What is Corporate Partnering?
It is joining with one or more partners to share resources, risks, and rewards from a joint enterprise. Corporate Partnering can take any of a number of forms such as: a strong relationship with a major customer, a partnership with a source of distribution, a relationship with a supplier of innovation or product, or an alliance in pursuit of a common goal. Sometimes partners will form a new jointly owned company. In other instances one partner purchases equity in the other. Most often the relationship is defined by a contract.
What makes Strategic Alliance Partnering so important?
It's the quickest way to grow a company, particularly in times of change. Partnering has proven itself one of the most powerful business tools for dealing with fast changing markets, technologies and customers. Fortune Magazine called the 1990s "the Decade of the Strategic Alliance." As the global economy speeds up, corporate partnering is becoming the weapon of choice for today's successful competitors. The Internet has taken this trend and accelerated it.
In what industries is partnering most common?
It is no coincidence that partnering is most common to industries experiencing rapid change. There is a direct relationship between the rate and scope of change within an industry and the amount of corporate partnering that occurs in that industry. Think about it. Look at the computer industry. Look at electronics, communications and health care. Companies in these industries are vigorously developing webs of strategic alliances, joint ventures, technology licensing deals and consortiums. The industry with the greatest amount of change, the Internet, exhibits the greatest amount of partnering.
What are some examples?
We are seeing more and more of these collaborative business arrangements every day. They go by many names.Hereare a few:
- Strategic Alliances, Joint Ventures, Strategic Partnerships, Business Partners and Alliances, Partnering Agreements, Business Coalitions
- Just In Time Suppliers and Relationships, Sole Source Suppliers, Outsourcing
- Keiretsu, Zaibatsu, Shudan (traditional types of Japanese corporate partnering)
- Technology and Product Licensing, Joint Development, Technology Sharing and Cross Licensing Agreements
- Business Partners, Affiliates, Franchises
- Value Added Remarketers and Resellers, Value Added Dealers, Distributors, OEM Suppliers and Customers, VAD, Distribution Relationships, National Accounts
What is the most common type of Corporate Partnering?
The most common type of partnering continues to be the traditional Junior/Senior partnering.
Here a Junior Partner has a new product or technology - but poor distribution and limited capital.
The Senior partner has superior distribution and/or access to capital. Each partner has what the other needs. Each improves its competitive position by exchanging the resources it has for the resources it needs.
What is the driving force that is causing the recent upsurge in partnering?
Few companies have everything that they need. You may need money, customers, or product. No matter what you need, there is someone who has it. You can either buy what you need or partner for it. Partnering is frequently quicker and less costly.
While avoiding difficult and time-consuming internal changes, partnering allows you to:
- Rapidly move to decisively seize opportunities before they disappear.
- Respond more quickly to change with greater flexibility.
- Increase your market share.
- Gain access to a new market or beat others to that market.
- Quickly shore up internal weaknesses.
- Gain a new skill or area of competence.
- Succeed although your company lacks otherwise key resources.
It is joining with one or more partners to share resources, risks, and rewards from a joint enterprise. Corporate Partnering can take any of a number of forms such as: a strong relationship with a major customer, a partnership with a source of distribution, a relationship with a supplier of innovation or product, or an alliance in pursuit of a common goal. Sometimes partners will form a new jointly owned company. In other instances one partner purchases equity in the other. Most often the relationship is defined by a contract.
What makes Strategic Alliance Partnering so important?
It's the quickest way to grow a company, particularly in times of change. Partnering has proven itself one of the most powerful business tools for dealing with fast changing markets, technologies and customers. Fortune Magazine called the 1990s "the Decade of the Strategic Alliance." As the global economy speeds up, corporate partnering is becoming the weapon of choice for today's successful competitors. The Internet has taken this trend and accelerated it.
In what industries is partnering most common?
It is no coincidence that partnering is most common to industries experiencing rapid change. There is a direct relationship between the rate and scope of change within an industry and the amount of corporate partnering that occurs in that industry. Think about it. Look at the computer industry. Look at electronics, communications and health care. Companies in these industries are vigorously developing webs of strategic alliances, joint ventures, technology licensing deals and consortiums. The industry with the greatest amount of change, the Internet, exhibits the greatest amount of partnering.
What are some examples?
We are seeing more and more of these collaborative business arrangements every day. They go by many names.Hereare a few:
- Strategic Alliances, Joint Ventures, Strategic Partnerships, Business Partners and Alliances, Partnering Agreements, Business Coalitions
- Just In Time Suppliers and Relationships, Sole Source Suppliers, Outsourcing
- Keiretsu, Zaibatsu, Shudan (traditional types of Japanese corporate partnering)
- Technology and Product Licensing, Joint Development, Technology Sharing and Cross Licensing Agreements
- Business Partners, Affiliates, Franchises
- Value Added Remarketers and Resellers, Value Added Dealers, Distributors, OEM Suppliers and Customers, VAD, Distribution Relationships, National Accounts
What is the most common type of Corporate Partnering?
The most common type of partnering continues to be the traditional Junior/Senior partnering.
Here a Junior Partner has a new product or technology - but poor distribution and limited capital.
The Senior partner has superior distribution and/or access to capital. Each partner has what the other needs. Each improves its competitive position by exchanging the resources it has for the resources it needs.
What is the driving force that is causing the recent upsurge in partnering?
Few companies have everything that they need. You may need money, customers, or product. No matter what you need, there is someone who has it. You can either buy what you need or partner for it. Partnering is frequently quicker and less costly.
While avoiding difficult and time-consuming internal changes, partnering allows you to:
- Rapidly move to decisively seize opportunities before they disappear.
- Respond more quickly to change with greater flexibility.
- Increase your market share.
- Gain access to a new market or beat others to that market.
- Quickly shore up internal weaknesses.
- Gain a new skill or area of competence.
- Succeed although your company lacks otherwise key resources.