A topic that I have brought up a few times with different clients during this last week is the concept of strategic alliances. So, just what is a strategic alliance in business?
It doesn’t matter what business you are in, there are always add-on opportunities for you, or for someone you know, to provide additional product or service offerings to your customers that will be of benefit to them.
As an entrepreneur who has started more than 20 businesses in a variety of fields, I have had to learn the hard lesson that just because I can see an opportunity, or I have a ‘great’ idea, doesn’t mean that I should always go and try to make it happen myself! I already went through my years of thinking that I was invincible and that just because my mindset was strong enough, I could, and therefore should, do anything that would add value to my clients or customers.
Sometimes it is better to maintain your own focus on the things you do well and bring in a specialist or an expert. If I may use the analogy of a football (soccer) match for a moment, in order for a team to get the result, you need a combination of a goalkeeper, defenders, midfielders and strikers. If you try to play all of those roles, even if your name was Lionel Messi or Cristiano Ronaldo, it is unlikely you would succeed. In my current role, however, I have to add that engaging a good coach and mentor who can help you define the big picture and create and implement solid strategies will significantly improve your chances of achieving the results you want.
So what should you look for when trying to decide what would constitute a good strategic alliance and whom would make a good partner with which to form one?
- BE CLEAR ABOUT WHAT YOUR CUSTOMER WANTS AND NEEDS AND WHAT YOU DO BEST
Typically, you start by being clear about exactly what you offer your clients or customers. What is your ‘Unique Selling Proposition’ or USP? In other words, what is it that you differently or better than your competitors and why should the customer choose to do business with you or your company rather than with your enemy?
- IDENTIFY WHAT ELSE WOULD ADD VALUE TO YOUR CUSTOMERS
Once you are crystal clear about your point of difference, ask yourself, ‘What else do my customers want or need?’
Sometimes it may be a product or service that you can provide, but what if it’s not? Or, what if you could provide it, but it’s either: too technical; too costly; requires too much of a drain on your resources (time, money, people or equipment); or it’s simply too distracting from your core business?
So let’s assume that you have found something that is outside your current product and service range, but it may be connected with what you do, or similar to what you do.
For example, a group of my friends have formed a digital marketing alliance. Ming Johanson has a marketing business called OTOTGo and she specialises in Facebook training for business owners; Jo Saunders also has an online marketing business, called Wildfire Social Marketing, but her focus is on training business owners in how to use LinkedIn effectively; Reg Sorrell is an online media strategist who creates videos and trains business owners in how to market effectively through YouTube and with business introduction presentations; Peter Dancewicz has a website design business, so he teaches clients how to maximise the rankings and effectiveness of their social media and website campaigns with effective ‘Search Engine Optimisation’ (SEO) and solid content creation. Together, the four online specialists have united to deliver seminars and educate business owners about how to build an effective online profile. The synergy created by combining their talents helps them edify each other and create a leveraged marketing machine.
‘But aren’t they in competition with each other?’ you might well ask.
In a sense they are, because there will often be overlaps in the advice and knowledge provided. In this case, however, the four of them have adopted the sensible attitude that there is more than enough work to go around for everyone – they have what is often referred to as ‘an abundance mentality’. They have clearly defined their specialist areas and while they could, and often do, offer advice on each other’s chosen topics, they all see the benefits of collaborating and specialising.
Don’t forget that people like to do business with people whom they know, like and trust.
In some instances, one customer will immediately feel that connection and want to do business with YOU, whereas another customer may prefer to do business with one of your associates. Sometimes, it’s as simple as gelling with a person or not.
The alternative philosophy to the ‘abundance’ concept is one of mistrust and fear. People who adopt that approach often lack confidence in their own abilities to generate clients, so they guard their customer base fearfully and often keep their customers in the dark out of concern that an educated customer might leave them. In my opinion, those business owners who educate their clients and become a source of wisdom, advice and support will build stronger, long-term relationships that will represent a ‘win-win’ outcome for both the customer and the service provider.
- IDENTIFY PARTNERS OR ASSOCIATES WHO SHARE YOUR VALUES
This point is based naturally on the pre-requisite that you have defined your own values. Most of the business owners I come across actually haven’t done that. If they’ve even thought about it, they haven’t usually documented it, so that’s one of the areas with which I help many of my clients. If you build your business on a solid set of core values, which by the way should be a reflection of your own personal values, then you will in time build a reputation on which to ‘hang your hat’.
It can take years to build the reputation of a brand, though this can be shattered with one bad experience, so it is imperative that you seek out allies who understand, agree with and actively share your philosophies, principles and values. If you wouldn’t want to do business with these people yourself, why inflict them on your customers?
- FORM ALLIANCES OR ASSOCIATIONS WITH PEOPLE WHO SHARE A COMMON VISION
Another example of an effective alliance is the one that I have made with my friends, Martin Ball and Lauren Marie at YourPeakHealth. The moment I met this couple I knew that we were meant to work together.
Martin is predominantly a fitness trainer and Lauren is mainly a nutritionist, though both love to educate their clients about a holistic approach to health and wellness. My work is in helping business owners or executives to define a long term vision for their life that incorporates their business or career, thus creating a holistic strategy for enjoying a life of purpose that is also balanced. I also educate my clients with the skills and knowledge to progress, as do Martin and Lauren, so it’s a perfect fit to work with these guys.
I work on helping clients to sharpen their mindset, while Martin and Lauren help them become physically fit and healthy, and together, we nourish their souls. We share a common vision of helping people to be the best they can be and to lead happy and fulfilling lives.
- HAVE MORE FUN BY USING THE POWER OF LEVERAGE
If, like me, you’ve read any of Sir Richard Branson’s books or heard him speak, you’ll be aware of this billionaire’s philosophy that business and life should be FUN. In fact, he has so much fun creating and delivering the solutions to Virgin’s customers’ needs and wants that he doesn’t really see a distinction between work and life – he views it as ‘It’s all living’. This is a man who has zoomed in on his values and aligned his life and his work in harmony with the things that inspire him.
One of the lessons Sir Richard Branson learned early on was that you can’t do everything by yourself and that by building a great team around you, you can leverage your way to far greater accomplishments.
So, who else might benefit from strategic alliances? Pretty much everyone, but here are a few examples that spring to mind:
- A real estate agent, a mortgage broker and a settlement agent – (Helping taking a house sale through its stages).
- A financial planner, a management accountant and a tax accountant. (Offering forward planning, progress tracking and historical tax-compliance).
- A finance broker and an insurance broker (Helping you purchase and insure a new asset).
- A food hall (Allowing a group of diners to eat together, yet cater for different food preferences or cultural eating differences).
I’m sure you get the idea. Now what about strategic alliances in life? Well, I’d argue that a marriage or a friendship are both good examples of strategic alliances. You can’t do everything alone – you’ll burn yourself out, trying. Plus, when you pick the right people to hang out with or to do business with, you will bring together unseen and universal forces whereby, when united in a common cause, you all become stronger and more likely to succeed. So, give strategic alliances a go – the concept just might work for you!