President and chief executive officer, Children’s Hospital of Orange County
The right strategic alliance results in a team that’s greater than the sum of its parts. Conversely, a mismatch can be a disaster for both parties.
Successful partnerships can help businesses reach broader markets, better serve customers and explore opportunities for economies of scale, especially when a business inhabits a specialized industry niche.
For example, Children’s Hospital of Orange County has built valuable relationships with UC Irvine Medical Center through a formal affiliation and combined pediatric physician training program, as well as with St. Joseph Hoag Health, a long-time neighbor and new Accountable Care Organization (ACO) partner. We also worked with Mission Hospital in Mission Viejo, Calif., to establish CHOC Children’s at Mission Hospital, a satellite pediatric hospital within its adult hospital that brought our services closer to families in south Orange County.
CHOC Children’s has been extremely fortunate to have such valuable partnerships, but it didn’t come without hard work, strategic thinking and thoughtful consideration. So, what are the signs of a promising alliance? The following three questions can help organizations evaluate potential partners.
1. What can a partner do that you can’t?
A critical evaluation through a strategic planning process, including an internal and external environmental scan, will reveal your customers’ needs, both historically and in the future. Look for partners that can help fill a gap in your services or enhance existing services.
In our case, we look at vertical partnership opportunities: If we don’t provide a particular service in the continuum of pediatric care, we need to align with someone who does. Horizontal partnership opportunities enable us to provide better quality services and lift each other to higher levels of performance.
2. Is your potential partner a good cultural fit for your organization?
If organizations have similar or complementary missions, the partnership will fuse faster and more naturally. Sharing core values can deepen the connection: Defined at the executive level, these values are cascaded throughout the organization through supporting behaviors demonstrated daily. And because these behaviors are rooted in our most deeply held values, they are second nature and cannot be forced or mandated.
Further, better partnerships develop if two organizations’ respective leaders are driven not by ego, but instead by the greater good of their customers, employees and community. As a CEO, I am naturally competitive; but, for me, victory means providing a better place to receive pediatric care, a better place to work, and the ability to contribute to advancing pediatric medicine.
3. How can we further maximize the benefits of a partnership?
Whether newly formed or well established, all partnerships can benefit from tune-ups. Look inside first by asking leaders if we can do a better job maximizing the benefits of the partnership throughout the organization.
Like in any valued relationship, face disagreements honestly and transparently. If the partnership is strategically important enough to maintain despite suboptimal results, you may need to accept it for what it is and explore new partnerships to fill gaps in your business model.