Trust me!

I was recently advising an alliance manager who was desparately trying to manage expectations with a new partner in the face of a sales manager who is fond of "gentleman's agreements". The sales manager's logic was that he "trusted" the partner and therefore the parties "didn't need to have anything in writing".

Here's the problem with that logic. Is there a time and a place for "handshake" agreements? Yes. Is that time when you are establishing a partnership with a new partner. Decidedly no.

In these scenarios, I am very wary of parties who do not want to put things in writing, especially when the rationale is essentially "trust me". This is not trust. It's "faux trust" - bet hedging masquerading as trust - and a sign of someone who does not want to commit.

Here's why. In my experience, when you embark upon a collaborative initiative on a handshake, when things go either very well or very badly, people tend to get situational amnesia. When things go badly, people normally start heading for the exits. On their way out the door, sometimes they also try to shift blame for the failure to the other party. When things go swimmingly well, sometimes greed ensues, and one party will seek to cut the other party out of the action. That's why being committed to the venture (you both either sink or swim together) is an important success factor.

My advice to the alliance manager - if the venture is worth the time to do, it's worth the time to document. Depending on the situation you may not need a formal contract, but at a minimum, you should document the expectations, roles and responsibilities of both parties, and most importantly, what happens if expectations are not met. You should also make sure that ALL the stakeholders that are impacted by the joint plan are informed of the plan and expectations and that they sign off on those expectations!

When you take the time to put things in writing you are saying to the partner, I respect your time and investment in this project and I trust that our odds of mutual success will be much better if we have clarity around our joint gameplan and the expectations for execution.

"Bad deals don't last"

Trust has been a big topic in the news lately - Facebook's questionable privacy policies, UK Google Earth gathering personal information from people's computer's via their unprotected wifi networks. (As if me leaving my front door open gives you the right to enter my home and steal my television set! Not.)

It got me thinking about the importance of building and maintaining trust in alliance relationships. Too many organizations don't get it when it comes to the currency of trust.

I recall working for an internet startup where the CTO and founder would brag about "screwing the partner over", as if this was something to brag about! I'd commiserate with our VP of Sales, who was fond of saying "Bad deals, don't last". He was absolutely right. You may be able to get a partner in a tight spot where they feel compelled to accept a deal in the short term that is not in their long term interests. Ultimately, however, I don't care what kind of contract you put in place, if a deal is not good for one partner, they will find a way out. One way or the other. So you may win in the short run, but you will lose in the long run. Not only with this partner, but your reputation in the partner community will suffer - and then good luck finding ANY company that will partner with you!

For more on this topic, check out this white paper by Robert Porter Lynch (Chairman Emeritus of the Association of Strategic Alliance Professionals) and Paul Lawrence (Professor Emeritus of Organization Behavior, Harvard Business School) - Building a System of Trust for Strategic Alliances.

I'll share more thoughts on this topic in a future blog post.

AMFM - Always Maintain Forward Motion

I read an article in the Sunday Parade magazine a few months ago about an entrepreneur who's daily mantra was "AMFM" - Always Maintain Forward Motion. I loved that! That mantra was so applicable to our partner efforts that I adopted it as our divisional slogan for 2010..

We have been implementing formal processes for qualification, development and field execution of partner initiatives for the last 2 years and one thing we've learned is that momentum is your friend. When partner initiatives stagnate, particularly in the qualification phase, it's typically symptomatic of a project that has waning sponsorship or waning enthusiasm (either internally or within the partner organization).

Partner initiatives tend to be like produce, they go bad when they sit around for long periods of time.

So what we encourage the alliance managers to do now is carpe diem! If you've got sponsorship and a well qualified idea, execute quickly. The market moves quickly, and your sponsors and stakeholders might lose interest and get distracted by the next new "shiny thing" if things get stalled and bogged down.

Always Maintain Forward Motion - or as my nephew would say - "Keep it movin'"!