Do You Have a Dance Partner?
Partnerships and strategic alliances as integrated elements in your business model are important and often overlooked opportunities to innovate and capture new growth for your business. There are many different reasons that a partnership or alliance incorporated into your business model can be beneficial.
Just a sample of a few of the options for potential innovation through alliances and partnerships follow (and look for future posts with more examples or get them delivered to your mailbox by subscribing to the Lumen Insights blog updates):
- Faster time to market yielding the opportunity for earlier market traction and first mover advantage;
- Enhanced completeness of the offer through the alliance shoring up competitive separation and differentiation for your offer;
- Greater reach supporting access to a larger set of potential clients;
- Complimentary skills or features which would be costly for your company to develop on your own, thus driving up the overall price for your offer;
All of the above, and many other just like them can be sources of value for your business. However, possibly the most powerful reasons for partnerships and alliances are those that support incremental value from the perspective of the customers’ point of view. Consider your current offer in the marketplace and ask yourself these questions:
Is it difficult for my customer to consume my offer in a way that is beneficial to them?
- Does it require that the client’s employees garner new skills or modify their skills to glean value from the offer?
- Does it require a significant amount of time to integrate into their current business workflow and no one has that time?
- Does it not yield value at all until coupled with another offer element from you or another company?
- Does its introduction into their environment cause them to change something else already in place that is adjacent to or dependent upon your offer’s function?
Is my offer potentially perceived as or actually disruptive to relationships with other vendors that my customer might have that they will be reluctant to change?
- Are there contractual obligations that would be disrupted or be costly to exit?
- Is there a trusted advisor that has been established overtime that could stand between your offer and the client?
- Does my potential customer prefer working with local resources or existing preferred vendors?
Is my offer cost prohibitive to a segment of the market and as such not valuable to that segment?
- Are there economies of scale that are not possible that could be overcome to reduce costs?
- Are there implications in other parts of the business that drive the total cost of owernship of my offer up beyond feasibility in its current form?
- Are their financial limitations – capital verses expense – that reduce the value of my offer for potential clients?
If you answer yes to any of the questions above, the next step in your pursuit of innovation gold mines may well be exploration of a strategic alliance or partnership with which you go to market or integrate into your offer. In the next post this week, we can explore some examples of alliances that in fact have yielded enhancements to the value from the customers’ perspectives and subsequently increased a companies success in the market. What are your perspectives on thinking about alliances and partnerships as options starting with the customers’ needs in mind?