Last week I wrote about my consulting assignment to help a client’s business development needs. I mentioned that we had been working to recruit a Strategic Partner (SP). In fact, we closed that deal this week. This new partner is highly experienced in my client’s industry segment and is active in a different geographic quadrant of the U.S. Additionally the SP has depth in segments my client desires to penetrate more fully. This partnership seems to have great potential. My client’s decision to enter into this agreement is aligned with the direction of the economy.
So what is a Strategic Partner? SPs may be in business to serve the same target market but not as a direct competitor. Or, they could be an indirect competitor who serves a different target market. They may work in a market segment you would like to penetrate, but lack the resources. They may have expertise your company lacks and vice versa. Your company may have identified a prospective client who cannot be closed due to a lack of competence in their market segment. However, if there is a relationship with another company, or contractor who has the needed skills, an engagement may be possible. An SP can complement your business.
The SPs I have developed came from referrals. My network pointed me to these folks, initially as a resource for searches. In my work, as with any consultant, I learn a lot about my client's needs. It is natural to want to help them solve problems to become more successful. Their success will ensure a long term relationship and continued success for my brand. I view this support as value-added. Having the ability to refer additional resources to help my client becomes a win-win.
Selecting a Strategic Partner is very similar to hiring a full-time employee. One must do their due diligence to ensure that the candidate has a demonstrated, verifiable track record of success. The candidate must match your company's culture and values. They must have an excellent reputation for building bonds of trust. They must play well with your team. The past is prologue. Check their references. You must employ a thoughtful selection process as the SPs brand will become linked to yours. The wrong partner will damage your brand.
An SP is a formal business relationship; consult your attorney to document your agreement. Risk will drive the scope of your contract. At the very least you will want to have a letter agreement on record. The term of the initial agreement should be long enough to get a good read on the SP, without suffering a prolonged mistake. A clause to end the agreement with appropriate notice is necessary.
On quality control, you must exercise oversight. You cannot dictate how they perform the work; however, you can monitor their progress and outcomes. Check in with your client on a regular basis. Secure feedback as to the SP’s performance. If there are issues, you must be alerted to facilitate corrective action. You have a brand to protect, so be engaged.
[Tweet “Building one’s business via Strategic Partnerships is about leveraging resources to support a strategic initiative.”] It is a real force multiplier. Strategic Partners can enhance the value of your brand, and if managed well, strengthen bond with your client. When you enter into an SP, you are formalizing a relationship to build a line of business. You become a marketing resource for your SP, who becomes another source of revenue to your business.
Strategic Partnerships as a business strategy carries risk, as well as rewards. Seek win-win relationships. [Tweet "Properly incentivize, resource, and manage the Strategic Partner. Choose wisely."]
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Jim Weber, President
New Century Dynamics Executive Search
Author of: Fighting Alligators: Job Search Strategy For The New Normal
Current Assignments
1. Strategic Partner – Atlanta-based B2B Professional Services Company – Complete
2. Director of Business Development, Atlanta-based B2B Professional Services Company: New
3. Training Director – Southeastern-based Restaurant Group: New
4. Senior Accounting Manager – Atlanta-based Manufacturer. New
5. Controller – Orlando, FL-based Restaurant Company: New