Alliances & Partnerships seem such an easy way to grow an organisation. However, much the same as constructing a high-rise building, alliances and partnerships require a solid foundation to be able to deliver promising success. Unfortunately, that element is often overlooked.
An essential part of creating a solid foundation is conducting proper partner analysis. During this phase you analyse potential candidates for the best fit; from a financial perspective, a strategic perspective and an operational perspective. Ideally, you would then approach the organisation you felt was the best fit and begin partnership conversations.
In many cases, the partner analysis process is skipped due to a number of reasons. It might be that there’s only one partner available, or that the partner has already approached you, or that your CEO has already made an agreement to team up with the partner. Additionally, I’ve seen many situations whereby people take the opportunistic approach and forget about the partner assessment because the partner has the right product. However, like in mergers and acquisitions the due diligence or partner assessment phase is an essential part of the “dating” stage. You have to get to know your partner better before you move on to the next stage in your relationship!
Research shows that the companies that follow a structured alliance management process consistently report a better success rate with their alliances than average. Partner analysis is an essential element of a structured alliance management process based on the so-called alliance lifecycle.
Do you really need to perform partner analysis? It’s all up to you and how successful you want to be with your alliances & partnerships! My strong advice is to always perform partner analysis. Albeit only to understand where your partner may be different from your own organisation. It is these differences between organisations that you will proactively need to manage in order to succeed during the operational phase of your partnership.