Cultivate Effective Strategic Alliances
| Category: Home Based Business | Date: 2001-11-05 |
Strategic alliances are the smart way to grow a small business. Small entrepreneurs can form strategic alliances to shore up or enhance their competitiveness in the marketplace. Here are some tips that would enable small business entrepreneurs involved in alliances to leverage those relationships for maximum advantage.
Communication is the key. While it is not vital that each partner's goals be identical, each must be committed to a common outcome. Half of all partnerships never live up to expectations. Be honest about what you seek to gain, and what you can provide. The most common mistakes are failure up front to clearly articulate the value proposition of the alliance, mismatched goals, insufficient commitment, and inability to adjust the relationship to new business realities and flat out neglect by upper management.
Look for situations that are win/win for both parties. Participate only if you can maximize the relationship; and never when you think that the partnership cannot support your business goals.
Even though your companies may be small, read carefully around sharing information related to fees. You don’t want to find your company accused of price fixing. The kind of knowledge sharing that takes place between partners is essential to projects built for customers.
When cultivating relationships with large corporations, make sure that you have connections with several people in the company. Think of what would happen if your sole contact left your company may be dropped at the next contract negotiation.
Be creative when exploring alliances there will certainly be opportunities where your unique business is a natural partner for a strategic alliance.
When in doubt, consult your attorney or accountant about any gray areas of your strategic relationships.
Keep the end in mind: You are partnering with another company to expand your business and to increase your cash flow by pooling financial and managerial resources. If you have formed more than one alliance know as much as possible about your alliance portfolio and determine how the next alliance will fit into that portfolio.
Determine which direction your alliance portfolio is taking your company. Terminating some alliances may be beneficial if they are likely to lead to dependence in the long run. develop in-house capabilities simultaneously with your alliance portfolio. Remember that your firm is viable only as long as it maintains its competitiveness. Rather than depending entirely upon an alliance portfolio to sustain or improve the firm's competitiveness in the market, retain some independence by bolstering the firm's own capabilities and skills, creating the force of attraction instead of constantly being attracted by other firms.
About the Author
Isabel M. Isidro, Power HomeBiz Guides. For more articles, visit Power HomeBiz Guides at powerhomebiz.com. PowerHomeBiz.com is an online magazine designed to stimulate your entrepreneurial mind. We make small business do BIG business. To subscribe to the bi-monthly newsletter, send email to newsletter@powerhomebiz.com.
:To contact see details below.
editors@powerhomebiz.com
http://www.powerhomebiz.com/
Communication is the key. While it is not vital that each partner's goals be identical, each must be committed to a common outcome. Half of all partnerships never live up to expectations. Be honest about what you seek to gain, and what you can provide. The most common mistakes are failure up front to clearly articulate the value proposition of the alliance, mismatched goals, insufficient commitment, and inability to adjust the relationship to new business realities and flat out neglect by upper management.
Look for situations that are win/win for both parties. Participate only if you can maximize the relationship; and never when you think that the partnership cannot support your business goals.
Even though your companies may be small, read carefully around sharing information related to fees. You don’t want to find your company accused of price fixing. The kind of knowledge sharing that takes place between partners is essential to projects built for customers.
When cultivating relationships with large corporations, make sure that you have connections with several people in the company. Think of what would happen if your sole contact left your company may be dropped at the next contract negotiation.
Be creative when exploring alliances there will certainly be opportunities where your unique business is a natural partner for a strategic alliance.
When in doubt, consult your attorney or accountant about any gray areas of your strategic relationships.
Keep the end in mind: You are partnering with another company to expand your business and to increase your cash flow by pooling financial and managerial resources. If you have formed more than one alliance know as much as possible about your alliance portfolio and determine how the next alliance will fit into that portfolio.
Determine which direction your alliance portfolio is taking your company. Terminating some alliances may be beneficial if they are likely to lead to dependence in the long run. develop in-house capabilities simultaneously with your alliance portfolio. Remember that your firm is viable only as long as it maintains its competitiveness. Rather than depending entirely upon an alliance portfolio to sustain or improve the firm's competitiveness in the market, retain some independence by bolstering the firm's own capabilities and skills, creating the force of attraction instead of constantly being attracted by other firms.
About the Author
Isabel M. Isidro, Power HomeBiz Guides. For more articles, visit Power HomeBiz Guides at powerhomebiz.com. PowerHomeBiz.com is an online magazine designed to stimulate your entrepreneurial mind. We make small business do BIG business. To subscribe to the bi-monthly newsletter, send email to newsletter@powerhomebiz.com.
:To contact see details below.
editors@powerhomebiz.com
http://www.powerhomebiz.com/
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