PARTNER WITH EXTERNAL ORGANIZATION A REQUIREMENTS CHECKLIST
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1 PARTNER WITH EXTERNAL ORGANIZATION A REQUIREMENTS CHECKLIST FEATURE OVERVIEW When two or more organizations work together as separate business entities and benefit jointly based on the success of their endeavor, they are working in partnership. For example, an author writes a book and a publisher publishes it. Both the author and the publisher profit from the sales of the book. This feature covers the business process and software requirements that should be considered by both organizations as a result of a partnership opportunity. This feature does NOT cover the scenario where one organization pays another organization for a product or service those transactions are covered under Purchase Product or Service, Fulfill Order, and Process Payment. This document also does not cover the legal implications of entering into a business partnership. Both organizations should seek legal counsel in defining and maintaining an agreement. COMMON APPLICATIONS Authors and Publishers An author creates a book; the publisher publishes the book. Both profit based on sales of the published book. Often the author receives an advance payment on royalties and then a percentage of ongoing royalties. Affiliates and Providers An affiliate hosts a website with links to products provided by other providers. These links contain tracking codes and if a sale is made after a particular buyer clicks on the link, the affiliate profits, often receiving a percentage of the total revenue. Page 1 of 6
2 Credit Card Company and Provider A Credit Card Company authorizes credit card transactions for an organization. The Credit Card Company typically receives a flat monthly fee and a percentage of each transaction. Corporate Partners for Non-Profit Organizations A Corporate Organization partners with a Non-Profit Organization to raise funds for the Non-Profit in return for the positive brand implications of being socially responsible. BUSINESS BENEFITS Increase in Value Two organizations partnering together can often offer a product or service that is superior to what either could accomplish individually. Increased Revenue Two organizations partnering together can often increase revenue by reaching new distribution channels. Brand Awareness One Partnering Organization can often increase its brand awareness by partnering with a more well-known or well-liked brand. Minimize Upfront Costs By partnering under a revenue-share agreement, an organization can often provide a product or service they would not be able to afford to pay for up front or create on their own. KEY CONCEPTS Term Partnering Organization Buyer Product Service Revenue Offer Definition An organization that enters into a formal business relationship with another organization to accomplish an objective. An individual or organization that provides monetary compensation in exchange for a product or service. A buyer is commonly referred to as a customer. A tangible item that can be purchased from an organization by a Customer. A product could be digital or physical. The provision of a helpful activity that can be purchased from an organization by a Buyer, often involving human effort. A service is an intangible commodity. Income received by an organization. A Product or Service that is provided for Purchase by a Buyer under specific terms. Page 2 of 6
3 REQUIREMENTS QUESTIONS What Product or Service Will Be Offered? What is the product or service that the two Partnering Organizations are collaborating to offer? See Purchase Product or Service. If this is an existing product or service, what changes are needed for it to be offered under the terms of the partnership? If this is a new product or service, what is the scope of creating it? Who will the product or service be marketed to? Who is the potential buyer? What brand will the product or service be marketed under? Here are some common options: o White-Label The Product or Service created by one Partnering Organization is offered and branded by the other Partnering Organization. o Co-Branded The Product or Service is offered under a combination of brands from both Partnering Organizations. o New Brand A new brand is created specifically for this Product or Service. Does the partnership impact any existing business activities or relationships? (For example, would any existing customers be transitioned to be served under the partnership?) If so, what is the impact to those activities and relationships? How will they be transitioned? What Are the Financial Implications of the Partnership? What costs to develop the Product or Service will be shared between the Partnering Organizations? What costs to develop the Product or Service will be covered by one Partnering Organization? How will revenue be shared between the Partnering Organizations? (The most common scenario is to split overall revenue according to a pre-defined percentage.) Page 3 of 6
4 What costs to fulfill the Product or Service will be shared between the Partnering Organizations or deducted from the revenue shared? (For example, before an author receives a royalty, the publisher typically deducts publication and printing expenses.) See Fulfill Order. How Will Activities Be Shared Between Partners? What Partnering Organization is responsible for each of the following activities? (Note: It s possible that the Partnering Organizations will share aspects of the activity.) o Marketing the Offer o Selling the Offer o Fulfilling the Offer o Collecting Payment o Supporting Customers Each of these activities has its own checklist. Use those checklists to identify the specifics of the service and supporting software requirements. For each activity, also consider: Will the activity be assigned to a new department or an existing department? Who within the Partnering Organization is responsible for the activity? What additional staff is needed to handle the activity? See Manage Workflow. What additional resources are needed to handle the activity? See Manage Resources. What tools will people performing the activity need to do their jobs? Does this involve access to tools supported by one Partnering Organization by employees of the other Partnering Organization? See Manage Users and Permissions. Do new or updated versions of any tools need to be created? What information will people performing the activity need to do their jobs? Does this involve shared access to reports or other sources of information between Partnering Organizations? Common examples include: o Sales Transactions Page 4 of 6
5 o Leads o Customers o Customer Service Inquiries See Create Report. Analysis Tip Each Partnering Organization should complete an impact assessment to identify the departments, systems, and processes impacted by the implementation of the partnership. The impact assessment is equivalent to an internal scope document that identifies the scope of implementing the partnership internal to the organization. What Communication Plans Need to Be In Place? What types of communication will happen between the Partnering Organizations during the formation of the partnership? Consider the following aspects of the project: o Initial Agreement o Project Kick-Off/Initiation o Project Development o Project Release o Project Go-Live Once the project is complete, what type of ongoing communication will happen between the Partnering Organizations? Consider the following options: o Sales Reports o New Customers o Traffic (website, storefront, etc.) o Outages. See Respond to Disruptions in Service. Page 5 of 6
6 What types of issues need to be escalated beyond those supporting the product or service day to day? What is the escalation path? What type of communication will happen internal to each Partnering Organization? Consider the following options: o Partnership Announcement o Impact Assessment o Process Change Announcements o System Change Announcements o Go-Live Announcement Who needs to receive communication within the Partnering Organization? Consider the following options: o Board of Directors o Executive Management o All Managers o All Staff o Individual Departments How will each Partnering Organization communicate about the partnership with external organizations? Consider the following options: o Partnership Announcement (often through a press release) o Website Updates o Blast o Phone Campaign See Market an Offer and Communicate with Contacts. THE MOST IMPORTANT THING Partnerships are about creating something that neither Partnering Organization could do independently. As conflicts about specific requirements and processes come up (which they will), encourage everyone to focus on the business objectives and the value you are creating together. Copyright 2013 Clear Spring Business Analysis, LLC All Rights Reserved. Page 6 of 6
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