/ June 16th, 2014
Success isn’t always about being the best. It might just be about getting better at what you do or doing it differently. Stepping outside of your comfort zone and building new skills. Success in sales often requires creativity, dedication, sometimes capital investment and a tremendous amount of work. A different way of thinking about success in sales, sort of a short cut was recently suggested.
In a recent sales training seminar the suggestion was made that we create strategic alliances with other sales people who are in allied but not competitive situations and share opportunities. The trainer said that would help to refocus our efforts on core business activities and markets and let our alliance partner bring new products and processes to our customers as a value add. Shared knowledge of both product lines, what will be involved with executing them and what is expected of each of the alliance partners and what each expects to get from the alliance is key.
It sounds self evident but first you need to do an analysis of what exactly your customer needs and is there any way that you can provide this without a second party. If not, then who would that second party be and what can you do to protect the interests of your customers throughout this arrangement as well as your own interests. You are opening up your account list to someone else. Do you have metrics to make sure that each of you is benefitting from the arrangement? Do you have a way to quantify that each of the partners are lending active support with a plan to roll out your new sharing program, and continue to grow it?
There are always challenges along the way but both parties have to agree in advance as to how they will approach these issues, how to share customer information and , this is paramount , protect customer privacy. You might need to consider before embarking on this road who as a third party you can have as a mediator when disagreements occur. Another point to consider would be do your customer have non disclosure agreements in position? That being the case, how would that effect a potential strategic alliance? Customers interests need to come before yours.
Before you decide to move forward with this idea, unless you are in the “C” Suite, check with your company’s management and make sure that you are all in agreement with this type of sharing. Often processes and CRM data need to be shared for these strategic alliances to succeed and management may not agree to this type of co-selling arrangement. You don’t want to be accused of unlawfully disclosing proprietary information.
/ June 16th, 2014
A customer recently asked if it really matters at all if a printer has an in-house lettershop. Doesn’t a strategic alliance work out as well? The answer may well be, it depends.
The failure rate of the strategic alliance strategy is projected to be as high as 70 percent (Kalmbach and Roussel, 1999) in a management study at Eastern Illinois University.
Building and maintaining strategic alliances and doing so successfully requires resources, managing of infrastructure on both sides, a solid commitments to put each partner in the alliance first on an equal footing as every other internal department of each of the alliance partners. It can be a good way to achieve growth without tremendous capital outlay but it requires a tremendous coordination effort and a clear understanding of both company’s cultures and patience on the part of their customers. There needs to be a willingness to anticipate and address obstacles to the alliances success understanding that a true strategic alliance places unique strains on personnel, workflow and equipment availability. Disputes often arise and there needs to be a fair and equitable mechanism in place to resolve them. Unless both companies have a clear understanding of how each works an alliance based on a just desire to advance business and achieve additional market penetration with a new set of critical competencies most often doesn’t work. Unless the alliance is an unusual one the customer is often stuck in the middle.
With an in-house lettershop, a printing company has the ability to check creative for adherence to postal regulations and create the most cost effective pieces or package in cost size and weight for their customers before it becomes ink on paper. There are personnel on site who have the expertise and processes in place that assure this is being done. It can be done in minutes. With a strategic alliance if this processes is even a part of the services offered the creative needs to leave the building for evaluation and often (though this is a strategic alliance) wait in line behind the lettershop’s own clients for the evaluation to take place. Days can be lost in the process in transit. Once the pieces are printed, the piece or pieces have to be transported to the lettershop’s dock and written up again before it can be entered into the work flow of the lettershop once it leaves the printer. Easily 4-5 days are lost if both these processes are implemented.
The major downfall of most printer-outside lettershop strategic alliances comes when work is abundant for the lettershop. The lettershop’s loyal, long time customers come first. Scheduling for the work from the printer comes second and the customer often has to live with a job that is late.
With the very real potential loss of value added services, for example, in-house expertise in checking postal specifications, helping keep customers postal costs down, time lost due to transit and lack of leverage with the lettershop often resulting with late jobs, I would suggest a careful evaluation of the situation before moving forward placing work with this type of alliance.