Business partnering is the development of successful, long term, strategic relationships between customers and suppliers, based on achieving best practice and sustainable competitive advantage. In the business partner model, HR professionals work closely with business leaders and line managers to achieve shared organisational objectives. In practice, the business partner model can be broadened to include members of any business function, for example, Finance, IT, HR, Legal, External Relations, who act as a connector, linking their function with business units to ensure that the technical, or functional, expertise they have to offer is placed within the real and current concerns of the business to create value.
Mission
The mission of business partnering and the key-aspects of the discipline have been developed recently in the tourism field. The mission of business partnering consists in "creating, organizing, developing and enforcing operative, tactical and strategic partnerships". "Partnering is the process of two or more entities creating synergistic solutions to their challenges."
Examples
Joint selling is an example of operative partnering activity. Account intelligence sharingreselling or "value chain integration" are examples of tactical partnering initiatives. Joint product development is a typical strategic partnering activity. Partnering agreements are commonly used in the different kind of partnerships. One example is the strategic partnering arrangement in the aviation sector which was put together by the UK Ministry of Defence and AgustaWestland. Both partners share an agreed common objective to improve helicopter services and support to the front line. The MOD also wishes to provide the best value for money to the taxpayer while AgustaWestland seeks to provide the best returns to its shareholders via a stable, long-term income stream.
Benefits
Reduction of general costs: business partnering can be cheaper and more flexible than a merger or acquisition, and can be employed when a merger or acquisition is not feasible. Business partnering increases "competitive advantage". The direct benefits of business partnering consist in greater competitive advantage through cooperation and even better opportunities of revenue, occupation and investment in the sector of application. Business partnering creates a no more traditionally-based solidarity or "organic", but a rationale form of "mechanic solidarity". Partnering takes a new approach to achieving business objectives. It replaces the traditional customer-supplier model with a collaborative approach to achieving a shared objective; this may be to build a hospital, improve an existing service contract or launch an entirely new programme of work. Essentially, the Partners work together to achieve an agreed common aim whilst each participant may still retain different reasons for achieving that common aim.
Formation of business partnering
Business partnering can take the form of a strategic alliance, a buyer-supplier relationship, a joint venture, or a consortium. Firms should pay particular attention to the mechanisms of governance used to organize their partnership. They can rely on a combination of contractual and relational mechanisms. Firms usually need to form partnerships with other firms to enable their business model. To become attractive to other businesses firms need to align their internal features, such as management style and products with the market situation. In their 2013 study, Kask and Linton develop two ideal profiles, or also known as configurations or archetypes, for startups commercializing inventions. The Inheritor profile calls for management style that is not too entrepreneurial and the startup should have an incremental invention. This profile is set out to be more successful in a market that has a dominant design. In contrast to this profile is the Originator which has a management style that is highly entrepreneurial and have a radical invention. This profile is set out to be more successful in a market that does not have an dominant design. New startups should align themselves to one of the profiles when commercializing an invention to be able to find and be attractive to a business partner. By finding a business partner a startup will have greater chances to become successful.
Financial business partnering
The term financial business partnering is used to describe finance executives working alongside various business departments including operations, human resources, sales and marketing, among others, providing financial information, tools, analysis and insight, which allows companies to make more informed decisions while driving business strategy. Although finance business partnering has been around for many years, it has taken on increased importance, particularly as the result of the financial crisis of 2007-2008. According to research undertaken by Robert Half UK, 81% of UK companies are looking to form stronger partnerships between the finance department and other parts of the business. Matthew Maloney, the finance director of foreign exchange company Moneycorp, reported that efforts to integrate the finance team more closely into the business have borne fruit.
