Words carry meaning. Or at least they should.
At work, some words -- like “strategic” and “leverage” -- are so over-used they have lost nearly all their meaning. “Partnerships” is another one of these words. In this post we will define the term partnerships and clarify differences among three teams that are commonly tasked with pursuing partnerships: sales, business development and corporate development.
This for That (TfT) will operate on the following definition:
Partnership - an ongoing relationship that creates new value for both (or multiple) people or organizations.
To breakdown that definition:
ongoing relationship - not a one-time transaction but a series of engagements or collaborations that ideally grow in scope and impact over time.
create new value - this could be direct revenue but often partnerships deliver indirect revenue through new product capabilities, increased awareness or entry into a new market.
new value for both organizations - a true partnership is mutually beneficial. However, the benefits to one party may vary over time. In that sense, a partnership between two organizations is much like a relationship between two people. Sticking with the partnership even when the value ebbs and flows is key to what distinguishes a partnership versus a transaction.
or multiple - partnerships are not limited to two parties. Multi-party partnerships are sometimes known as a consortium or industry alliance. These are difficult to initiate and sustain given the challenges of managing competing interests and agendas among multiple organizations.
Intentionally not included in this definition:
cross-functional - most high-impact corporate partnerships require input and support from multiple stakeholders or functions but it is possible for a partnership to be executed by a single team.
function - partnerships are not limited to a sales team or a partnerships team. Partnerships can be led by marketing, operations supply chain or admins.
high-impact - partnerships require effort and they should ideally all be high-impact, but that is clearly not always the case. And we obviously cannot know that at the outset. Partnerships fall along a spectrum (see below).
Elements that are not (necessarily) a partnership:
customer/ vendor / supplier - just because a customer buys a product from another company does not make them partners. Some can be, most are not.
one-time transaction - a single transaction does not make a partnership.
highly-repeatable or formulaic program - this is the "rinse and repeat" phase of customer engagement. It can be a major milestone for an organization to reach this stage but this is not usually the approach that typically drives meaningful partnerships.
no executive input (e.g. standard API integration)