the turbulent economic times, it probably isn't surprising that many of you are looking to strengthen your business in any possible way; in this issue we explore how partnerships and alliances provide real alternatives. We also look at some business growth options you should consider; and we share with you a book we thought interesting. Finally we are also including from our series, a valuable partnership tip to help you create successful partnerships and alliances.

ARE PARTNERSHIPS THE SOLUTION FOR THOUGH FINANCIAL TIMES?

By Rubilda Segura

We have started this year with news from all over the world about the hardships that many businesses are facing, the thousands of people that have lost their jobs, and the not so optimistic forecasts for diverse markets around the globe.

To combat the effects of the financial crisis causing slowing sales and reduced cash flow, have you considered using partnerships and alliances as a way to lower your risk profile, improve cash flow, grow revenue, bring new products or services to market quickly, share experience and expertise and reduce cost?

Recent headlines tell the story of what other organisations are doing:

'Plans for Strategic Alliances on the Rise: Nearly one-third of consumer products companies plan to forge new strategic alliances in the upcoming 12 months (30 percent), up 8 points from the second quarter of 2008 PricewaterhouseCoopers NEW YORK, Dec 4, 2008 (GlobeNewswire)

Some organisations have gone further. For example, Peter Ward, VP and GM at Xerox Europe, puts their strategy very clearly; “Partnering is no longer a part of our business; it is our business“.

Just think about it, with the financial crisis slowing down our economies, buyers tend to become savvier and demand more value for their money. The safer way for your business to offer that extra value is to partner with companies that complement your product or service.

For example, would it not be great if your favourite credit card, besides rewarding you when you buy and pay on time, could also offer you access to financial advice or free access to a financial knowledge base to help you make better-informed financial decisions.

How this would work you may ask. Simple! For you as a credit card holder to be able to have access financial advice, your bank would need to partner with a group of financial advisors who would create a special offer. Those advisors could also create some financial tips so you can access financial knowledge. Or even simpler; the bank could create an alliance with the Financial Times magazine which will grant you access to financial knowledge.

The same concept of affinity (a close connection marked by community of interests or similarity of nature or character. A common bond, interest or kinship.), can be applied to almost every business, including yours. To help you make the most of you partnerships you, call on the experts; Affinity Maker can provide you with assistance for making your business 'partner ready', choosing the right partner and managing the partnership to maximise value.

If you want to learn more about how partnerships could be beneficial for your business Contact Us.

WEIGHING UP BUSINESS GROWTH OPTIONS
BUILD, BUY OR PARTNER

Marguerite McGinlay, Chief Executive Officer of Affinity Maker™ steers you through the initial thinking process when evaluating whether to follow a business growth path of build, buy or partner. This article will provide you with insight into where each strategy is applicable and the potential advantages and challenges associated with each of these business growth options.

Loyal customers have stayed with you because they can rely on your expertise and ability to provide them with specific solutions. As their business grow or the market changes they will need more than you can currently offer. Planning to meet their needs is essential before they decide to seek a provider with broader capabilities.

If your customers are already asking you to provide them with expertise or services you do not have or are beyond your core capabilities; the best approach is to choose a strategy that will best support your customer’s needs without conflicting your business objectives.

Buy Capabilities Externally - Purchasing capabilities from another company can help you to quickly meet your customers’ needs; and may be expand your customer base. However, finding the right supplier will require time, human resources, and will have specific financial requirements.

Build Capabilities Internally - Building your own capabilities can be costly and time consuming. It requires researching new technologies, methods or processes; consulting experts, building the team that will handle the new assignment (this includes hiring new staff and/or training your existing staff); and buying/renting resources needed to provide the service to your customers. All to compete with more experienced companies in the same business solution.

Partner with Another Organisation - Teaming up with another organisation whose capabilities complement, but don't compete with your own, will allow you to grow without the risks of buying or building the capabilities you seek. However, with this solution you will need a collaboration management system both you and your partners can mutually accept and agree to follow.

How Partnering can benefit both, you and your customers?

Working in partnership enables you to offer a greater range of solutions that will not only serve your existing customers but will attract new ones. By providing a one-stop-shop with a better-integrated solution you will benefit your customers by saving them time and money, they will not have to search for additional providers. This will help your business relationships grow stronger.

Integrated solutions have become a ‘must have’ if a business wants to compete for a share in the market. This opens great opportunities for partners to pool their skills and pair capabilities to offer better-integrated solutions cost-effectively without having to carry the cost or risk of setting up or buying the entire infrastructure.

STRATEGIC ALIANCES AND MARKETING PARNERSHIPS:
GAINING COMPETITIVE ADVANTAGE THROUGH COLLABORATION AND PARTNERING

It is well recognized that partnerships not only represent a fundamental element of a firm's go-to-market strategy, but potentially can be a source of competitive advantage. Peter Ward VP and GM at Xerox Europe puts the case clearly 'Partnering is no longer a part of our business; it is our business'. This idea that partnering is central to many business models stands in sharp contrast to reality. Partnerships are notoriously difficult to manage … FIND IT

To CREATE a succesful partnership; the parties involved must clearly understand what partnering is, its implications and requirements; they should also see the partnership as a business strategy to improve their current contracting process. Partnering will only work for organisations that are culturally prepared to accept change. They must recognize that the up-front investment in preparing to partner will yield significant benefits throughout contract performance.