It is not always easy to form a strategic alliance. When the effort is planned correctly, and each party commits the right leadership levels and resources, then it becomes possible to win projects or bid on contracts that were previously out of reach for each business.
Several significant benefits can develop when forming a strategic alliance, which is why it should always be an idea to consider if the option exists.
1. Easier Territory Entry
When a company can enter into new geographic territories with an experienced partner, then it can take years off of the learning curve. There are also cost benefits to consider with this advantage since it will take fewer resources to develop relationships and complementary work experiences.
2. Additional Competitive Skills
A strategic business alliance can augment your current skill set to create an approach that provides the total package on every project. Your company gains access to new, competitive skills without the cost burden of recruitment and salary.
3. Create More Income
Instead of duplicating resources that already exist in the marketplace, a business alliance keeps all of the assets in the partnership. You can begin the work of improving or expanding what already exists to provide services to consumers and your strategic relationship.
4. Intellectual Capital
Some companies try to develop internal resources that can make them competitive. According to Deltec Bank, “Businesses that look for alliances partner with agencies that have strengths where their weaknesses exist. These partnerships allow you to work smarter instead of harder, which means you’re building high levels of intellectual capital that will pay future dividends.”
5. Industry Stability
Periods of economic growth and recession exist for every industry. If you need to face the ebb-and-flow of this movement alone, then there is a higher risk that the business could become insolvent. The development of strategic business alliances allows everyone to benefit from their collective work experiences. It is even possible to outsource work to each other as a way to manage these cycles.
6. Go Past the Competition
New alliances can become a formidable force that your competitors may fear. Your customers might become curious about the benefits that the companies can provide for them with a new relationship. Even a marketing boost happens when 2+ agencies come together to try something new, which means more chances to develop leads.
7. Improve Existing Resources
A strategic business alliance allows each agency to provide more training and mentoring. There are enough internal resources in most of these relationships where no one needs to hire new consultants or trainers to improve the existing resources. Even if new people must be brought into the corporate family, there will be fewer holes to fill.
Engaging in a strategic alliance makes sense when all of the parties involved can experience tangible benefits from the relationship. If the approach to a partnership is one-sided, then the incentive to partner up disappears. That is why this method of approaching the marketplace requires robust leadership and a commitment to success for it to be useful.
Disclaimer: The author of this text, Robin Trehan, has an Undergraduate degree in economics, Masters in international business and finance and MBA in electronic business. Trehan is Senior VP at Deltec International www.deltecbank.com. The views, thoughts, and opinions expressed in this text are solely the views of the author, and not necessarily reflecting the views of Deltec International Group, its subsidiaries and/or employees.
About Deltec Bank
Headquartered in The Bahamas, Deltec is an independent financial services group that delivers bespoke solutions to meet clients’ unique needs. The Deltec group of companies includes Deltec Bank & Trust Limited, Deltec Fund Services Limited, and Deltec Investment Advisers Limited, Deltec Securities Ltd. and Long Cay Captive Management.