Partnerships. What Moves the Needle?
Partnerships are created for many reasons, but the underlying scope is usually to generate growth. This can happen in many ways, like through shared resources, by leveraging on each other’s knowledge or by entering new markets with co-created products and services.
Pandemic outburst has forced many companies to re-think their business models and for those that haven’t done it so far, to consider partnering as a way to surpass the storm and prepare for the future.
But partnerships are so much easier said than done. On paper, on an executive level, or in strategic planning, the solutions seem feasible and expected results are fantastic. Still, more partnerships fail than succeed.
When partners sit down to discuss the objectives of the partnership, they usually choose goals such as reduced costs, customer acquisition or new markets reached. Results are expected to happen quickly. Performance dashboards are in place as of first month and KPI tracking is vivid from day one.
Rarely, however, does a partnership bring any kind of results in the first months or even in the first year. Sometimes, based on the complexity or novelty of the program, substantial results may be seen after two or three years. And the reality is that teams from both sides are confronted with reports immediately after the partnership begins. And these reports show little payoff which usually leads to a loss of belief in the partnership and soon resources and focus are redirected to another project. The final outcome? Indeed, zero results. Resources had been wasted, people had been demotivated and too soon organizations invalidate what could have turned into a route to success, if the necessary amount of time and effort had been given to it.
As Head of Growth I always wanted to understand and find the secret ingredient behind successful partnerships and why some organizations seem to nail it and others don’t. I am far from wisdom, but here are some important learnings that I’ve put together in my years of practice.
1. Successful partnerships always start from a common vision. Partners who understand the importance of a common vision spend considerable amount of time discussing, understanding, and defining not only the vision but also the values and the culture that shape the decisions of each organization and, equally important, how they respond during crisis. The future is unpredictable, so partners need to have the flexibility to quickly adjust their partnership in times of change. If vision, culture, and values are not aligned, changing contexts will disrupt the partnership up to the point where it will dissolve.
2. Don’t cut short on the discovery phase. All our innovation projects start from a discovery phase; a blank sheet of paper that reminds us we should “stay foolish”, to quote Steve Jobs, and be open to accept that what we know may no longer be true. Partnerships usually start from a common hypothesis about the future, a hypothesis that both partners embrace. But the way partners understand and relate to this hypothesis may be different. Just like investing time to understand and internalize each other’s’ culture, the same way teams should take the time to discover and define, or in some cases redefine, the hypothesis that has brought them together from the very beginning. Along this discovery phase, the hypothesis may change. Don’t be afraid of that. It is better to go back to management team and say that the hypothesis is different than to work in misalignment or on a wrong route from the very beginning.
3. Instead of focusing exclusively on final outcomes such as money, sales or savings, successful partners define smart ways in which to measure the actions and the factors that will lead to performance. Good results on these interim metrics will sustain the corporate commitment and the team’s spirit precisely when the projects are in the “unknown zone” and there is doubt about how the financial outcome will look like.
4. Align, align and align again. Just because partnerships started from a common objective or teams measure same KPIs, it doesn’t mean that teams at all levels are aligned. Alignment is crucial, not only between partnering organizations but also between management team and execution team within the same organization. Alignment is a complex matrix; it is hard work and unfortunately the process is treated in most cases with superficiality. How it happens in practice is that companies set up these dates when teams meet and discuss projects. And everybody wants to polish results and be polite. Frictions, tensions, bottle necks are rarely discussed at executive level and superficially treated at execution level. There is no “one fits all solution” but there are at least two key ingredients that I know for a fact that work: constant communication at all levels (formal and informal) and creating a safe environment for truthful and candid feedback.
5. Be more than partners, be a community. One of my colleagues once said to me: “I am a pragmatic person. I don’t go to work to make friends; I go to work to get things done”. I never argued and I will never argue with the way people choose to create work relationships. But I know that problems arise, failure happens, and projects are under constant pressure. A team culture focused on getting things done is the least enduring one when things get tough. Successful partnerships thrive when teams become communities. Trust and respect are key ingredients, earned in time; it is not something you can mandate once the project begins. As soon as people begin trusting and respecting each other, the community becomes vivid with ideas, solutions and they get things done; but they do it as one body, a team where everyone’s passions and accomplishments are valued and acknowledged.
What moves the needle when it comes to partnerships? My answer now is understanding that partnering is not an activity or a project, but a business model, a business philosophy that requires time, investment, commitment, and most importantly dedicated people from executive levels to implementation teams.