Structure – then manage – buy/partner arrangements for successDouglas K. Smith, Quentin Hope, Tim Griggs, Knight-Lenfest Newsroom Initiative,
For any given aspect of necessary* work, the choice to buy differs from the choice to partner. Buying means you decide to have others do the work for you. Partner means you decide to have others do the work with you.
Case Illustration: All four Knight Temple groups chose to work with API Metrics for News over the course of the year. Because API tailors Metrics for News to fit and serve each client, the arrangement is a choice to partner as opposed to buy. In addition, API works hard to share learning across their clients. As a result, API becomes a shared resource – a repository and set of relationships through which a network of partners learn from one another about the most effective data and analytics while each user’s approach gets tailored to their unique context and situation.
You must structure each of these approaches for success. Here’s how:
Service level agreements for choices to buy should include:
- Purpose: Name the purpose(s) and broad objectives for the work the service provider contributes – and why both the service provider and your organization care.
- Results/performance: Name the specific performance results that the service provider commits to deliver.
- Work: Describe the work the service provider agrees to do.
- Handoffs: Identify the handoffs – critical workflow points where the service provider hands off work to your enterprise. Detail and describe the requirements for timeliness as well as understanding – that is, steps necessary to insure your folks understand what they are getting from the service provider and how it fits into any work or effort to follow.
- Information: Describe any information, metrics and data the service provider will share.
- People: Name the people in the service provider who (1) are directly on the line to do the work and deliver the results; and/or, (2) responsible for sharing needed information, metrics and data.
- Monitoring updates: Describe the dates and/or time frames for regular meetings in which the performance of the service provider will be reviewed as well as the scorecard to be used.
- Consequences: Describe the consequences (and how those consequences will be determined) for failure and/or suboptimal performance by the service provider.
- Financial arrangements: Describe any financial arrangements (e.g., the schedule and amounts of any payments to the service provider).
- Signatures: Make sure that the service agreement is signed by the people delivering the work as well as the most senior executives.
Partnering memoranda of understanding (MOU) should include:
- Purpose: Name the purposes and broad objectives that you and the other partnering organizations are committing to achieve together. Describe why it matters to each organization, including each organization’s mission.
- Results/performance: Name the specific performance results that the partnering organizations commit to deliver.
- Enterprise names/term: Make sure each partnering organization is named along with the most senior person involved and describe the term (length) of the agreement.
- Need for collaboration: Describe why it is necessary for the partnering organizations to work together in real time to succeed – and why the purpose and goals are not possible through individual organization effort alone.
- Work: Describe the work each organization will do, including work that will be done collaboratively.
- Information: Describe any information, metrics and data that the partnering organizations agree to share.
- People: Name the specific people in each organization who (1) are directly on the line to do the work and deliver the results; and/or, (2) responsible for sharing needed information, metrics and data.
- Monitoring updates: Describe the dates and/or time frames for regular meetings in which the performance of the collaboration will get reviewed. Identify who will attend, what will be reviewed and discussed and the scorecard to be used.
- Consequences: Describe the consequences (and how those consequences will be determined) for failure and/or suboptimal performance by any of the partnering organizations.
- Partnership termination: Describe in advance the circumstances and criteria under which the partners will discuss and decide to end the partnership entirely.
- Financial arrangements: Describe any financial arrangements among the partnering organizations (and, if relevant, third parties).
- Governance: Describe critical governance** issues and the governance arrangements related to them.
- Signatures: Make sure the partnering memorandum of understanding is signed by the people delivering the work as well as the most senior executives.
You and your colleagues also should use service level agreements or partnering MOUs to capture agreements between or among divisions or companies that are part of the portfolio of your corporation. Recall that, in addition to Dallas Morning News, for example, Belo owns companies that do content marketing, events, social media management, data and analytics, and mixed marketing (e.g. T-shirts, coffee cups and so on). Belo will get better and more mutually beneficial results by requiring these companies to use service level agreements and/or partnering memoranda of understanding depending on whether one company is doing the work for another, or they are partnering together.
* Remember that for any given aspect of work, an additional option is to stop doing it. That is, determine the work is not necessary.
** Governance issues arise when partners must resolve questions that go beyond the nature of the work they are doing together. These include such things as whether or under what circumstances to invite other organizations to join the partnership, how best to utilize any assets owned by the partnership, fundamental shifts in the purpose of the partnership and so forth.