More on Trust - How do alliance managers build trust?

As I've mentioned on previous blog posts, building trust is critical to forming and maintaining positive alliance relationships. In this post, I'll describe a few techniques I use to build trust with my partner.

Do my homework! 
Before that very first meeting or conference call, I do my homework. I learn everything I can about the partner and think through the partnering possibilities: What are their issues and challenges? What is their company culture? How are they viewed in the market? What are they afraid of? What can we do for them? What can they help us with? What kind of partnering proposition makes sense? 
When I come to that first meeting prepared, the partner trusts that I'm a professional and I'm taking these discussions seriously.

Document goals and objectives
As the discussions progress, I make sure that I get joint agreement on the 3-way value proposition - (what's in it for them? what's in it for my company? what's in it for the customer?)... so that we are all anchored in what we're trying to accomplish. I find this very useful in keeping us on the same page and focused in our discussions. As we go through the contract negotiation process and beyond, I work with the partner on developing the joint business plan, where we document our mutual goals and objectives. Knowing where we're going, and working together to get there, really helps to build trust.

Set expectations early and often
I lay out the internal decision making process for the partner. Here's who we'll have to get involved, here's the business case we'll have to make, here's who has to say yes, etc etc., so that they know the lay of the land and there are no surprises. As Seth Godin, best selling author and marketing guru says, 'Someone needs to say, "here's how we do things around here," and then they they have to tell the truth. '


Get the executive sponsors together
Just as it's important for me to build a good working relationship with my counterpart, I try to find ways to facilitate relationship building between the two executive sponsors (mine and the partner's). It's much easier for sponsors to work together to resolve disputes and work through intractable obstacles to success when they know and trust each other.

Build the governance plan = > communications plan
The scope and complexity of the determines how formal the governance plan needs to be, but at a minimum, I make sure that we set expectations regarding the formal and informal communications plan and that we understand the process for dealing with disputes. Effective communications at all levels are the best tool we have as alliance managers to build and maintain trust.

As an Alliance Manager, I play a key role in building a framework for trust in the alliance relationship!

How do you build trust in an alliance relationship?

I've done a few posts on the topic of trust because it is so critical in cementing a successful partnership. Trust takes time to build, but it can be destroyed in an instant. We all know how powerful trust is, but what can we do as alliance managers to lay a foundation for trust?

Everything we need to know about building trust we learned in kindergarten:

Lying is bad. 
It would seem to go without saying, but being honest with our partners goes a long way in building trust. Sometimes when we have bad news, the tendency we have is to avoid the truth, or worse, shade the truth. The partner wants to focus on the retail sector and your retail sales director wants to work with another partner. Or the partner wants me to kick in $2M to a matching market development fund and my finance guy says we can only do $1M. Or, or or... pick your bad news. I tell the partner the bad news early. I worked with an exec who used to use the phrase "go ugly early" - meaning if you've got bad news, get it out of the way early. Nothing builds trust faster than being honest about bad news.

If you bully people, they won't like you.
Have you ever had to partner with a company that was much larger than yours? Or that had a dominant market position? Did they let you know it? When you throw your weight around without any sensitivity for the needs and concerns of your partner, they'll feel taken advantage of.

Say you're sorry when you make a mistake.
Sometimes despite our best efforts, we make a mistake. We forget to engage a key stakeholder. We neglect to inform the partner about an important change in policy or personnel. Or maybe we didn't actually make a mistake, but our partner feels aggrieved. In either case, a genuine, heartfelt apology will go a long way to restoring or building trust.


Say what you mean and mean what you say.
This is a bit of a corollary to the first rule, but being clear in your communications with the partner is critical. I can recall many a kerfluffle that I unnecessarily caused by being loose with an email or phone conversation.


Some more tactical/practical thoughts on building trust in the next blog post...

Random thought on lucite blocks

If you have to enshrine your company's core values on a lucite block in order to remind your employees of what they are, they can't be all that "core" can they? I'm just sayin'.

A Tale of Two Islands - A Profile in Building Trust

Picking back up the blogging mantle after several weeks enjoy the lazy hazy days of summer.

During my vacation break, I heard a story on the National Public Radio program "This American Life" that really brought home to me the power of trust.

The program contrasted the approaches of two different countries - Jamaica and Barbados - in dealing with similar financial crises. Barbados emerged from their crisis a much stronger nation - median income is currently twice that of Jamaica's, and its literacy rate of 95% is four times better than Jamaica's. By every economic and socioeconomic measure, Barbados is significantly outperforming Jamaica. Why? Primarily, because during a time of crisis, Barbados chose to use trust as the fundamental lynchpin of their economic recovery strategy and in so doing - reinvented their approach to running the country.

Here's what happened. In the early 90's, oil prices skyrocketed and threw the world into a global recession. This created a real foreign currency crisis for Barbados. Essentially they did not have enough foreign currency to pay for imported goods and wound up having to borrow significant money from the IMF. Barbados' leaders "chose trust" and established a partnership between business, workers and the government to build an economic recovery plan based on shared sacrifice.

Business and the unions, previously adversaries, learned to trust each other, and their close collaboration essentially saved the country. Together they did extraordinary things - labor took an 8% across the board pay cut. Business collaborated with labor and government to make sure that layoffs did not affect both breadwinners of the same family. The results of this partnership were astounding - within 5 years, Barbados paid off their loan to the IMF, wages reached pre-crisis levels. And most importantly, the collaboration established between government, business and labor - still endures and forever changed Barbados' governance model.

Jamaica, and it pains me to say this since I am of Jamaican ancestry, had a very different response when faced with the same crisis in the early 70s.  The Jamaican Prime Minister did not build trust between rich and poor, business and labor. He made autocratic decisions and famously said in a speech that if Jamaicans didn't like what he was doing "there were five flights a day leaving for Miami".  As a result, thousands of middle class Jamaicans (including many of my relatives) left the country. This crippled the economy and Jamaica has never fully recovered. In fact,  now 50 cents of every $ the government collects is spent on paying down interest on IMF debts.

Tony Wolcott, Executive Director of the Barbados Employers Confederation, sums up the bottom line: "Trust is the key factor in the whole cohesion of the social partnership we've got here."

Such is the power of not only a partnership mindset, but of building trust. 

More on how to build trust in future blog posts.

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'"!