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BLOGReducing Your Costs with Partnerships

by Randall CraigFiled in: Make It Happen Tipsheet, Blog, Digital Strategy, Strategy

Very often, partnerships exist to grow the top-line. But there are two other types of partnerships that are equally valuable: downstream delivery partnerships, and broader offerings partnerships. Each has the potential to build organizational sales, while at the same time building the capacity to delivery.

Reducing Your Costs with Partnerships

  1. Downstream delivery partnerships: These are partnerships that focus on what happens “after” the sale. This could include implementation assistance after selling a software license, compliance monitoring after an audit, or outsourced web hosting after the development of the website. This type of partnership allows your organization to leverage specialist skills elsewhere, and maintain focus on your core. It also allows you to avoid the massive investment required for geographic (or different industry) coverage.
  2. Broader offerings partnerships: These are partnerships between organizations where there is a complementary “fit” between their mutual offerings, and where the ultimate customer will need both in order to successfully solve their problem. An example of this is a consulting firm that provides a solution that involves services (which they provide), processing power (from a cloud services provider), and software (from a software house.) Without all three components, it would fall to the customer to cobble them together and assume all project risks: the sale would be much more difficult. This type of partnership provides two key benefits: (1) an easier “integrated” sale to the customer; in fact, without the other partners’ offerings, the sale may not even have taken place. And (2) each of the other partners may actually bring you into their deals.

This week’s action plan:

Depending on your industry, most of the partnership thinking is tactical, not strategic. This week, canvas through your organization, and identify any informal partnerships that exist. Is there a common theme that suggests that a more formal strategy is merited? You may find that there are people using unique partnership approaches that might be shared more widely?

Partnership Insight: It doesn’t matter how structured a partnership is, how well documented it is, and how often its existence is communicated. Partnerships function when there is a connection between people. If you want a partnership to bear fruit, focus on the individual, one-to-one relationships.

Related posts: Value Chain: Upstream-Downstream Analysis

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