Why Strategic Alliances Are Important In Today’s Business Climate

A conversation between Dede Haas and Peter Simoons

Dede Haas, channel sales strategist and coach, and Peter Simoons, executive coach and alliance mentor, have known each other for quite some time. Both were members of the Association of Strategic Alliance Professionals and have talked many times about the differences between strategic alliances and channel sales. Dede and Peter recently took time to talk to The Business Solutions Network about strategic alliances and more in this exclusive interview.

Click here for part one of this conversation.

Dede: And so, this is interesting. Everything that we’re talking about that was in your book and what’s happening today, as well as how Amazon in this example could be very well responsible for some of these smaller companies looking for other partnerships. Something that maybe they hadn’t thought about before.

Peter: I agree. Also when you’re in a partnership, you need to keep it healthy and constantly be looking around what’s happening. It’s not a matter of reluctantly lean backwards and say, “Well, I’m in the partnership. I’m there,” because you’re never there. Things change. Markets changed. The world changes and you constantly need to be aware of what can happen to your business and your partnership.

Dede: Well, it’s like any relationship. You can’t just lean back and go, “Okay. I don’t have to do anything for you, but we’ll still be friends.”

Peter: Yeah, no, then the friendship will decline definitely.

Dede: So going through some of the other things that you had mentioned in your book, is coming to the definition of what a strategic alliance is. We’ve been talking about all these different partnerships and we talked about teaming, and then you have mergers and acquisitions.

Peter: M&A, mergers and acquisitions for me is not a strategic alliance and vice versa. These are two different relationships in the whole spectrum, the whole collaborative business spectrum. I would say that M&A is on the completely right side: We will select you as a target. If it works, we will acquire you and integrate you. Sometimes companies don’t integrate, but mostly they do. Whereas in partnerships, we will look for a suitable partner and we will work together for a certain amount of time. M&A is definite. With M&A that’s the end of your company, it’s an integration into another company. So, an alliance, a partnership, is for me a cooperation between two or more organizations with the aim to achieve a result that one of the parties cannot achieve alone or not easily achieve alone.

Dede: And I think that people throw the term strategic alliance around a lot.

We talked about that in the beginning: they throw this term around and they apply it to M&A, joint ventures. And so, what you have said essentially, again, what a strategic alliance is, it’s – and I’m reading this from your book – “it’s a strategic cooperation between two or more organizations with the aim to achieve a result one of the parties cannot easily achieve alone.”

And I’m just repeating that because I think that that just gets kind of left out there and people just keep wanting to say, “Strategic alliances” and they’re meaning something else.

Peter: Yeah, what I do in workshops, it’s also breaking this apart a bit. So, I emphasize the word “strategic,” which means it’s important for our organization for the long-term results. In other words, a strategic alliance by definition has a focus on the long term. It’s a cooperation. So, there cannot be one party who says, “Well, this is the way we’re going to do it. And you will work with me in my way,” because then it’s not going to work like in any relationship. It is two or more organizations. To emphasize that in a workshop, we mostly focus on the two organizations to keep it simple, but it can be multiple organizations that work together. To achieve a result that we cannot or cannot easily achieve alone. In other words, if we can do it alone and we don’t need anybody, why would we work together? It is good to work together and, in many cases, it’s more efficient to work together, but if it’s not more efficient, managing a partnership, managing a relationship, will cost time and effort. So, if you can do it alone as effectively as together, don’t team up with somebody else. Do it alone.

Dede: Well, I think that that’s a great explanation about strategic alliances and something that drills down and gives a much better idea of what they are instead of throwing that term as an umbrella term for so many other things. And I’m going to suggest that the next time we chat will be on what strategic alliances and channels are and what their differences are and why you would partner in a strategic alliance?

Peter: Sounds like a good plan to me! There are several reasons to team up in a strategic alliance. Ah, I caught myself abusing the term, the word “team up” like your teaming agreement in D.C. But actually, that’s what partnering is. So, why would you partner in strategic alliances with another company? And there are several reasons, although in the next occasion that we talk, I will highlight the three main reasons for teaming up with other companies.

Dede: Yes and for the benefit of those who are reading the article that would be: knowledge transfer, market development and efficiency. And that’s what to look forward to.

A great conversation, Peter.

Peter: Thank you, Dede. It was good to talk to you.

 

This article was published first on January 23, 2020 at MSPinsights


Check out some other articles

Alliance Masterclass