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Two for Tea? | Extraordinary Business

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Considerations for successful strategic partnerships

imageHave you ever noticed or read about companies such as Google, HP and Facebook and their ability to simply consumer smaller companies, seemingly for their technology or other resources? These acquisitions are often in the millions, if not billions of dollars. Oddly, in some cases, it doesn’t seem as though the parent company is much better off – which, unfortunately, is often the case.

The truth is, just like starting a business, most of the time when two companies merge, under whatever circumstances, neither company is better off as a result. Inc. Magazine reports in an article that a third of Google’s acquisitions have failed. Forbes reports about the failure of HP’s recent acquisition of Autonomy; one would think that a company of this size, achieving its status through acquisitions, would have expertise with the process, as Cisco Systems has demonstrated.

As a business leader, you probably realize that there are two ways to expand your capabilities in the marketplace – grow it at home or go fishing for it. While growing it at home will ensure that the product conforms to the way that your company operates, a company that is already delivering the solution may be appealing because they typically have expertise in delivery and a market that they are selling to.

A strategic partnership – in its true sense – allows your company and your strategic partner to benefit from a shared vision to deliver a product (service) to the marketplace that combines both of your expertise. It would be like a private school working with an internet broadcasting company to offer online home school. Both companies would benefit s a result of the partnership. [···]

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Two for Tea? | Extraordinary Business

image_pdfimage_print

Considerations for successful strategic partnerships

imageHave you ever noticed or read about companies such as Google, HP and Facebook and their ability to simply consumer smaller companies, seemingly for their technology or other resources? These acquisitions are often in the millions, if not billions of dollars. Oddly, in some cases, it doesn’t seem as though the parent company is much better off – which, unfortunately, is often the case.
The truth is, just like starting a business, most of the time when two companies merge, under whatever circumstances, neither company is better off as a result. Inc. Magazine reports in an article that a third of Google’s acquisitions have failed. Forbes reports about the failure of HP’s recent acquisition of Autonomy; one would think that a company of this size, achieving its status through acquisitions, would have expertise with the process, as Cisco Systems has demonstrated.
As a business leader, you probably realize that there are two ways to expand your capabilities in the marketplace – grow it at home or go fishing for it. While growing it at home will ensure that the product conforms to the way that your company operates, a company that is already delivering the solution may be appealing because they typically have expertise in delivery and a market that they are selling to.
A strategic partnership – in its true sense – allows your company and your strategic partner to benefit from a shared vision to deliver a product (service) to the marketplace that combines both of your expertise. It would be like a private school working with an internet broadcasting company to offer online home school. Both companies would benefit s a result of the partnership. [···]

Read More