Thinking About Forming A Strategic Partnership?

The cover of one of the early issues of Fast Company Magazine alerted readers to our country as a Free Agent Nation. Many companies today are staying independent but banding with others to work on a project or just to simply complement one another in delivering products and services. Like any relationship-a marriage, a merger, an acquisition-there are things each party can do to keep it working. Here are some tips from business owners who have successfully established and maintained strategic partnerships.

  1. Approach the potential partner as if you were hiring them as an employee-with all the diligence you can muster.
  2. Make sure that the reasons both parties are pursuing the partnership are for the right reasons and that their relative states of health are not too disparate.
  3. Make sure that your core values resonate with one another. Mismatched values have killed more relationships than anyone can count.
  4. Make sure you are comfortable not being in 100% control of something.
  5. Have detailed job descriptions and scopes of work with responsibilities and accountabilities. Track results often.
  6. Agree on a fair and effective dispute resolution strategy outlined in your agreements. And promise to surface issues immediately and not later. The later issues are addressed the more serious they become. Pay particular attention to ownership of intellectual property. Do not allow.
  7. Do not allow discussions of issues to remain at a level of detail where things cannot be resolved, Keep asking, “What do you mean by that?”
  8. In some cases, try a project together before you do a full partnership.
  9. At least once a year, sit down and go over in detail how things are going. Better yet, do that monthly in the beginning and then quarterly.
  10. Keep the term of your agreement short enough so that you reinforce #9.
  11. Remember that success and money change everything. So plan accordingly.
  12. Going slower in negotiations is better than rushing to an arrangement that harms everyone.