Find Your Key Partners
This is an area where a company can map out its network of suppliers and partners. Often, companies with limited resources will look at how they can increase their capabilities from their wider network.
Key areas they would look at is an optimisation of services, a reduction of risk, or perhaps increasing particular skills that they lack.
In particular, you want to look for partners to help you with three key objectives:
Optimising your business model
Reducing the risk in your business model
Gaining access to additional capabilities
1. Optimization
Let's have a closer look at optimization and why companies would want to optimize. McDonald's fast-food chain is a great example of optimization.
McDonald's focuses its business model on its key activity, which is food preparation. It works very closely with its partner network in order to source ingredients. This may include bakeries or bread manufacturing companies, meat production companies, as well as vegetable farms.
Which partners could help you to optimise your business and increase capacity?
2. Risk reduction
Another area where companies would want to work with partners is risk reduction. Often, in the areas of high uncertainty, such as research and development, companies will seek out partners to work with. Examples of this include startups. They can have high uncertainty, and come with huge risks. Startups will team up with accelerators and incubators to reduce risk and to fast-track their route to investment.
Uber has teamed up with Google Maps to access its widely used mapping system. This allowed Uber to focus on its core business in creating the software that made it successful with its initial ride-sharing application.
How could you mitigate your risk? Are there any 3rd party solutions that you could tap into rather than building your own?
3. Filling skill gaps
Some companies, especially in the early stages, will be short in certain capabilities. These might be certain manufacturing skills or research skills. When mobile phone companies first competed with the Apple iPhone, they partnered with Google's Android and other software companies to access software and skills they previously did not have access to. Mobile phone providers and the operating system providers were working together to provide one product for the consumers.
Another great example for tapping into a shortage of skills or capabilities is that in car manufacturing. Often, the final product will have many different partners working together. In the case of luxury car brands, different systems, such as the braking system or computer system, or even the tyres will come from various manufacturers, of all who work together to finish one product.
What companies can you pattern with to help you gain skills leverage or credibility?
KEY TAKEAWAYS!
To get started on your own key partners, have a look at who your current suppliers are and who your current partners are. Next, have a look at what key activities they can perform for you. What are the key resources they have that you may get access to?
If you're just starting out, a good way is to look at your existing model and determine which key activities and key resources you want to focus on and which you can leverage of another company.