Selection criteria for the right business partnership
We have agreed in my last article before Eid holidays that creating business partnerships is vital today in order for organisations to grow and sustain especially in a dynamic and competitive market today.
Our previous article(s) in this regard also looked into some of the best practices and guidelines of business partnerships and alliances.
This week, my article will revolve around the selection criteria that organisations should follow in order to select the right business partner.
Organisations generally form business partnership with likeminded institutions for primarily 3 different reasons; that is, to create or leverage on a brand, to introduce a new product or service, or lastly to enter into a new market, be it locally, regionally or internationally.
In a business partnership, organisations would want to promote their brand utilising or leveraging on an existing known brand.
They would also pull two or more organisations resources together to create a new product or service as a unique viable solution for the customers.
They would also wish to gain new customers and ultimately new source of revenue by entering into a new unexplored market.
While these all are valuable reasons for one organisation to form business partnership, yet unless an appropriate match or fit is achieved, then the partnership would instead be a disaster per se.
So how does one organisation go about selecting the right business partner? While the below selection criteria may not be exhaustive, yet forms as a base or foundation that one can use on any industry.
1. Vision, Goals and Aspirations
Does the potential partner share the same vision, goals, aims and aspirations you have? This is probably one of the most important items because without an alignment, there is a high risk of failure in the alliance down the road.
2. Trust, Accountability and Reliability.
What’s the reputation of the potential partner in question in the market? Can you depend and are they reliable? Never get into any partnership, let aside business, if there is no trust, honesty and transparency in working together.
3. Knowledge, Skills, Experience and Achievements.
What does the potential partner bring on the table? What new knowledge and skills that you don’t have, and require? What about their experience, trackrecord and achievements already?
Ask for references. It’s very important you evaluate the potential partner value before you on-board or join hands for a mission.
Also, check their local and international experience, especially if you are looking at serving international market. The best fit in my humble opinion is one that compliments another with strength that the other has weakness on.
4. Professional and Financial compatibility
Personal, professional and financial compatibility is very important. The last thing you want is to get involved with something or someone that is not aligned with you, personally or professionally. It may work but won’t be fun or healthy to live with.
Financial discussion, be it from investment capabilities and risk tolerance/appetite etc needs to be discussed as well.
Take this very seriously as it is a cornerstone of a healthy productive business partnership.
Choosing the right business partner can surely make or break a business. Organisations can use the above selection criteria as a base when looking for a business partner.
With this opinion today, I conclude my article(s) on the importance of creating and forming business partnerships.
We looked in the past the benefits, elaborated on best guidelines and have concluded on the selection criteria that an organisation can take in order to successfully create business partnership.
The ball is now on your court to seek, select and on-board right business partner for your organisations. Until we catch up again next week, stay positive.