Handshake Strategy: Create Successful Alliances BSC RISEAustin 2012

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©Business Success Center, Austin, TX 2012. All rights reserved.

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Handshake Strategy
Successful
Strategic Alliances

Presenter Jan Triplett, Ph.D.
CEO, Business Success Center
Sales, Marketing & Financial Strategy

#HandshakeDAA
©Business Success Center, Austin, TX 2012. All rights reserved. 2

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Winston Churchill & Helen Keller got
it right.

“If we are together, nothing is
impossible. If we are divided all will
fail.”

“Alone we can do so little; together we
can do so much.”


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Alliance Definition
A formal or informal agreement
between two or more individuals or
entities to achieve a common goal.

They are NOT Free! They have costs and
they must be worth the effort.


+ Success Question #1: 5

What’s your experience with
strategic alliances?
What’s your experience level with strategic alliances?

 Beginner/just getting started/thinking about doing an alliance

 Set up & run at least 1 successful alliance

 Know a lot & looking to refresh my skills & get new info

 Need help

 See no point in them for us

 None of the above


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Kinds of Alliances

 Personal

 Political

 Business

 Combination of all


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What’s a successful alliance?

 Works long enough to accomplish something.

 Does no harm.

 Breaks even in terms of expenses.

 Everyone goes into it with their eyes wide open.


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Success Question #2:What’s your
success with strategic alliances?
 How many Strategic Alliances have you been part of?
None
1-5
More than 5

 What’s your job been in an alliance?
Create it
Work it
Manage it

 Have your alliances been successful?
Yes
No Got Examples?
Don’t know yet
Hard to tell


+ What does a handshake have to do with 9

successful alliances? Everything!

 Has goals
 Requires “partners”
 Has rules which may differ but everyone has to
agree on them for the handshake to be effective
 Shows trust; not given to all
 Requires work to
accomplish those goals


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Today’s Challenge: Find a Potential Ally

Use the Strategic Alliance Survey
to help you find someone you
think you want to work with.


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Alliance Handshake Strategy™

 Select a goal

 Understand the time required

 Choose the right ally or allies

 Choose the right form of alliance

 Expect changes & plan for them

 Set up rules & communicate them

 See the exit


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General Alliance Stats

 Thousands of alliances formed each year

 15% annual growth

 60% fail

 1/3 report alliances are a struggle

 9% build successful alliances

Top successful alliances added $72 Billion over 2 yrs.
Bad alliances cost companies $43 Billion.
(Harvard/Accenture study)


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BSC Alliance Success Stats

 Networking —First job, RISE Austin 2011, Community activist,
Networker’s Guide to Success, Easy to Be Green
 Cooperative competition — Austin Technology Incubator
(contract), Attorney (speaking), Thinking Big, Staying Small (co-
author), Texas Entrepreneur Network First Looks Mentor
 Sales Rep — Virtual Marketing Director
 Co-op marketing for clients and with clients
 Acquisition — Entrepreneurs’ Association
 Trading Company — 2 international trade missions, Japanese
colleague


+ Handshake Strategy Step 1 14

Select a Goal & Envision Success
 ID Objectives & Milestones
 Choose a goal that is:
 Observable
 Measurable
 Verifiable


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What You Can Accomplish with an
Ally
Goals Potential Problems
 More or better sales  Limits to cooperation

 Learning/Skill building  Conflict/disharmony (can be ok)

 Cost reduction  End up weaker than ally

 Risk reduction

 Shared work


Why Businesses Form Alliances

Companies report 18% of revenue is from their alliances.

o Increase profits
+ o Meet threats & improve sales
o Take advantage of opportunities

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Sales Alliance Goals

 Sell existing or new products & services to:
 New customers (for all allies)
 Existing customers (of allies) — Cross Sell Partner


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Marketing Alliance Goals

 Cross or Joint Marketing Alliances
 Keep competitors out
 Share marketing costs
 Share distribution costs


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Marketing Alliance Goals

 Cooperative Marketing
 Traffic & Exposure
 Dollars Back
 Sales Push
 Credibility


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SXSW Alliances Example
Meeting Your Goal

 Before
 Arranging something ahead of time and working it
with your allies
 With exhibitor; with presenter

 During
 Looking for an ally to help you achieve a goal during the event
 At a meeting, workshop, standing in line, event

 After
 Looking for an ally at the event to help you achieve a goal you are
working on or an opportunity
 Observing & talking to colleagues about potential allies


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Operations Alliance Goals
 Operational Alliances
 Design collaboration
 Keep competition out
 Establish standards
 Lobby for regulations
 Lower costs/higher profits
 Provide services for each other
 Employee sharing
 Private Label
 Shared Stock Purchases
 Joint production/teaming, link
operation & purchases, cross training http://www.youtube.com/watch?v=aGurNvxMLPg

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Funding Alliance Goals

 Equity Partner

 Angel Investor NOT A BANK!

 OEM/VAR

 Channel Partner


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ID the Goal of this Alliance
Is there more than one?

http://www.youtube.com/watch?v=ikiJN316kvA


Go Wrong
Between 30-60% of alliances fail.

Timing Bad
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Too weak a “partner”

Priorities not shared

Roles & responsibilities unclear

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Understand Timing; Begin Early
 Decide what time is available to achieve goal
& run the alliance
 Once
 Trial
 Periodic
 ShortTime
 Long Time

 Leave time to create agreements &
train staff & up management system
BE REALISTIC. Double the time you think it will take.


Have Enough Time to Manage the Alliance
Plan it, work it, stay on top of it
Successful Alliances:
Build trust
Leverage Strengths
Minimize Weaknesses
+ Successful Alliances are:
Controllable
Diagnosable/Fixable
Predictable
Replicable
Trainable
Valuable


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Examples of Timing & Agreements

o Non-Disclosure Agreement (NDA)
o Teaming Agreement
o Joint Venture Agreement
o Employee Sharing Agreement
o Stock Purchase Agreement
o Agreement Among Stockholders Agreement
o Subscription Agreement
o Employment Agreement
o User License Agreement (ULA)


Choose a Platinum Profile™ Ally
 Not too big; not too small

 Not too strong; not too weak

 Just right for you


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Selecting Allies

 Two Possibilities
 Choose your allies
 Be chosen to be an ally


Why go to the time & trouble to find the
right allies?
Shorter lifecycles for products and services

Reach the market anytime, anywhere faster &
easier

+ Customers demand more integrated solutions


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Major Risks of Bad Allies
 Technology leaks

 Stealing

 Provides vital info on future plans

 Customers switch to competitor

 Delays decision making

 Asset sales below market value

 Fake alliance

 Alliance “float” — ally fails to deliver


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The Perfect Match

Profile Verify
 Make sure your allies have: Do your due diligence
 Complementary strengths
 Check them out with those
 Limited weaknesses & not
the same as yours you trust
 Find out about their
 Allies should match your experience & attitudes to
preferred profile alliances
 Demographics
 Psychographics
 Risk tolerance
 World view
 Growth approach
 Ethics & culture (game)
 Management & decision
making style

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Types of Allies

Co-opetition*: cooperating with your
competition for mutual gain.

Complementors: companies & products
that boost each other

*Term adopted by Brandenburger & Nalebuff originally from Ray Noorda,
founder of Novell Networking Software


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Co-opetition & Complementor
Examples

Keemah, TX Boat Repair Kappabashi Street, Tokyo


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Complementor Example

http://www.youtube.com/watch?v=yl5jU7srXA4


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Choose a goal and find
a potential ally.



Choose a Win-Win Alliance Form

Choose the right form for your goal

 Informal  P2P or B2B
 Handshake  All are REALLY P2P
 Verbal

 Formal
 Signed mutual agreement of
understanding
 Legal contract

©Business Success Center, Austin, TX 2012. All All rights reserved.
©Business Success Center, Austin, TX 2012.
rights reserved.

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Formal Alliances

 Legally Speaking
 Equity Partner
 Franchise/License
 Merger/Acquisition
 Spider Web/Serial Entrepreneur
 Trading Partner
 Keiretsu/Shudan

 Business Formation
 Partnerships
 Corporations
 Joint Venture
The Handshake Alliance — in TX verbal & handshakes are legal contracts



Plan for Problems & Changes

 Monitor  Validate
 Short Term Milestones  Getting through the differences
 Long Term Milestones  Not giving away too much
 Training & re-training everyone
 Measure in the alliance
 Initial Metrics  Sharing power
 Short Term Metrics  Communication goes both ways
 Long Term Metrics


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Early Warnings of Trouble

 Priorities misplaced — Me first, You last

 Lack of trust

 Missed deadlines

 Roles confused

 Team conflicts

 Win-lose position of ally

 Cost overruns

 Missed goals & milestones Why you need a contingency plan.



Set Rules & Responsibilities
 Authority  Who’s in charge?

 Marketing  Who decides?

 Sales  How it’s done?

 Finance  Who pays & where it stays?

 Assets  Who owns what?

 Personnel  Who works & how long?

©Business Success Center, Austin, TX 2012. All
rights reserved.

Martin Luther King told us…
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“All progress is precarious,
and the solution of one
problem brings us face to
face with another
problem.”

“Change does not roll in on
wheels of inevitability, but
comes through continuous
struggle.”



Plan an Exit
 Know what is “Mission Accomplished”
 Reap the benefits
 Have a way out (transfer, transform, exit)
 Have a contingency plan


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Success Question #3:
Do you have all of these?
Check off what you have in place.
g Profile System to select the right allies & a process
to choose them and be chosen

g Rules & responsibilities set up & working

g Metrics & an Early Warning System

g Contingency Plan (B, C, D)

g Exit Strategy that all agree to

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Next Steps
 Get started on the steps you haven’t completed.

 Test & validate all your Handshake Strategy
steps. Use them.

 Examine critically the strategic alliances you
have in place now. Look for warning signals.
Make changes as necessary.

 Consider Reading:
 Blue Ocean Strategy by Kim & Mauborgne
 Business Alliance Guide by Lynch
 Developing Strategic Alliances by Rigsbee
 Handshake Strategy by Triplett
 Networker’s Guide to Success by Triplett
 Strategic Partnerships by Wallace

Email me (triplett@runitright.biz) your questions or to set a
time to talk. The initial meeting is free.
©Business Success Center, Austin, TXTX 2012. All rights reserved.
©Business Success Center, Austin, 2012. All
rights reserved.

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JFK knew the value of alliances.

“Where nature makes natural
allies of us all, …beneficial
relations are possible even
with those with whom we most
deeply disagree, and this must
someday be the basis of world
peace and world law.”


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Here’s to
your
success!

Jan Triplett
triplett@runitright.biz
Blog: http://www.ownersview.com
512-933-1983

#HandshakeDAA 4
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Handshake Strategy: Create Successful Alliances BSC RISEAustin 2012

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