One of the most powerful tools for being successful in today’s competitive business atmosphere is forged by teaming up with another person, group of persons, or entity for the purpose of expanding business influence and creating a more powerful market presence. This partnership can happen between goliaths in an industry and can also occur between two small businesses that believe partnering will help them achieve their goals.
Companies with identical products and services can also join forces to penetrate markets they wouldn’t or couldn’t consider without investing tremendous resources. Furthermore, due to local regulations, some markets can only be penetrated via joint venturing with a local business. In some cases, large companies can decide to form a joint venture with a smaller business in order to quickly acquire critical intellectual property, technology, or resources otherwise hard to obtain, even with plenty of cash at their disposal. Venturing allows us to break down traditional barriers and consider concepts no matter how far in advance of current trends and perceived practicalities.
How Does Venturing Work?
The critical aspect of venturing is not in the process itself but in its execution. We all know it is necessary to join forces, but actually doing it can be quite challenging. To be a successful venturer you have to be an informed entrepreneur.
Factors for Success
While there are never any rigid rules for a success, there are a few elements which are critical to a successful outcome:
Plan & Execute: Ventures, both large and small, need to be planned in detail and executed following that road map in order to assure a successful outcome. The details must be contained in a written agreement that carefully lists the objective of the venture and which party brings which assets, both tangible and intangible, to the venture.
Human Factor: The key determining element is the human factor. Human resource integration and knowledge sharing, rather than geographical or financial factors is paramount for success. Both sides must always understand how much they have to gain from the venture and more importantly, how much they can lose by not participating.
Information Sharing: Information sharing is vital. It is essential that the parties talk and exchange their knowledge. This entails meetings, steering committees, joint company events, employee swaps & interactive problem solving.