Choosing Partnerships Wisely: Three Key Considerations

Hard questions must be asked of business and prospective partners before entering into any multi-sector arrangements, a new white paper suggests – here is what to consider.

The recent White Paper called Sustainability Through Partnerships: A Guide for Executives, explores multi-sector partnerships, where businesses collaborate with government, non-governmental organisations or other community-based groups.

According to the paper, partnerships are increasing because they are effective: they can address problems that individual organisations or even whole sectors can’t solve independently.

They are a natural way to address sustainability issues through their potential to drive innovation, improve society and the environment, increase legitimacy and help stakeholders acquire new skills and resources.

Produced by Pennsylvania State University academics under the guidance of Canadian Not for Profit the Network for Business Sustainability, the research draws on analysis of more than 275 works, identifying best practice for multi-stakeholder partnerships.

It warns that multisector arrangements entered into without due care and consideration are often destined to fail. A two-step process of diligence around the business and the prospective partner should be undertaken to reduce the risk of faIlure.

According to the paper, business should be able to answer the following three questions before commencing any partner selection process:

1. What is the organisation’s goal?

• Reactive partnerships respond to a threat such as community outrage, compliance or a charity.

• Transactional partnerships focus on improve market or profit share.

• Integrative Partnerships try to balance bottom line considerations with social/ecological concerns.

• Transformative partnerships seek wider societal improvement by meeting all partners objectives and empowering communities.

2. What is the size of the problem and the number of possibly relevant partners and sectors?

3. How ready is the organisation for more complex partnerships?

Three key questions should then drive the business’s partnership selection:

1. What makes the partner relevant and logical?

• Appropriateness.

Put the issue, not the organisation at the centre of the selection process and identify who creates or is involved in the issue being tackled – these will be the most appropriate stakeholders to engage.

• Representation.

Prospective partners should represent those affected by the issue being tackled. Sufficient resolution otherwise may not be achieved due to a lack of authority over the issue.

• Different perspectives.

Broaden horizons by talking with a diverse range of prospective partners including those who are initially judged unlikely to be ultimately suitable.

2. What can the partner offer?

• Complementary capabilities.

Measure the resources necessary to meet the partnership’s objective and understand what each partner can bring to the prospective collaboration. Choose partners with complementary resources. Understand the partner’s strengths – some Non Government Organisations may be advocacy based and thus powerful lobbyists, while others may be operational and have expertise delivering social services, for example.

• Credibility.

Mutually strong reputations will strengthen the images of both partners, while a  poorly received partner may threaten the reputation of even those organisations traditionally favourably received.

• Power balance.

Large power imbalances may destabilise the partnership by allowing the strong to manipulate the weak. Equally powerful partners work best though alternatively processes to regulate power distribution in the partnership can be put in place.

3. How does the partner operate and approach issues to be resolved?

• NGO Type.

When working with an NGO, understand their process. Some may employ an activist-style confrontational approach and rally against business, while others will prefer to work collaboratively with business to solve the issue. Partnerships with cooperative NGOs tend to be the most successful partners for collaborative and effective relationships to be established with private sector organisations.

• Cultural fit.

Businesses and NGOs often differ in their missions and accountability systems, and decision-making may happen at different paces. Transnational partnerships may also require consideration of national cultural differences. Cultures do not need to match but vision must be shared and the differences understood.

• Past experiences.

Avoid prospective partners with past grievances, which can erode trust and willingness to partner in future.

• Time.

Clarify timelines and expectations early on in the partnership. Be open to negotiations should adjustments need to be made, for example, due to a shifting financial or political landscape.

Read the full whitepaper here.