An Unconventional Maturity Model for Growing Strategic Alliances

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For technology companies, the discipline for building and capitalizing on strategic business relationships is critical. Companies do it to create customer experiences that cannot be created alone. They do it to share business leads. They do it to build on each other’s content engines.

There are many reasons for establishing these relationships and very little guidance for how to do it effectively and responsibly.

Well, I’ve got good news for you!

This post will summarize a five levels of maturity for assessing where you are in each of your strategic relationships, based on something we’ve all experienced: growing up. Use this as a basic template for defining your relationships and planning to take them to the next level.

Strategic business relationships can be a little whitewashed in our stone-cold business world. My hope is that this post helps you put a little humanity back into them.

Level 1: Share the Playground

As a child, one of the earlier things you learn to do is be nice at recess. It’s where you learn to make friends and play fairly. And, it’s where relationships begin that could carry on through the rest of your life. It’s also where you’ll meet people that you’ll never see again.

As a technology company, building the foundation for future strategic alliances is no different. You can’t just jump into being best friends with someone. You start by playing nicely on the playground.

Show up. Attend events, Tweet jams, and meetup groups. Be in the community and be visible. But, be visible for the right reasons–because you ask good questions, introduce yourself, and represent your brand well.

Your goal is to touch a lot of other companies–to learn who they are and what they do. And, you want to share who you are too!

Don’t expect anyone to write a check, give you leads, or to make any kind of commitment to you at this point. That’s not what you’re shooting for.

Everything you are doing here is about establishing the foundation for future relationships that will have more strategic importance.

(Side note: Even as you develop deeper relationships with some of these companies, you should never stop doing these activities.)

Level 2: Share the Sandbox

On the playground there will be many kids you never play with. There will be some you’re cordial but at an arm’s length with. Then there will be the ones you start to bond with. You start to make friends. That means you start to work together on some things–building a sandcastle for instance.

In the business of developing strategic partnerships, this is where you start to narrow “all possible relationships” to a funnel of ones that might have legs.

Look for companies that seem to have similar values or a congruent world view. But, also challenge yourself to think outside the box. A new strategic relationship might change your perspective for the better.

Tactically the relationship still may be informal, starting with low risk, low cost ways to work together. Maybe you go out of your way to make mutually helpful introductions. Maybe you guest post on each others’ content platforms. Maybe you collaborate on speaking engagements.

At this point, you’ve not made any significant commitment to one another, but you’re choosing to play in the same places. You’re starting to build bonds, and some of those relationships will grow into more meaningful ones down the road.

Level 3: Share Your Time

As you grow older, into adolescence and early adulthood, you begin to develop a sense of self. And, with that, you begin to develop a discernment for who you spend your time with.

Your “friends” become less an incident of proximity or pre-determined relationship (your parents happen to be friends) and more a decision about who shares your ideas and hobbies.

This is a challenging transition for a person. You go through a long period of finding yourself in the people that you meet and spend time with. Sometimes, you choose the wrong people and the wrong activities, resulting in mistakes and (hopefully) lessons learned.

Businesses must work through this same “know thyself” period and will unpack the same types of problems that the people will.

Occasionally helping each other out and guest blogging for one another is nice…but it’s not going to maximize the value of a strategic relationship by any means. You must consider which of these relationships are ones worth investing time and ultimately risk into.

The phases leading up to this one are important. You must be clear about your goals, your values, and your way of doing things.

If you start to make investments in partners that don’t share or align with what you want to accomplish, you’ll create friction. At best, the relationship will be messy and unproductive. At worst, it’ll be costly and destructive.

Typically you enter this phase in a relationship when you start to share accountability for mutual customer’s success. Maybe it requires dollars into product development or training. These relationships set up a situation where if either party fails to deliver their end of the bargain, both could be risking customers.

But, if the partnership works out well, the customer benefits even more by the value the partnership has created!

As an organization that depends on strategic alliances to meet its goals–that’s just about every organization–this is the phase where you’ll make it or break it. This is the longest and the hardest phase, but it’s arguably the most important.

Level 4: Share Your Bed

As you grow as a person, you eventually start to pick out a small number of relationships with whom you share your bed. With these people, there is a much higher degree of exclusivity and intimacy. There is a closeness that goes beyond that of your buddies.

This analogy might sound somewhere between crass and creepy, but it’s an important point.

The best of your best strategic relationships should blossom into something different (for the better) than what you have with the rest of them. You will open the trade secret kimono. You will work on solving big problems together, without as much fear over being transparent.

The most innovative strategic alliances are of this kind. These are the ones where the psychological and legal safety between two organizations is high enough that people can get real. And, that creates opportunity to solve major problems.

Let me be very blunt about this, though. These are very difficult relationships to build. They take time, effort, strife, and conflict. You don’t just snap your fingers to create a close strategic relationship.

Much like with an individual, if you dive too quickly into what looks like this kind of relationship, there’s a high probability of getting hurt.

You will not have many of these in the life of your company (relatively speaking). Even still, some that you will have will not end in bliss. But, work toward this type of relationship with your best partners. Strive to be the best possible partner.

When you do find this kind of strategic relationship, appreciate it.

For many strategic relationships between companies, this is as far as it goes. That’s not a bad thing by any means. Fully realized, synergistic alliances can generate a lot of value for both parties involved.

But, in a rare set of cases, the relationship goes one step further.

Level 5: Share Your Life

For many people (certainly not everyone), you get to a point where you decide you’ve found “the one”. You begin a life together. You become intertwined legally and otherwise.

In a technology company this is where strategic alliance turns into strategic investment, merger, or acquisition. The relationship legally becomes complete.

The most successful of these relationships are between companies with significant cultural alignment. They may not have exactly the same vision for the future, but their visions are complementary. Their visions complete one another’s.

No M&A relationship is perfect. They are all difficult to execute, because it requires the fusing together of two entities. Both companies fundamentally change and transformation is uncomfortable. Eventually though, the fate of the partnership comes to full maturity and ceases to be a partnership. (You can’t partner with yourself.)

It’s not always a happy ending though. When you marry the wrong person, it usually doesn’t work out. If you marry the wrong company, your fate is likely the same. At best, you’ve got a long, hard road of integration. At worst, pieces are divested.

No strategic relationship is without risk, but for the ones that make this far, the risks are highest. Yet, so is the upside financially. And, the most mature relationships can leave the biggest marks on the world.

Wrapping Up a Weird Analogy

I get it. Comparing the maturity model of strategic alliances for technology companies to the path of human social development is a little funky. I’m guessing I lost some people at the “share your bed” section. But, hear me out…

Building these relationships is really hard. Benefiting from them in the way you intend to from the start is even harder. These are expensive and important endeavors to undertake for almost every technology company.

Companies are investing in people who specialize in building such relationships. They are also investing in software to help make it happen. And, they are certainly spending oodles to be present at trade shows and industry events.

It’s in your best interest to recognize whatever helps you maximize the potential for success.

So, here are your lessons learned for life and strategic alliance development:

  1. Maturity is a process. If you try to advance before you are ready you are likely to stumble. Recognize that growing up takes time, embrace the journey, and stay steadfast in working your relationships through the levels of growth.
  2. Not everyone makes it to the next step. Accept that some strategic relationships will be what they will and never anything more. That’s ok. Move other ones forward.
  3. Recognize where you are with every strategic relationship you develop. Both parties have to move through these levels together.
  4. Every level of relationship is valuable in its own right. Make sure you are providing at least as much value as your partner in each level of the relationship, and make sure that amount of value is appropriate for where you are.
  5. Just like how getting married at 10 years old is a bad idea, advancing too far into a relationship without appropriate organizational maturity is a bad idea. Your company, like a person, has to grow up to be able to participate in a deeper strategic relationship.

I hope this helps you put the human element back into building strategic relationships with other companies. After all, you’re really building relationships with the people at those companies, so you can help one another advance as professionals and as people.

What’s more human than that?

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