What factors should an organization take into consideration, when choosing a business partner?
Companies have a wide range of criteria to consider when tasked with the difficult objective of choosing a business partner (provider). Here are some of the top things to keep in mind when evaluating a potential new relationship:
Experience: How much experience does the partner have in the specific task? Is the task the partner’s core business or a new initiative? ideally, the partner should be dedicated to that task and have multiple years experience, if the industry has existed as such. A new initiative likely means that the partner is working through a learning curve and making adjustments to effectively operate the service or product.
Management and Operations team: Who are the managers and who are the daily worker bees operating the partnership? Ideally, both are known and offer the same level of experience and knowledge, so that there is no drop off once the contract is signed and delegated to the staff for implementation.
Infrastructure: Ask probing questions about the partner’s infrastructure, specifically seeing/demo'ing software, tools, platforms, processes and procedures so that there are no surprises when it comes time to implement and operate.
Match expectations with compensation: We all want our partners to have the latest and greatest tools and expect them to operate at world-class service levels. Too often, however, we see that buyers that want their partners to have all the latest and greatest tools but don’t truly require any of these, nor are they willing to pay for them, nor does their opportunity offer compensation to be able to support the cost structure to operate these. Think: apples to apples in matching requirements with opportunity; both the buyer and the partner need to benefit and feed their families.
Costs: There are times when to apply pressure on a vendor. Understanding that when a vendor reduces its pricing, typically something else is sacrificed. A good partner is skilled at asking the partner what will be sacrificed and understanding the impact the reduction in pricing has on the partner’s operations.