Transcript Slide 1

The Art and Opportunity of Building
Strategic Alliances
Presenter: Anita Campbell
How to grow your business faster
and save your sanity with business
partnerships
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Today’s Partnering Agenda
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What is a strategic alliance?
Criteria for successful partnerships
Who should you partner with?
How to establish partner relationships
7 Good Reasons to Partner
3 reasons NOT to partner
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The Power of Partnerships
$53,000,000,000
In 1980, upstart
Microsoft partnered
with then-giant IBM.
The Microsoft DOS
operating system
was distributed with
IBM’s new personal
computers.
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What is a strategic alliance?
 Means many things to different people
 Can describe:
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Cross referrals
Outsourcing to 3rd parties
Co-marketing
Online affiliate arrangements
“Business partnership” arrangements
Joint venture companies
Legal partnerships
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Formal Tech Partner Programs
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Definition: Business Partnership
 Today we will focus mainly on
“Business Partnerships”
 Criteria:
• Each side brings something to the table the other
doesn't have
• Each made strategic decision not to spend the
time or money to do it alone, or can’t do it alone
• Together, you are better equipped to meet a
market opportunity
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Do You Need A Partnership?
ASSESS YOUR NEEDS
 Evaluate your situation – do a SWOT
analysis if necessary
 Walk in your customer’s shoes
• What do they need? Versus what you offer
 Observe competitors
• If they are ahead, how do you catch up fast?
 Evaluate market opportunities
• Do you have everything you need to capture a
market opportunity?
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Do a Cost Benefit Analysis
Evaluate partnering against not partnering
 Speed
 Focus
 Make vs buy
 Sometimes partnering is the ONLY option
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Do You … REALLY … Need A
Partnership?
SUCCEED,
25%
FAIL, 75%
75% OF ALL PARTNERSHIPS AND ALLIANCES FAIL
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Establishing Partnerships - You Us Me
YUM Method: Broach a partnership with
another party in this order:
 You – what’s in it for the other party
 Us – what can we achieve together
 Me – what I get out of it comes last
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PESD to A Partnership
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P = Paint a picture of the partnership
opportunity and potential
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E = Explain the mechanics of how you see it
working
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Example: “There is an opportunity for you to
extend your reach into XYZ market by ….”
Example: “If you can advance more inventory
without requiring up-front terms, our company
can accept more big orders. Require a 20
deposit, and allow the remainder to be paid out
over time. In return we will ….”
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PESD to A Partnership (cont’d)
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S = Sell the benefits
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Be prepared to demonstrate with hard numbers,
such as “… this deal would double sales on your
XYZ line.” Remember to focus on the benefits to
them, not you.
D = Document the relationship
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Partnerships may involve formal arrangements
such as contracts, or in other cases something
less formal. At the very least there should be an
email or letter outlining the arrangement.
– Tip: document it fast. Deal momentum can die.
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7 Good Reasons to Partner
 Partner with suppliers to finance the growth
of your business
 Open up new markets
 Get access to valuable training and tools
 Establish credibility
 Strategically add specialty expertise
 Round out your product or service offering
 Meet governmental contracting requirements
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Be Choosy When Partnering
“All man's miseries
derive from not being
able to sit quietly in a
room alone.”
-- Warren Buffett, the world’s second
richest man, adapted from Blaise
Pascal, 17th century mathematician
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3 Warning Signs NOT to Partner
 No compelling goal: You don’t have a specific
business goal to pursue jointly
• Use the “revenue measure”
 Vagueness: Your partnership is vague
• Small businesses don’t get much out of vague
“marketing” partnerships – better off selling instead
 No Commitment: Your partner (or some faction
within it) is not committed
• The “kiss of death”
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Thank you!
Anita Campbell
[email protected]
330.242.1893
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Credits: Slide # 9, various industry studies including Vantage Partners
Slide #10, Kare Anderson, www.sayitbetter.com, as stated in a Small Business Trends Radio program
© October 2006, Small Business Trends LLC
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