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Digital Technology Partnerships: Addressing Your Competency Niche
Digital Technology Partnerships: Addressing Your Competency Niche

January 16, 2023

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Today’s businesses need to expand their strategic decision of “build or buy” with another dimension of “build or buy or partner”. It is important to understand as to how one partner complements the other that contributes to the business relationship.

A sustainable business partnership is laid down on the foundation of mutual purpose and trust, co-ownership (sharing profits as well as risks), and co-creation of the goals to fulfill the customer requirements and market demands. In the digital tech ecosystem, partnerships play a very important role to enhance the knowledge base and competencies, improve the market share and accelerate growth, co-innovating for solving the customer problems and improving collaboration amongst communities for achieving competitive strategic advantage.

It is very important to identify your digital competency niche so that you can design your digital strategy to accelerate digital transformation and establish new business models and revenue streams. Generally, when an organization encounters a competency niche gap in the cutting-edge digital technology space it opts for strategic alliances with third party vendors offering the expertise in the technology, tools, people, ideas, and frameworks. It is very important to realize that the digital partnerships will be leading to new opportunities and challenges. To capitalize on the new opportunities, it is imperative to build high-performance digital ecosystem supported by long-term sustainable growth.

As per Statista, spending on digital transformation technologies and services worldwide is likely to reach USD 3.4 trillion by 2026 which is close to 84% increase as compared to the spending in the year 2022 (USD 1.85 trillion). [Source: Global digital transformation spending 2026 | Statista] In view of this increased digital spending organizations need to have a sound digital strategy which drives business performance improvement whether through creating new products or reimagining current processes that are more nimble and leaner, leading to improved customer experience (CX), user experience (UX) and employee experience (EX). A sound digital strategy will also help align technology strategy with business strategy which becomes a critical success factor for driving rapid transformation. Finding a transformation partner that delivers an integrated, holistic solution using both technology-enabled and service-based approach as a single pane of glass is also significant.

The businesses need to prioritize and fund their top earning projects through digital partnerships so that they can optimize the operations, scale productivity, improve customer value and build technology solutions that are sustainable. Managing digital technology partnerships also require integrated program management and portfolio management acumen with experienced partnership/alliances teams which can collaborate well with the vendors, clients, and stakeholders before onboarding them.

While evaluating a potential partner on functional, technical, and commercial aspects it is important to analyze the credibility and testimonials through its customer base and how seamless integration it has done in the past with other partners. If it’s a first-time partnership evaluation on either side, things become slightly tricky as there may be unavailability of data and analyst reports. In such cases it is better to do a proof-of-concept and involve your customer before it gets too late to communicate and switch to another partner. Establishing competency is critical area of partnership; but sustaining that partnership is far more critical as it requires deep understanding of the partner ecosystem including its people, process, technology, culture, financial stability, resiliency, and adaptability. There are six key successful rules to partnering that applies to digital technology partnerships as well. [Source: Partnering: The Rules of the Game | Arthur D. Little (adlittle.com)]

  1. Focus on Strategy first - Many organizations have strategic partnerships; but few of them have a partnering strategy which becomes their key differentiator. For instance, an organization may be domain expert in the Order to cash (O2C) operational process and is looking for a strategic partner in O2C automation software that can speed the order-to-cash cycle to facilitate faster turnover of accounts receivable. There could be many customer deals which may require the expertise of both the partners, but the contribution of the partner towards strategic goals and organizational objectives are the key to a healthy and successful partnership.     
  2. Be aware on the value creation - Value creation is of utmost importance to the success of any partnership as it helps in delivering unique offering. For example, an AI based contact center solution provider may add value to the existing Contact Center software by intelligent routing of calls to specific agents based on customer behavior, ultimately leading to improved CX.        
  3. Use a hybrid approach - Structured and dynamic approach helps in implementing a systematic and repetitive approach with required adaptability as partnerships are constantly evolving. It could be a hybrid of top-down and bottom-up model depending on the situation and complexity.
  4. Communicate right and manage knowledge - It is essential that an organization communicates the right intent of partnership according to the audience. Internal communication, communication between partners and external world must be separated out with the clear message as to how the partnership will benefit each one and the organization. Integrated knowledge management with embedded IT strategy and joint roadmap allows faster adoption of technology leading to partnership success.
  5. Establish performance measurement criteria - Performance measurement is fundamental to the success of strategic partnership. The measurement criteria must be in line with the shared goals and joint roadmap created to accomplish the strategic outcome. For example, the strategic outcome to improve Net Promoter score (NPS) by 10% leading to improved customer retention rate.
  6. Adopt Portfolio Management approach - Due to the increased number of alliances the management complexity increases, and it becomes prudent to prioritize the portfolio. The assessment of the existing partnerships based on the future objectives, partnering strategy and defined objectives help in comparing current partnerships along with potential opportunities and gaps.

A digital technology partnership is a segway to accelerate digital transformation taking your business to the next level by extending your reach to new markets. It also allows creating a strong partner network to deliver faster solutions to customers and capture more opportunities to speed up the growth. 

Views expressed in the blog are solely the author’s and may not necessarily be of the organizations with whom he is associated.


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Gaurav Dhooper
Assistant Vice President, PMO

Strategic thinker, seasoned Project/Program management professional, Agile IT Delivery/ PMO Leader, author and a keynote speaker at various global platforms. Areas of interest include Digital Transformation & Strategy, establishing Strategic Partnerships and implementing Agile ways of working. An avid writer and has authored many articles on Digital Transformation, Agile Transformation, Agile Project Management, Scrum, Project Management Offices and Hybrid Project Management. Has been reviewer for PMI’s Standard for Earned Value Management, Standard for Program Management and a book on Agile Contracts. Holds the voluntary positions of President of PMO Global Alliance India Hub and Senior Official of IAPM for Noida. An active volunteer and member of PMI. Works with Genpact as Assistant Vice President, Business Risk Management PMO (Program Management Office).

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