Recently a question was posed to me: what’s the most critical element of business partnerships?
It’s not trust. That’s an overly simplistic answer. Is trust important? Sure it is. But it’s not the most critical element of a business partnership.
Look, I trust my local police force but the Dublin PD is not listed on the business partners page of my website. I trust my physician but we’re not jointly marketing our services. “Trust” is the easy answer to give to this question but that’s not particularly insightful.
The most important element of a business partnership is a shared purpose. That purpose is something that aligns all the efforts of each organization. That purpose creates momentum and energy around every undertaking between the parties. Without a shared purpose, your partnership is more like The Odd Couple than it is a joint venture.
So if a shared purpose is the most important element of a business partnership, how do you identify it and harvest it?
A shared purpose is nothing more than both organizations seek to change a specific part of the world in a particular way. The strength of that sharing comes out in the organizations’ complementary skills.
For example, I run a leadership development training firm. We’re dedicated to helping people build skills to be better at their jobs. We do so through in-person training events.
I met with a firm the other day that is also dedicated to improving people’s leadership skills. They do so primarily through coaching. Shared purpose. Looks like it will be a successful venture between our organizations.
Look at some of the airline partnerships out there. Again, they share a purpose of moving people across the country (or even the world). Sure they have to trust one another, but the shared purpose is more important.
Shared purpose isn’t only based on industry or function. It can also be a matter of the objective function of the owners. Imagine two wind and solar power companies. Company A is all about saving the environment and the world one windmill at a time. They take a long-term view of their mission and place it at the top of their list of “important things.” They are on a quest for a greener world.
Company B was founded by some former dot com execs who didn’t bail out before the bubble burst. They watched their millions turn into pennies almost overnight. They’ve noticed alternative energy is a hot sector so they invest the paltry savings they have left into starting a wind and solar company. All they care about is building it large enough and fast enough that they can take it to IPO, flip it, and retire to the Caymans. They’re on a quest to put some green in their bank accounts.
I’m thinking these two organizations don’t have a shared purpose. Any relationship between them will be fraught with conflict. Eventually it would dissolve into bickering over green versus green.
Is trust important? Absolutely. But it’s not as important as a shared purpose. Reevaluate business partnerships you’re involved in. Does your purpose match your business partner’s? Regardless of how much you trust them, if the purpose isn’t there, the partnership won’t work out the way you think it will. You’ll simply be reenacting a scene with Felix and Oscar.
What have you seen make for a successful business partnership?