Even a few years ago, the thought of partnering with the competition was unheard of. But there are many reasons why it makes good business sense to do. Just because you are competing in the same market doesn’t make them the enemy. Sometimes working together can offer benefits you never imagined.
1. Shared Risk
To understand how beneficial partnering with the competition can be, consider the concept of shared risk. Sometimes your company can take on an unimaginable amount of risk when dealing with complex projects, such as filling a massive order. Any number of things can go wrong, but when you engage in partner co-selling, the risk is equally shared with all parties. This is a common practice when working with an ecosystem of competitive partners. Part of an order is filled by one partner while another will fill others. You may be in the exact same business but by sharing the risk between two or more companies, no one partner will lose revenue from a sale or project that is lost midstream.
2. Meeting Customer Requirements
A good example of how partner co-selling works to the advantage of two or more partners, think about the partnership of SAP and Oracle. If a customer wants to use Oracle’s database as the infrastructure but run SAP’s software on top of that foundation, both tech companies benefit. By working together to provide what the customer requires, both come out winners. Even though both Oracle and SAP can offer both the infrastructure and the dashboard software, the end-user, the customer, might want features specific to one technology or the other.
3. Collaboration to Share Strengths
This can be one of the most beneficial aspects of partnering with the competition. Every company has its strengths and weaknesses. No matter what industry you are in, your strengths will almost always vary from the strengths of your nearest competition. By partnering with a company you would otherwise consider as the competition, you can draw on their strengths and they can draw on yours. Whether it’s collaboration on new product development or in marketing, sales, or any other aspect of your business, partnerships can help you build stability.
Some people liken partnering with the competition to the old cliché, getting in bed with the enemy. Actually, they aren’t far off in that assessment. It is much safer to keep your ‘enemies’ close so that everyone comes out a winner. Partnering with the competition is gaining momentum as the years go by and if you want to build strength in your organization, it just makes good business sense to have a partner to lean on as you grow and vice versa. There is no reason you can’t maintain a spirit of competitiveness while learning to work together for the common good. That, in a nutshell, is the benefit of partnering with the competition.
