In ‘As You Like It’, William Shakespeare described the world as a stage, upon which we as actors, will change the parts we play. In the world of marketing relationships its important to know who you are, the role you play – and where others fit into your world. There are different dynamics at play in different levels of business relationships –
A Transactional Relationship, is relatively simple, often easy to replace (if it stalls) and the conversation is based on unit costs and delivery, with the talk based around standard offers, rate cards, scopes and specifications. A Managed Relationship – requires a boutique service, a tailored offer, specialist reporting or pricing.
It is complex – but at its heart, it is still a vendor-purchaser transaction with the invoicing going one way. A Partnership – requires both parties to have a shared understanding, to collaborate and build a joint plan, understanding what value the other party is seeking. It may involve cash. It may not – as cash is not the only currency. It will more than likely require both parties to change what they do as ‘business as usual’. A partnership requires more communication, more conversation time – and its movement forward is oiled by a lot of trust. How do you know when you need to treat a relationship as a partner?
The simple test is that if its difficult, expensive if not impossible to replace – then you’d be a fool not to treat such a high value relationship as a partnership. You need to nurture it; be it a critical supplier, a valuable customer or a hard to get content provider.
This was reinforced to me recently in this great piece by Seth Godin – Talent and Vendors. Godin points out the essential distinction between managing talent, which does not have a set product to sell, and trading with a vendor. He says; “While the talent is also getting paid (to be in your movie, to do consulting, to coach you), she is not a vendor. She’s not playing by the same rules and is not motivated in the same way. A key element of the distinction is that in addition to the varying output potential, vendors are easier to replace than talent is.”
It’s difficult to replace special talent. And its difficult to replace highly valuable partners. In fact, as every partnership and relationship manager knows, they are a lot easier to lose than to obtain and the contract agreement is the start of the work, not the end of it. A valuable partnership needs a lot of resources and the aim is to build mutual value and trust.
On this point, Jamie Billingham also recently published an interesting graphic explaining how an increase in TRUST (that mysterious and highly valuable element of business relationships) – takes a connection to become a collaboration, through an increase in shared risk and reciprocity. It’s a smart and simple way to think about it.
At Benchstone, we often discuss how the three key Partnership Gears – Fit, Planning and Momentum – are ‘oiled’ by Trust, created with a high level of communication and getting the simple ‘little steps’ in place. Without an ability to build trust, the relationship either stalls, goes backwards and ultimately fails. Or – it can be retrieved and revert to a transactional relationship. In many cases, a transactional and highly functional relationship is all that is required.
But – if you are seeking to build smarter collaborations, product innovations and dynamic fresh ideas – then richer relationships are required. And the part you play in creating a culture of mutual trust will ultimately decide what the outcome of the final Act will be…