Creating a multiplier effect

In a world of increasing technological specialisation, no single vendor can truly offer all things to all customers, so different forms of partnership are common. Even at IBM, the days of replicating every function of our business in all markets are long gone, replaced by a 'globally integrated enterprise' model that relies on collaboration.  Providers of ICT products and services are increasingly willing to try new partnering models, particularly in response to competitive forces and the emerging business models offered by cloud computing. As collaboration becomes more acceptable to providers, I'm often asked how customers can get the most from working with partnered organisations. Stamping out risk Partnerships involve many 'moving pieces', which can understandably appear risky to customers. When presented with a proposal involving partnering, customers typically want to know who owns the relationship, who is responsible for delivering the solution and where accountability lies if the project starts to go downhill. I also recommend customers drill down into the working relationship itself. Ask how the various teams communicate every day, address project delays or resolve conflicts. Do the partners share common business processes? In the case of one lead contractor and a fleet of sub-contracting partners, how are the smaller firms incentivised? Large vendors can be expected to have tried and tested methodologies, some based on LEAN supply chain improvements, for example, to ensure ongoing improvements in working practices between partners. Many CEOs don't want to bet their business on a small operation, but evidence of a formal partnership with a larger firm provides greater certainty that a solution will be delivered and supported long-term.  Stability plus agility The case for partnering is often based on offering the very best technologies, but it goes deeper than that, as the companies themselves have their own strengths and weaknesses. Identify what those complementary skills are and ensure your business can tap into each organisation's strengths. Often a smaller, New Zealand-based provider offers a highly specialised solution, deep understanding of local market conditions and the ability to be nimble and agile. This is especially attractive to customers who want to see 'feet on the ground'. Balancing this, a larger company will bring resources and reliability, including the all-important assurances of enterprise-class delivery infrastructure and security systems.  Global vendors with effective partner management structures can source niche skills and technologies from throughout the world at short notice, giving customers greater choice. Typically, a partner manager is appointed to act as an ambassador and champion for these organisations, which in IBM's case amounts to 120,000 worldwide, ensuring they can be matched with projects. By standing shoulder to shoulder, partnering companies can offer customers a richer and more diverse set of solutions. Relationships for success Customers are often surprised at how easy it is to work with a creative local company that has partnered with a large, international organisation. Don't be put off by the idea – talk about how it could work for you. Success relies not just on the relationships between the partners, but also your relationship with them. Relationships are built on trust, responsibility, dignity, transparency and honesty, and it's vital that these come from both sides. The most successful projects are those where all partners invest in developing a long-term relationship and take joint responsibility for the project outcome. Everyone needs to be on the same page, developing a solution together. You need to know you want to work with both parties and feel a strong connection. Do the organisations share the same ethos and goals as you do? If the partners have worked together before, check that their collective processes fit yours and can adapt as required. Before you sign the contract, look for evidence of a tight working relationship between the partners. Ask for proof that their relationship is working, whether that be references, a proven track record or evidence that they have delivered a similar solution. Large vendors with established partners will have done their homework in getting to know partners' capabilities and experience, operational culture and ethos. The 'status' level awarded to a partner gives a firm indication of the strength of the relationship. Likewise, the number of certifications a partner has shows its level of commitment to understanding a vendor's technologies and processes.  Like all relationships, communication is the key. Lay down the foundation of what works for you. Talk about your culture and your processes and how you see the partners fitting into your business. Take the lead in determining whether you'd like to deal with both partners or just one, and be clear who you are contracting to. Share your experiences of successful and unsuccessful projects and make sure all parties understand how the relationship will work and what the criteria are for success. Championing Kiwi innovation The attractions for global brands such as IBM in working with innovative, nimble New Zealand companies are obvious. They have often developed deep domain expertise and market tested niche solutions that are keenly sought after by customers. Our partners can cover the market in ways we simply cannot. Partnering also shows customers that vendors are prepared to go outside their own organisation to find the right solution. In asking customers to work with multiple providers, we are promising to create a multiplier effect, returning a value that is greater than the sum of the parts. When this is managed effectively, risk can be minimised and customers can benefit from a wider array of choice than New Zealand's small market might otherwise support. Working with a global organisation can provide brand credibility to local companies, opening doors to research, new technologies and customers that just wouldn't be available otherwise. In this way, promising New Zealand technology companies can accelerate their own growth, adding to the vibrancy of the local industry.