|
Home / Business / Management
Creating Unique Business Alliances: Six Insights To Help Transform Your Company’s Value
By:Harvey Kraft
Recent news concerning IT industry strategic alliances increasingly trumpet the word “unique” as in ‘unique alliance’ or ‘unique partnership’. Usually these unique arrangements bring together a marketer (either a system integrator or a service provider) with a solid footprint in a niche market and a technology developer or manufacturer with an innovative or proprietary capability.
This type of alliance transfers to the marketer a unique technological edge. The marketer's objective in many such cases is to keep competitors at bay, grow market share or create enough performance value to justify a higher price. For the developer partner, aligning with the marketer provides a significantly extended market reach that simply translates into the sale of an increased number of units as well as a branding leap into greater market visibility.
This deal constitutes an excellent exchange of value for both partners. But as business alliances are not forever, the true assessment of the deal's value must be evaluated over time. In its early days Microsoft supplied DOS in a partnership with IBM's original desktop PC. In time Microsoft’s OS took over the PC market supplying all manufacturers. IBM was forced to back up out of the PC driveway, but it learned the power of partnering brilliantly transforming its business model into the world’s most prolific and successful IT services partnership network builder.
Acquiring a Unique Value Proposition
Of the many reasons for initiating a strategic alliance, the most highly-sought after type is one that creates a “unique value proposition” (UVP) — the three golden words so enticing to venture investors throughout the world.
How do you get UVP if you don't produce it?
A strategic alliance can transform nearly any traditional sales and distribution enterprise into a uniquely positioned provider -- all you need are customers! Have your considered this? Transform your company instantly into an unstoppable juggernaut simply by formulating a strategic alliance with one or more suppliers who may add a unique piece to your package, program or end-to-end offerings. Suddenly, your company acquires a UVP. More orders, greater equity value...before you know it, investors come sniffing around.
What are they looking for?
They want to know what you'll do for your next act.
Sure. That first alliance you just made was a successful move. It got attention. And it’s working. But, don't get too busy with that. Save some time for developing additional alliance ideas. You need to look at your company’s future in terms of a total, long-term strategic alliances plan.
Six key questions to formulating a long-term alliance road map
Use these six Partner M questions to develop your own alliance road map:
- What are my core competencies?
- What are my customer assets?
- How bad are the performance gaps as experienced by my customer/user?
- What are the innovative upgrades desired by my customer/user?
- How well are my competitors performing in areas where we are weak?
- Where do we perform better than our competitors?
Now answer this:
Can you locate and negotiate a deal with potential suppliers who can deliver to you
a unique product or service that:
(a) your company cannot duplicate more profitably with its core competence;
(b) will be highly valued by your customers;
(c) will fix a problem or enable you to offer customers an optional upgrade;
(d) will strengthen an area where you had been weak; or,
(e) will help insure that you can continue to outperform our competitors?
If your answer is yes to any one or more of these options, then you have the basis for a strategy that would result in higher order volume, as well as a path to added value and increased brand equity.
How do you validate that assumption?
Project the pros and cons of executing your alliance plan
Calculate a scenario assuming the amount of revenue you could generate and profits you would achieve after you’ve found one such partner and have successfully negotiated an alliance.
Be sure you have identified and adjusted your projection for any possible downside and cost of implementing the partnership. Next, forecast where you’ll be in three years without this alliance or a comparable strategy.
In addition you should assess the impact of your alliance on the competition with a sober determination of how they may react. Here is where the value of establishing a 'unique alliance' becomes so important. Paradoxically, your alliance's UVP shelf life must be viewed as both temporary and continuous. Any one alliance you enter is temporary. Your strategy must be continuous.
How temporary is your alliance? If any of your competitors can match your partnership with another and duplicate the contribution of your unique ally in fairly short order, your UVP will not last long. You may need to move faster to extend the your UVP shelf life and begin to plan your next UVP partnership. Within this scenario you would need to move faster on the alliance front or find yourself having to play deep catch up if your competitor takes the initiative before you do.
Design an ongoing alliance strategy
To develop a continuous UVP plan extend your alliance road map by duplicating your forecast calculations to include all potential alliances you foresee into the future. How far can you go using this strategy? If possible, don’t stop until you're able to imagine this process reaching a global scale or an exit strategy. Finally, your alliance plan must weigh alliance costs and risks against the benefits/costs/risks of alternative strategies.
Whether your enterprise takes the role of a marketer or a supplier, you should consider formulating a phased-in partnership plan containing a list of target partner prospects, financial validations, a timeline and undertake a marketing initiative aimed at shaping a receptive and synergistic relationship with partner executives and operational teams. Executing the plan is your next challenge. Don't hesitate to seek help in developing your plan and making it happen.
Digg
del.icio.us
Blink
Stumble
Spurl
Reddit
Netscape
Furl
Article keywords: strategic alliance, business partner, value proposition, strategy, unique, deal, partnering, partner, ally
Article Source: http://www.articles2k.com
Harvey Kraft is Managing Director of Partner | M -- partnershipsmedia.com -- the California-based marketing consultancy specializing in executive support for strategic alliances and partnering initiatives. Mr. Kraft is a skilled partnerships executive, author and speaker, and creative marketing director with two decades of senior experience in the media, finance, publishing and wellness sectors.
|
|
| Top Management Articles |
- 1). Nine Reasons Why Mentoring Matters to You By : Kevin
There are many roles we play or hats we wear in our lives. We are professionals, family members, brothers, sisters, co-workers, leaders, coaches, friends, parents, and neighbors to name just a few. While you may not wear all of the hats I listed, you can likely add several more that I left out! Many of these roles are a given – we don’t have much choice of having the role – they come with being a responsible adult.
|
- 2). Project Management - Design and Development Projects By : Michael Russell
There’s no getting away from it, design and development projects are a nightmare to manage successfully, particularly the development of software. Nonetheless, in these days of customers requiring ever increasing functionality and ever more sophisticated technology, they are sometimes necessary.
Your company almost certainly has procedures in place such as Make or Buy (do you design/build the item yourselves or do you sub-contract) and Design to Cost (you’ve estimated how much it will cost, now make sure that it doesn’t run over budget.
|
- 3). Defining Supply Chain Management By : James Hunt
Companies that deal with inventory will have to have some sort of system in place to effectively manage the supply chain that exists for any type of sales. A system of inventory needs to be as smooth running as possible so that a company is able to fulfill all its orders in a timely manner...
|
- 4). Customer Advisory Boards By : Paul Lemberg
Customer Advisory Boards are a great source of information about your market and your business. Their advice is more valuable than any management consultant's. They provide real world counsel on what you are doing right, what you are doing wrong, and most important -how to stay competitive. After all, they're the customer. They're the one's who buy your stuff.
|
- 5). 6 Ways to Maximize Learning By : Steve Kaye
Here's how to gain the most from training events.
1) Know what you want
Before the workshop, set learning goals for yourself. What do you want to learn? How can this program help you? What would make you feel that your time was well spent?
2) Ask for what you want
As the program unfolds, ask questions that guide the presentation toward the information that you need.
|
- 6). Save Face, Time, and Money on Your Next IT Project By : Leslie Whinery
How many times have you been involved in a project where a newly-released piece of software required an immediate enhancement because the right people were not “in the loop”? This is an example of how poor communication costs money and damages the reputation of an Information Technology (IT) Team.
Well-managed communication can increase the rates of success on your IT projects by improving relations between you and your customers and decreasing the odds of hasty last-minute enhancements, thus saving face, saving time, and saving money.
|
- 7). Decision Making "Pub" By : Claude Jollet
This article will help transform your decision making process into “PUB” - Pure Unadulterated Bliss!
Think I'm exaggerating? Well ... maybe just a little!:-) But, see for yourself anyway! You might be in for a pleasant surprise. The way I make decisions in complex situations has – at least – the merit of turning decision making into an effective, satisfying, even reassuring experience.
|
- 8). The CEO is 10,000 feet above the fire By : Larry Galler
How many times have you heard a business owner or manager say that they spend their workday “always sweating at putting out fires?” I hear it all the time.
Think of a raging forest fire. There are sweaty fire fighters working hard, just yards in front of the flames. There is one person in a helicopter 10,000 feet above the flames. Those on the ground and the one in the helicopter are all looking at the same fire but they have totally different views.
|
- 9). CPAs vs. Non-Certified Accountants - Clearing Up The Confusion By : John Day
I wish I had a nickel for every time someone asked me what the difference is between CPAs and non-certified accountants. Essentially, non-certified accountants can simply hang up their shingle and open their doors for business. There are no educational requirements. If they want to prepare taxes, most states require a certain number of qualified hours of study plus continuing education hours each year.
|
- 10). Many Kinds Of Banks - Many Kinds Of Accounts By : Sintilia Miecevole
Sometimes looking into opening an account or accounts in banks can be confusing. There are so many types of banks and bank accounts! Which banks are right for you to open anaccount in? Which types of accounts do you need to open? Below are some simple explanations of several types of banks and the accounts you can open. One will surely be right for you!
There are many kinds of banks:
1.
|
| New Management Articles |
|
|
|
|
|
|
|
|
|
|
|
|
- 7). Double Your Profits with Business Coaching By : Kris Koonar
Business as we all know, involves risk. Since starting up your own business means starting a new chapter of your life, you may fail to recognize a few shortcomings in your business plans, as you are too engrossed and feel that things are going great.
|
- 8). Modern Business Strategies and Tactics By : Kris Koonar
Modern business strategies and tactics often concentrate on developing international brands and products, but before developing any product it is important to assess the potential worldwide demand.
|
- 9). Avoiding Poor Time Management By : ian Williamson
Around midnight students across the country become record setting authors by finishing essays, and study groups for tests in unheard of time. This unnerving process often leads to below average results. Many people wonder why this is happening, the answer is poor time management.
|
|
|
|
|
