A few years back, Peter Caputa, the CEO of Databox and someone who has set up a number of successful partnering arrangements over the years, was asked about what were the most critical steps in setting up a successful partnership. His reply was ‘creating alignment between our partner’s growth goals and ours is the first and perhaps the most critical step… but it’s not enough.’
When it comes to building optionality into our business, leveraging new capabilities, and grow beyond the existing business, partnerships must be part of the conversation. They should not only capture our attention but also our sense of confidence.
That said, for many executives, this is not the experience they report. Partnering options often arrive late at the table, viewed as a weaker option, a lesser alternative, where one yields control or where complexity is added. Taken from an investor’s perspective, the sense one gets is that, when partnering, we should prepare ‘for a haircut’ – lower returns, less flexibility, and more risks to consider.
That should not be the case. The loss of control in a partnership is often merely the loss of the illusion of control, at most, it is the loss of control over under-productive assets, to a party who could better manage them. The claim of lower margins can often simply be an indication that we haven’t looked deeply enough at what capabilities partners can bring and many of these are not visible at the outset.
Here are a few points to consider:
- Discovering a common ambition is at the heart of a good partnership. It may not be the ambition you had in mind at the outset, but a joint and often larger ambition. Be a partner in dreaming, envisioning, and voicing whatever new value can emerge, and with good partnerships, others will add to your narrative – influential stakeholders, experts you have given a voice to, and those willing to step in and innovate.
- Develop a set of hypotheses around what the partnership could grow into and how it would optimally operate. I use the word hypotheses deliberately here, as they would be initially untested and may be different from how your organisation currently operates. Ask yourself – who are my admired organisations? who could help inspire the way this partnership should function and serve?
- Have a difficult conversation – not only about what value we could create but how would each party realise the value potential. Each party may have a different realisation roadmap and mechanisms to choose from. It may be an uncomfortable discussion, but often what we fear the most are simply assumptions, waiting to be tested, nothing more.
Partnerships, we have found, at their essence, is about possibility. One cannot predict or ‘legislate’ for every eventuality, but with the right mindset, we open ourselves to learn as much as we teach, to experience what our organisation may yet be able to provide and to draw on our respective strengths and our confidence, to generate (and realise!) new value.
Have a good weekend everyone!
Saar Ben-Attar (A Connector Beyond Limits)
“I quickly realized that creating alignment between our partner’s growth goals and ours was the first and perhaps the most critical step of creating a successful partnership, but it certainly was not the only one.”
[wpforms id="2044" title="false" description="false"]