When it comes to building the future of your manufacturing business, do you see your company standing alone? Many manufacturers are teaming up with experts in other industries or areas to reap mutual benefits. But why should you enter into a strategic partnership — and how could you take advantage of another company’s contributions?
Strategic partnerships are agreements between or among companies that aren’t direct competitors. Working with other companies to reduce your own costs — while offering your partners similar benefits — allows you to combine resources for added value. While there are different types of strategic partnerships, some of the most common include marketing, supply chain, integration, technology, and financial. In addition to cost-savings as well as knowledge- and skills-sharing, these can lead to wider product availability, faster delivery, enhanced software functionality, improved technology resources, as well as better focus on accounting and finances, respectively.
Before entering into a partnership, it’s important you focus on gaps in your own business strategically chosen partners could help fill, how your manufacturing plant could benefit financially, and whether your potential partner is a good fit. If you can take care of aspects such as technology, marketing, and your supply chain at a reduced cost in-house, there’s no need to form a partnership and outsource these to another company. But if your software and information technology could use a boost, you may want to find a reputable partner and inquire about an alliance. If these partnerships could bring about tangible benefits, you may consider teaming up and strategizing.
Many business owners consider strategic partnerships because of their combined potential for growth. Once again, this encompasses more than saving money and adding skills to allow for development and market advances. From sharing knowledge and resources that leaders can use to improve employee training and development to obtaining more access to target markets via partnerships, potential benefits are nearly endless.
Pick a partner — carefully
Once you’ve studied your own business to see what you need and decided to enter into a strategic partnership with an outside expert, there’s a lot to consider in your potential partners. To get on the same page, it’s important your partners are willing to meet your expectations in terms of speed and quality while keeping costs in mind — and vice versa. This involves setting clear relationship parameters and goals, including deadlines, roles, agreement terms, and more, all set in stone with a contract. Finally, you’ve got to be able to rely on this partner long-term so the time you spend planning, entering into, and bringing the partnership to fruition isn’t for naught.
While you can’t be everything to everyone, you can team up to make the best of both — or multiple — worlds via strategic partnerships. This is especially important for manufacturers eager to enter into production via the Internet of Things and Industry 4.0 as not all have the tools, skills, or budgets to break through into the next industrial revolution on their own. The bottom line is ensuring your partnerships add real value to your business.