The company you keep

I was reviewing AdWeek’s list of Top 10 Technology Stories of 2011 today. #4 is titled “A Second Act for Tech Luminaries” with the following summary:

The founders of some big successes in digital media have returned to the world of scrappy startups—but not in the traditional way. Instead, they're launching companies intended to embody the maxim that venture capitalists fund people, not ideas.

The maxim is not particularly insightful. Venture capitalists are like most bankers, and investors; they put their money behind people they trust and respect. I’m willing to bet that in most cases, VCs also like the people - in this case the tech luminaries - behind the ventures they fund.

I suggest this aspect of business relationships is sometimes compromised or ignored particularly by small and medium-sized businesses in favor of associating their corporate brand with a powerful name.

But at what cost? What have you gained if you have to sell your soul or cede some control of your business to keep Goliath happy? How is it a win for your company if you, your employees and/or your customers grit your teeth every time you have to interact with the big name partner? If customers, partners, employees or support personnel are unhappy, and/or you find your stress level at an all-time high, thereby putting your health at serious risk, have you really achieved a positive?

Approach business alliances and relationships in the same manner you approach friendships. Get to know your counterpart and ascertain that they are conducting themselves with openness, honesty and integrity. The most successful business relationships have  similar values and viewpoints and treat each other with respect. Furthermore, working together shouldn’t require a massive shift in processes or the way customers do business with either entity.

Speaking of, let’s not forget the customer voice in this business decision. Find out how they feel about your proposed alliance or partnership. Your customers do notice the company you keep. And if you want to keep their company, you need to be certain they don’t have strong reservations about this new allegiance. After all, any business partnership agreement is about serving the customer better, isn’t it?

Ideally, the sum of the whole truly is greater, strengthens each company and delivers measurable benefits to customers that enhances loyalty and your bottom line. And at the end of each day you will be able to look yourself in the mirror and smile, knowing you haven’t compromised your principles or ideals to grow your business.

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