Competitor or Collaborator: Creating Strategic Alliances
Companies with complementary services who do not directly compete can often benefit from creating a strategic alliance with one another. Rather than treat every company as the competition, envision the opportunities that may exist when you combine brand recognition, technical strengths, or corresponding skill sets.
Criteria for Successful Strategic Alliances
For a strategic alliance to be successful, each business involved must benefit. The alliance should:
- Serve the established objectives of the organizations. An alliance only works if it furthers the organizations along in their respective efforts to build their brands. If the alliance pulls money, attention, or time away from core objectives of either organization, it’s not the right match.
- Strengthen both organizations in ways they could not achieve independently. If an organization can achieve the same goals with their own team, an alliance is not necessary.
- Fill a gap in the core competencies of each organization. The alliance should create something unique from the strengths of each organization that expands the reach of both or makes them accessible to new audiences.
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- Select the right partners. For example, Uber partnered with Pandora to make it possible for customers using Uber to listen to their own Pandora playlists during their rides.
- Choose alliances in which benefits outweigh risks. Both brands should experience an increase in brand awareness and the ability to innovate.
Strategic alliances have the potential of strengthening both organizations, but as you would in any relationship, you need to carefully assess the benefits and risks before making a commitment. It is essential that each organization brings equal value and gains equal benefit from the alliance.
As the CEO & Founder of East Tenth Group, Michelle leverages 25 years of business and experience as a strategic advisor and executive coach to help drive actionable people solutions and provide practical insights on business strategy to senior leaders. she and her team and are fiercely committed to the development and growth of people and companies because we believe that when people thrive, business thrives.
