Partnership Evaluation Study in Asia
Updated: Oct 19, 2020
When looking for expansion beyond the home grounds, the businesses generally count upon partnerships in the form of joint ventures (JV), strategic partnerships, mergers or temporary alliances. The decision to settle for any one of the options greatly relies on the purpose, local compliance and negotiation terms with the other party.
Two of the greatest principles of negotiation is:
In-depth understanding of the negotiating party.
Taking lead in outlining the terms thereby making it a reference point for further negotiation.
Despite, all the negotiating principles in place, not all partnerships yield desirable fruits. Some become the metaphor for how a partnership shouldn’t be. Before getting into any partnership arrangement, it’s important to understand the prospective partner(s) through an unbiased view, trying to understand various behavioral aspects and some of the typical traits.
According to a study, ~70% of the partnership arrangements fail and the majority of them end with a negative sentiment.
Speaking with partners, before the partnership, and interacting with the same partners post partnerships are two different and non-relatable things.
Partnerships in third world countries must be closely assessed for the legalities and rights of an international player entering the local market through one such (partnership) arrangement.
Failed partnerships result not only in a loss of time and money but also of proprietary information related to products/services.
It’s important to conduct a deep-dive analysis of the prospective partner before tying the knots.
1. Secondary research was done to prepare a list of past and present partnership arrangements of the prospective partner.
2. Primary research, interviewing senior leadership, was done to identify the typical traits of a prospective partner under varied circumstances.
3. Prospective partner was also assessed in terms of general public sentiment, aggressiveness, support, and connection.
4. Special emphasis on failed/completed partnership was made to closely understand the outcome of these partnership arrangements.
5. Perception across various levels and competencies were drawn and plotted to determine the ability-based fit.
6. The failed joint ventures were assessed from financial, IP and legal angles to find commonalities and draw the inference.
7. A deep dive secondary research was performed to understand the role of local government in such partnerships.