Partnering Relationship

Question :

Explain Key characteristics of partnering relationship and Aligning corporate goals for the success of partnering relationships

Answer :

The key characteristics of partnering relationships include mutuality, conflict, power and dependence, intensity and trust. Mutuality characteristics refer to the common grounds of interests that exist between the company and the supplier. This characteristic is useful when the buyer supplier relationship is evaluated to understand how far both buyer and supplier are interested to forego personal interests in order to benefit the common purpose. Partnering relationships do face conflicts and there is a very fine line between the understanding of co-operation based relation and conflict based relation. Cross-cultural conflicts are common for multi-nationals like Colgate-Palmolive. This is an important characteristic which should receive constructive approaches. In a partnering relationship the existence of power does not mean monopoly (Wang, 2004). Here, power refers to the supremacy of one over the other on different levels. In other words, this refers to the better expertise of one party which benefits the other. Intensity of partnering relationships are necessary in the determination of the mutual benefits obtained in the form of resource exchange. It is an evaluation of conflicts and co-operation. Intensity also refers to the levels of interaction and joint problem resolution capacity. This makes the buyer-supplier relationship cross-functional in nature at multiple levels. Trust forms the base for any partnering relationship. Trust refers to the mutual faith that the agreement or the contract would be honoured. It also refers to the faith in the competence of the other party. Lastly, there is trust between buyers and suppliers which is dedicated at maintaining the goodwill of the company through fulfilling expectations and adhering to the terms and conditions. 

Aligning corporate goals for the success of partnering relationship in the company is critical because it helps in developing a shared vision. Of course the expectations between buyers and suppliers vary but it is important to share a common vision to achieve the goal of cost and value advantage. Alignment of corporate goals comes with various critical considerations for the success of such a relationship. In the current context these include the mutual goal that both the parties are willing to achieve, creation of value for the customers as customers are one of the major drivers who act as a common bonding force, and value creation for both the involved parties. It is necessary to note that conflicts may arise in aligning corporate goals because of the difference in interests but it can be solved through the evaluation and modification of the vision. This activity is actually a strategic tool or a combination of tools that help in achieving successful partnering relationships (Colgate-Palmolive Company, 2012). Alignment here also refers to the alignment between corporate and partnership goals. This means the business plan of action should encompass the strategic actions involved in partnering. The key role of alignment here is the integration of actions. Corporate goals also involve value alignment but it doesn’t meant that buyer and supplier should have the same business value. Rather, they should be complementary to each other. 

1 References

Matevž, R. & Brenčič Maja, M., 2013. Buyer-Supplier Relationships and the ResourceAdvantage Perspective: An Illustrative Example. Journal of Competitiveness, 5(1), pp. 16-38.