What forces me to stand with a glass of wine in my hand on a Thursday at 1 o´clock in the morning, staring at my computer and interacting with several colleagues from our American partner company?
In times of uncertainty, such as the one we are currently experiencing, sustained growth is essential. Achieving it implies diversifying and taking risks, either in the business model, in the operation, or in any other area of the organization. For smaller economies, international markets are clearly an area to focus on, but size, different culture, or distance are often inhibitors to such a strategy. To circumvent these obstacles, one of the possible options is to grow based on local partnerships, thus avoiding the costs and risks of opening offices in new locations. This is because an adequate partnership allows us to project our presence in the global market.
The process of identifying and selecting potential partners is of paramount importance. At the same time, the focal point should be searching for that which aligns the two organizations. Thus, the following factors should be considered, such as the size, the corporate values, the strategic importance of the business in question in the existing business portfolio, the financial capacity, the management team involvement, the existing technical and commercial skills, the maturity of the market in question, and last but not least, the willingness of top management to grow the business associated with the partnership.
Partnerships should be integrated into the business development plan with an international perspective in mind. They can simply start with employees or presentations by technology partners, but also with connections via LinkedIn. These initial contacts are usually followed by meetings to assess how the organizational culture is aligned and the need to develop a specific business venture or to work together as a way to respond to a commercial opportunity.
Based on our experience, we confirm that this strategy is easier to define on paper than to carry out in reality, especially in markets with different cultures. “Easier said than done!”, of course, as the saying goes.
Here is some practical advice to make partnerships work:
1) Visit your partner. At the beginning of the partnership, both companies should be encouraged to visit each other (within the constraints of the current context, of course) to understand each other’s business culture and leadership styles. Get to know the people you will interact with most. As the partnership grows, encourage people on the different teams to visit each other’s businesses.
2) Be transparent. From the very first interactions, you should be transparent concerning all topics, even the most uncomfortable ones, and there should be no skeletons in the closet. The rates, the exchange rates to be used, the legal aspects, the team composition and seniority levels, and the mandatory insurance required should be openly discussed and agreed upon, even before getting the first project. Try to be flexible in the initial negotiation, but without ever compromising your company’s values.
3) Work as a team. Use the first project to establish a joint work methodology, from the elaboration of the proposal to the implementation itself. Don’t forget that your partner knows the market best, even though they may not be experts in the technology being delivered to the client. Create a culture of cooperation between teams (leveraged on cooperation tools such as MS Teams or Slack), communicate well and regularly, and celebrate together when a project is successfully delivered. Be mindful of time zones and cultural differences. Encourage regular meetings on matters concerning the partnership and hold daily meetings on operational issues.
4) Do what you say. It is important that your local partner has technical knowledge about the service being provided. Knowing the service technically helps to sell it better. In some cases, it is even possible to increase the delivery capacity with your partner’s local resources. In this situation, and in some locations, you can play with the time zone and give the client more than an 8-hour working day by combining your partner’s resources and that of your company. Don’t be afraid to share knowledge.
Going back to the beginning of this article, with the aim of promoting and strengthening team spirit, askblue recently held a wine tasting via video conferencing with its American business partner. Beforehand, each participant had already received the wines at their home. The event was attended by a sommelier and the wine producer’s representative.
The event could not have gone any better and the wines were Portuguese, of course!
askblue’s Head of International Market