Faced with pressure on all fronts to compete in a global economy characterized by lower entry barriers, specialized and fragmented markets, and technological developments, a growing number of companies are pooling resources to bring better products and services to market in a faster, more flexible and more efficient manner.
As defined by Michael Cunningham, author of Partners.Com — How to Profit from the New DNA of Business, these network partnerships enable “a firm’s business model to form a business network of suppliers, buyers, customers, facilitators, trading centers, stores and others, resulting in more effective and efficient delivery of products and services to the market.”
The benefits of partnerships to business performance are well-documented. However, what managers perhaps fail to recognize are the indirect benefits to society as a whole.
Moreover, partnerships among companies capitalizing on each other’s strengths result in better service delivery. This is exemplified by improvements in after-sales support activities through the outsourcing of business process operations (BPOs). This partnership between companies and BPOs has led to far better handling of inquiries and complaints and, therefore, customer satisfaction.
To be noted too is that partnerships result in cost efficiencies due to the pooling of resources among partnering firms to jointly learn new technologies and develop new products, which further leads to lower prices that obviously benefit consumers.
Companies are taking a more active role in the communities where they operate, forging partnerships not only with suppliers, customers and competitors but also with educational institutions, nongovernment organizations, government agencies, religious organizations and other community-based groups to address a wide variety of social and environmental issues.
Companies can reap the benefits from community partnerships. According to the global organization Business for Social Responsibility, “community partnerships are built on shared or complementary strengths of companies and their partners, and can involve one or more of the following activities: information exchanges, research, contributions of company personnel or resources, promotional efforts, and the development or strengthening of community services and capabilities. Benefits to companies include developing trust and goodwill in communities, securing or expanding market position, enhancing brand image, improving risk management, and attracting and retaining employees.”
Kay Calpo Lugtu is the chief operating officer of Hungry Workhorse, a digital and culture transformation firm. Her advocacies include food innovation, nation-building and sustainability. The author can be reached at firstname.lastname@example.org.