Forming strategic alliances can lead to game-changing growth and innovation. However, transforming an initial partnership idea into a successful long-term alliance requires dedication and alignment across multiple functions.
Where should you start when building an effective tech partnership?
In this session called “Strategic Alliances: Where to Begin,” we brought together a panel of experts to share advice on strategic alliances. Joining this session is host Deven Revel of Hightouch, Vikram Ghosh of GitKraken, Amy Deora of dbt Labs, Jim Misuraca of RainFocus, Jennifer Kijek of Fēnom Digital, and Gautham Pandyan of Qualtrics.
Here are the most pressing insights from the panel that reveal key elements that set partnerships up for success.
More Than Just Revenue Generation
Many companies first consider partnerships as a way to directly boost revenue by accessing each other’s customers and markets. However, strategic alliances can deliver benefits that go beyond the sales line.
“The reason I call it strategic is there’s an outcome that is more than just driving revenue or tying on to a big name,” said Ghosh. He noted that these partnerships can raise broader awareness about your brand, capabilities, and vision. They signal innovation and leadership in your market.
Strategic alliances also enable complementary technology investments that would be infeasible alone. Partners can co-develop assets that pay dividends down the road, such as:
- New products
- Useful features
- Practical integrations
And the relationships formed between executive teams during an alliance can pave the way for more significant combinations through joint ventures or full mergers and acquisitions. So strategic partnerships can set the stage for long-term growth beyond initial projects.
The outcomes from strategic alliances are multifaceted. Consider this bigger picture when considering potential partners beyond short-term sales impacts. Think long-term about brand, innovation, and growth potential.
Three Elements of a Successful Strategic Alliance
Clearly, strategic alliances can deliver significant value. But what specific elements contribute to success? Here are recommendations based on our panel’s experiences.
1. Long-Term Investments and Buy-In
“I think the most important piece is the ability of the business to make longer-term investments,” noted Deora.
Strategic alliances require dedication and commitment from both partners consistently over an extended period. These are not quick partnerships to generate short-term gains. Instead, actual results come from a willingness to devote resources and leadership attention over years rather than months.
In addition, strategic alliances need cross-functional buy-in and communication within each partner company.
As Misuraca put it, “If you don’t have cross-functional understanding and concurrence of a partner strategy… you’re dead in the water without getting there first.”
Securing upfront alignment across departments like Sales, Marketing, and Product is vital.
2. Engagement Across Business Units
Many of our experts emphasized that a successful alliance requires engagement from multiple departments. As Kijek said, “Our most successful strategic alliances are when the partner has their own internal KPIs tied to partner success.”
Establishing shared key performance indicators (KPIs) forces coordination. But this level of cross-business unit participation takes vision and effort to orchestrate. When done effectively, it cements the commitment to mutual goals.
3. Concurrence on Goals and Communication
Anchoring the partnership around a clear value proposition and strategic rationale resonating with both parties is vital.
“Start with gaining agreement upfront and then honestly communicate the progress.” Pandyan said. He noted, “If you’re not adequately communicating that to sales and your solution consultants, you’re not making nearly the impact.”
Maintaining transparency around objectives and achievements is crucial for alignment.
The Importance of Values Alignment
Strategic alliances also rely heavily on shared values and mindsets between partners. Beyond business objectives, it’s crucial that partners demonstrate ethical alignment and care around social impact.
Companies with common commitments to sustainability, diversity, equity, and inclusion can reinforce these efforts through alliance activities.
Examining Sustainability Commitments
“It’s really important that you feel good about doing business with your partner,” said Deora.
Partners should have open conversations to assess each other’s dedication to environmental stewardship and ethical sourcing.
Comparing track records around energy efficiency, waste reduction, supply chain oversight, and governance provides insight into compatibility. Partners with shared passions for sustainability can make ambitious pledges to further eco-friendly practices.
Enabling Diversity and Inclusion
Partners should also align on diversity and inclusion philosophies. Initiatives like equal family leave policies, affirmative recruitment and advancement of underrepresented groups, and mandatory bias training demonstrate commitment.
Partners can agree to promote diverse leadership exchanges, coordinate inclusion events, and publish joint diversity reports. This builds on each company’s efforts.
Conclusion
Building successful strategic alliances is multi-dimensional. It requires dedication, communication, cultural alignment, and a willingness to invest time and resources. Partners must establish a unified vision and governance model. Cross-functional collaboration and KPIs keep efforts aligned. Resource commitments demonstrate a focus on long-term growth rather than quick returns.
So, take the time upfront to lay the groundwork for impactful alliances that transform both businesses. While the journey takes work, the rewards justify the effort.
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