Today’s guest blogger is Eric Snethkamp, global channels & strategic alliances manager for SafeGuard Global. For nearly a decade, organizations around the world have relied on SafeGuard Global for their global HR needs, specifically around payroll and employee compliance. SafeGuard Global is an Alliance Partner of NPAworldwide.
Strategic alliances, strategic partnerships and joint ventures can have considerable impact on an organization. Large-scale growth, shifting marketplaces, and new ways of doing things can be the difference in a company becoming or remaining a market leader.
And, because the impact can be a game changer for one or both partners in a very positive or very negative way the selection, implementation and management of these partnerships requires dedicated focus.
1. Access to a Larger Client Base
In todays’ global marketplace customers demand more. They expect new products, new services and new methods of delivery. They also expect new things quickly and regularly. Strategic alliances can be a rapid source of customer-centric offerings, expanding the target market and available customer base.
New markets may be accessed through a strategic partnership with a complimentary partner. Jointly offering products or services can be an incredibly effective method of expanding the reach each partner has into new markets and their access to previously untapped customer populations.
2. Restructuring the Market Space
Joint ventures and alliances can result in a rapidly increased market share through expanded client bases, expanded sales paths, increased visibility, additional marketing tools and larger target customer populations.
The potential conversion of competitors into partners shouldn’t be overlooked either. Two firms who may have been competitors in many ways can (and have) found grounds on which to partner, completely shifting the market space.
3. Sharing the Risk / Reward
The expense of operating any business could see considerable positive impact by way of an alliance where expenses are shared to grow market share or delivery of a product or service. Such an alliance can result in an obvious impact on the revenue of both partners.
When both partners share the risk, the potential impact of negative events can be mitigated. Again, the focused management of strategic alliances is paramount as both partner reputations are on the line.
This plays directly into image. The image and visibility of one or both strategic partners can see a sudden large scale increase with a direct impact on revenues.
4. Innovation
Innovation is often difficult and costly, but almost always necessary to stay out in front. Strategic alliances can be a solution when innovation can’t be built by a company internally or can’t be bought by a company through acquisition.
The shared knowledge and expertise that is regularly an integral part of a successful strategic alliance leads directly to innovation as well. The sharing and protection of intellectual property (IP) plays a large role in strategic partnerships and once again calls for dedicated and expert management of these relationships.