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Adam Goodvach
With 10 years in sales & partnerships for his start-up and 5 more with major enterprises, Adam knows winners transform key relationships into great PARTNERSHIPS

Art of Partnerships (3): How to grow your POWER in a Strategic Partnership

What’s the point of managing a Partnership if good management doesn’t produce better results?

The reality of business Partnerships is that while you work together for long-term mutual success, each partner also needs to achieve their short-term business goals. Whether this is possible will be determined by how much power you have in the Partnership.

Power is determined by two components: Inherent Power and Dynamic Influence.

Inherent Power Explained

Every company has a certain power in the marketplace. When two companies partner, one is stronger than the other and nothing can change that reality — that’s Inherent Power. Google is massive. It generates incredible revenue, incredible profits and it completely controls digital advertising in search, video and display formats. If you want to work with them, you have to agree to their terms. That’s power! If a start-up approaches you, they’ll agree with any demands you make of them. Then you have the power!

Think of your key business relationships. Where do you fit on the spectrum below? Do you dictate the terms or do you accept the terms dictated by your partner? Or is the Partnership quite equal — neither party sitting at either end.

In a relationship, each party sits somewhere along the spectrum of either accepting or setting the terms of deals. The goal of Partnership Management is to move your company towards the right end of the spectrum.

Inherent Power establishes the starting point for the power dynamic in the Partnership. From the beginning, your whole company must accept that this imbalance exists. Having a CEO/Manager that expects a minnow (you) to push around a whale (them) leads to frustration, wasted resources and a deterioration in the Partnership (and your relationship with your manager!) As the saying goes:

G-d grant me the serenity to accept the things I cannot change, the courage to change the things I can, and the wisdom to know the difference.
 Reinhold Niebuhr (1892–1971)

Dynamic Influence Explained

While Inherent Power sets the tone for a Partnership, the other component of power is Dynamic Influence. This is the level of influence a partner has cultivated during the Partnership. If the Partnership (and the performance of the Partner Manager) has worked well, you will grow your Dynamic Influence. Beware! You will lose it if you do a bad job.

Inherent Power is stronger than Dynamic Influence so not even the greatest Partnership Manager will convince Google to significantly change their standard contract but if you build Dynamic Influence, you may be able to get them to agree to some changes.

How to Build Dynamic Influence

  1. Develop a Personal Relationship with the people managing the Partnership. Create personal connections — share and learn about each other’s families. Give a personal gift that shows you remembered their hobbies. Extend beyond the strict business boundaries.
  2. Use their World View when speaking with them. (a) Use their terminology, and (b) phrase your requests in terms of their goals (e.g. ‘Agreeing to my request will help spread your brand to Latin America) (c) help them stand out from their competitors (e.g. “This feature is something Siemens could never offer”).
  3. Expand Cooperation by learning your partner’s strategy and how you can help them achieve it. Even if there isn’t significant revenue in it today, just being part of your partner’s future will keep the Partnership relevant and grow your Dynamic Influence. This will also impact decisions concerning your existing business.
  4. Expand your network beyond your primary partner contact. This means growing UP to more senior people at your partner and OUT to people in different parts of the company. Most decisions require multiple decision makers (nod to the lawyers!) so the more people that like you, the easier it will be to have your requests approved.

But be careful, unlike Inherent Power, Dynamic Influence is just that — dynamic. It can be strengthened or weakened based on how well the Partnership progresses. Progress is effected by both the way you manage the Partnership and external factors which are out of your control (e.g. the price of raw materials). That means there’ll be good and bad times so you need to pick the time to grow your Dynamic Influence.

CHALLENGE

Think about your 5 key partnerships:

  • Who has the greater Inherent Power? You or your partner?
  • Have you educated your company to accept the Inherent Power dynamic in your Partnership?
  • Who has worked harder to improve their Dynamic Influence? You or your partner?
  • Which of the above techniques could you use to improve your negotiating position?

To view all blogs in this series, click this link Art of Partnership