Five “Must Have” Elements of Every Successful Partnership
It’s fairly well known that a majority of business partnerships fail. In fact, statistics show that up to 70 percent of business partnerships ultimately fail. This is especially true for small to mid-size businesses that may lack the experience and resources to ensure proper nurturing and relationship management practices.
The modern business of today relies heavily on a patchwork of technology, integrated business processes and people-powered partnerships of varying sizes, ideally working in unison with cross-pollinating data, to create a more holistic and sustainable partner ecosystem. The more integrated and seamless these partnerships, the better equipped you’ll be to scale.
However, more often than not, key partners and platforms may be missing, inadequate, outgrown or simply the wrong fit, which creates a weak link in your company’s overall value chain, leading to hindered performance and growth.
There’s also a slew of factors, partnership models and structures of varying scope and mission-critical importance to make them work – everything from governance, equity and financing, research and development and mergers or acquisitions to supplier, enterprise technology, broker or reseller, marketing and management consultant agreements, just to name a few.
No matter what type of partnership you have or how many, they should all exhibit common traits and characteristics to be successful. So, what ultimately makes a business collaboration work? Following are some of the “must have” elements of every successful partnership that I’ve gleaned over the past 20+ years structuring, implementing and managing dozens of winning business relationships – both on the corporate and service side of a business.
Simplicity – The best and longest-lasting deals I’ve structured are often first etched out on one page. If you can’t clearly define the value, purpose, problem your solving or outcomes of an existing or potential partnership in less than one page, and ideally in one paragraph or even one sentence, I typically advise to go back to the drafting table.
Now, I realize complex deals require an abundance of supporting details, but never lose sight of your partner’s raison d’etre (reason to be) to advance your organization. And remember, a partnership should not always be just about the money. Your company’s vision and values need to be aligned to ensure a union that will withstand the test of time.
Shared Success– Even though most agreements are structured with a parent and child, prime or sub or client and vendor scenario, try to make them less one-sided and more peer-to-peer with mutual success always in mind. Your vision for success, values, culture and even work styles and ethics should be more closely aligned than apart.
Ultimately, your success equals their success and vice versa. Unfortunately, I can’t tell you how many agreements I’ve come across that are wildly off with large gaps in expectations with both parties. It’s also important to ask for and include what’s NOT to be covered in your partnership agreement so it’s extra clear on roles and responsibilities and who’s doing what. I also ask what’s the one thing that would make this partnership a grand slam in the first year? I revisit this question every year to help define shared annual partner goals and KPIs.
Communications – This may sound like 101-advice, but most partnerships fail because of this very issue. And, many studies support this point. The more transparent you can be, to the degree legally possible, the better. For example, do you have a partner marketing program where both parties are promoting each other? Do you provide partner testimonials and success stories? Do you regularly share knowledge and do both parties understand the bigger picture and their respective roles in it? And, do you have a shared project management, communications and collaboration platform in place that centralizes communications, to-do’s, plans, dashboards and reports?
Hyper two-way communications with a designated “point person” or partner manager is essential early in a business relationship across multiple constituencies and influencers. A clearly defined review and approval process with go / no-go checks and decision chain helps move initiatives forward more efficiently. If you don’t have a communications person in the room when structuring an agreement, get one. And if you don’t have a communications person or agency helping to manage a partnership or partner program, get one.
Care – As with any personal or business relationship, nurturing is required. You can’t set it and forget it. They all inevitably face fatigue and stagnation at some point. When this occurs, breathe new life into “tired” partnerships with new thinking, people and programs. Celebrate major milestones and recognize contributors even in small ways like a personalized, heart-felt thank you note. Otherwise, it may be a tell-tale sign it’s time to restructure an agreement or graduate to a different tier of service or provider.
An open informal or formal feedback loop for both parties is also critical. This vehicle provides a forum for venting frustrations, learning and making adjustments where necessary. To help support this, I encourage quarterly or monthly maps that outline campaigns or other outcomes we’re looking to achieve where it makes sense, especially for larger deals with multiple moving parts. These smaller steps ensure everyone remains on the same page and working towards the same short- and long-term annual goals.
Measurement – All partnerships should have quantitative and/or qualitative success metrics, which are aligned to the broader business goals and objectives. There should be people, systems, technology and processes in place to measure progress, variances and outcomes. There are many advanced enterprise business intelligence platforms on the market that enable batch or real-time data to be automatically pulled into visual charts of your choice from just about every conceivable business function and process you need to measure.
If important projects or initiatives start to go side-ways with a particular partner, pump the brakes and understand what’s gone awry before charging ahead. If not addressed quickly and properly, that little speed bump could become a major pot hole down the road.
Of course, there’s plenty of additional nuances and factors that make specific business relationships sparkle or fizzle out over time. If you had to pick just one element to make a partnership fly, what would that be?
Chris Faust – Founder & Chairman of Fastlane, a full-service branding, marketing and communications agency.