5 necessary elements for launching a winning partnership
When you read headlines about companies joining forces for a strategic partnership, they typically sound very straightforward, even obvious. What could be so hard?
From leading a strategic partnerships team within a Fortune 100 company’s Corporate Development organization, I’ve learned it’s easy to imagine the news headline with a partner - but cultivating a meaningful partnership is often a massive mountain to climb. Here are 5 elements needed to seed, execute, and grow a successful strategic partnership.
1. Mission alignment
Being “mission-aligned” is simply shorthand for saying you have a common goal, shared values, and a noble purpose that transcends your company, or yourselves.
My team at Nationwide has found ideas flow more naturally when partner missions align with ours – protecting people, businesses and futures with extraordinary care. And when there are shared company values and a focus on customer centricity, the design and execution of those ideas come more easily.
2. Shared customer need
Addressing a meaningful customer problem that both companies want to solve is a necessary precursor to identifying value creation opportunities together. This is true regardless of whether you are solving a B2B, B2C, or internal customer problem.
Embedded experiences are our primary path to protecting our partners’ customers. When our partner has a customer with an insurance protection need and we can embed in the partner’s experience at the moment of need, then we all benefit – the partner, your company, and most importantly, the customer. At Nationwide, we have examples of this across auto, home, renters, life, travel, and pet insurance.
Clarity on target customer and insights can prevent misalignment as the deal structure takes shape. Our most successful partnerships start with an aligned mission and clear customer problem, then we look for ways to bring our capabilities together to solve that customer need in the most elegant way possible.
3. Complementary capabilities and processes
Consider the capabilities required from both partners early in the design process to successfully deliver the best solution together. Most of the partnership activation Nationwide drives is digital in nature, so finding partners who are also digitally-savvy is important for successful execution. Nationwide built a market-leading partnership platform that houses our APIs, integration patterns, and operational enablers. It’s been a game changer for us and has received significant industry recognition. As we have activated this platform in-market, we’ve learned there needs to be a base level of technical maturity on both sides to execute on embedded insurance or data sharing partnerships.
It’s also important to consider complementary capabilities or assets that aren’t technical in nature. Strong consumer brand, risk models, customer access, and standardized contracts are examples that can lead to market differentiation and efficient execution.
4. Meaningful business outcomes
Explore the feasibility of your partnership opportunity to avoid the risk of jointly investing time and money in something that won’t generate a meaningful return to either partner. This can be a balancing act - you don’t want to overthink early-stage business cases when testing into a new market or solution.
One thing is certain – the financial model you build will be wrong. Make sure the model is predicated on a joint set of aligned assumptions you can track against with your partner. It is critical to understand how your partner measures success to avoid contradictory goals on both sides. We like to get the target business outcomes for each party on the table as early as possible.
5. Strong relationships and trust
Starting with just one meaningful initiative that can be executed quickly together is a great way to determine if the company cultures and teams will be successful with larger initiatives in the future.
The flip side of winning together early is facing adversity together. I have yet to see a partnership that doesn’t encounter a challenge along the way. Mis-stepping and being transparent or realizing you started in one place and need to pivot builds trust and momentum when you come out the other side.
Trust is also fostered by thinking about how you can help each other beyond a specific opportunity. We recently hosted a dinner where we brought several partners together allowing them to connect in an informal setting, which we all found value in. Being willing to share your relationships and create broader ecosystem value is an awesome trust-builder.
Stretching beyond digital interactions and finding the right times to be together face-to-face is the ultimate relationship builder. We like to structure these visits with a balanced combination of getting work done and having some fun. Every partner defines this differently, but breaking bread together, whiteboarding your ideas, or attending sporting events are all ways we’ve truly bonded with partners and created a joint, vested interest in our mutual success. Human relationships are the X-factor for successful partnerships.
Leading Strategic Partnerships has been one of the most energizing endeavors of my career. Seeding a partnership, activating it to attack a problem together, then evaluating the benefit delivered to customers, partners, and our company on a path to growth and scale is quite exciting. Catchy headlines are great but collaborating with passionate partners to solve problems for our customers is the real win.