Essential No. 4: Leverage Alliances for Growth

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"Instead of hiring our own sales force, our partners integrate our technology into their own product lines," Zaroor says. The result is hundreds of points of sales that deliver high gross margins. And a recession-proof illustration that filling a gap in your alliance partner's product line can form the basis of a long-lasting Little Brother-Big Brother Alliance's win-win relationship, increasing sales and decreasing the cost of selling and marketing.

Insights

To identify and build long-term partnerships, start by answering these questions:

• While alliances can be tricky to execute because of the asymmetric size between Big Brothers and Little Brothers, how well are you leveraging supply and channel alliances to break into new markets?

• How well are you identifying, forming, and building trust-based alliances to ensure a long-term win-win relationship?

• If you are struggling to find the right partner, are there opportunities to leverage any Marquee Customer relationships to play matchmaker?

Actions
Here are three actions you can apply to create and leverage long-lasting alliance relationships:

1. Consider alliances at both ends—with suppliers as well as channels of distribution

Zaroor's alliances with GE and Lextronix—where the former supplies sensor components and the latter provides development and manufacturing services—is a great example of how you can seek alliances of all kinds to create value for your company. Supply-side alliances let Big Brothers participate in emerging markets while smaller, faster-moving companies can leverage supplier credibility and capacities to secure large customer and market opportunities. To complement supply-side alliances, leverage market-facing alliances to address different market or geographic segments.

2. Align long-term interests

Before proposing an alliance, it is important that you determine the potential for a win-win, long-term relationship. You need to identify both the company and someone within that company to champion the proposed relationship. Zaroor bases many of his alliance agreements on contracts after long-term discussions that establish and align interests.

3. Leverage your Marquee Customers to introduce you to the right partner

Companies often talk about how they struggle to find the right partner or contact within a large company. Yet some have Marquee Customers that are also important customers of potential alliance partners. Ask your best customers for help in connecting with possible alliance partners. Your customers can clearly articulate the win-win-win relationship for all parties.

David G. Thomson is the author of the bestseller Blueprint to a Billion: 7 Essentials to Achieve Exponential Growth as well as a business advisor and keynote speaker. His next books, scheduled for publication in early 2010, are Mastering the 7 Essentials of High Growth Companies and The Next 800 Companies to Lead America's Growth

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