Corporations planet wide are extending their reach through partnerships formed for various reasons. Often they utillize software that crosses company boundaries in an attempt to expedite partnership objectives. However, setting up the networking is extremely expensive and still full of problems that lack simple solutions. Assigning roles, keeping software secure and manageable are actually the least of the corporate world's problems.
Parties often find that in such a volatile business climate, their fates become too intertwined with those of their partners. Thus, as the partnership goes, so goes the business, much like the problems in forming any business partnership.
Corporations also find that because of their partnerships they can lose flexibllity a problem already inherent in being a corporation in the first place. When there seemed like no end to the availability of cash, corporations threw money in an attempt to develope these processes. Then, during hard economic times, the cost of supporting these cumbersome intercorporate processes becomes prohibitive.
For example, when Intel was the only game in town, it made sense to streamline the procurement processes between consistent customers and Intel. However, as other chip makers became more viable to these customers, utilizing each chip makers "system" must have seemed like a nightmare, especially for those locked into partner like or collaborative relationships with only one chip maker.
Another issue to consider is the expensive legal angle. What does a company do when if feels miffed by a partner. Partnerships and collaborative enterprises may seem appealing, but sometimes they are like marriages. How many are going to end in divorce and who will take care of the kids and how will the property be divided?.
The best advice I can give would be to thoroughly examine a partner's past history and current motives. Follow the money. Partnerships like marriages work best when both parties are stable and healthy. Seldom do two sick companies make one healthy company and so on.
A company's focus should always be on its customers and its ability to run a disciplined and honest business with them first prior to adding others to the mix.
Michael P. Murphy 8/6/01
Author - The Greens
Watch for the upcoming novel - The Corporation
Send comments to the author: mmurphy@smallbusinessman.com