Successful companies have many common elements -- a well-communicated vision and mission, strong core values, trustworthy leadership, motivated and engaged human resources, good capitalization, and loyal clientele.

Having a solid strategy properly executed is one of the main pillars of success for the long term. But you must know where you are heading and how to get there. This is strategic planning in its simplest terms.

The most common strategies are dedicated to growth and are usually divided into five general areas that include: Organic growth, Mergers and acquisitions, Integration, Diversification, and Specialization.

While these strategies can apply to all businesses, they are more appropriate to large corporations. For SME’s (Small and medium-size firms), strategic partnerships are another tool that can be used to achieve growth without the need for major capital outlays, an army of accountants, and a team of lawyers.

Let me illustrate the concept of strategic partnership with the example of the Pilot Fish. The Pilot fish congregates around sharks and its relationship with sharks can be best described as a strategic partnership. Swimming alongside sharks, the Pilot fish enjoys an ample food supply and 24/7 protection. But the young Pilot fish also operates as a professional hygienist to the shark. It cleans the shark’s teeth! This is a risky proposition to be sure, especially to outsiders who do not know of the close relationship, but both parties’ benefit. The shark gains freedom from parasites and gets clean sharp teeth, while the Pilot fish gains protection from predators and can feast on free meals every day.

The essence of a strategic partnership is when two parties provide each other with exclusive or unique benefits and is not to be confused with the exchange of money, as in a supplier/vendor relationship involving a large client. Please note this important difference: if the partnership is based on money exchange, either parties can change partners easily, but when the partnership is based on exclusive benefits, separation is more difficult, though not impossible.

Throughout my first 22-year career heading four different companies within the D&B Nielsen Group, I used strategic partnerships extensively to achieve excellent growth. I used the same strategy during my second 23-year consulting career on behalf of my clients.

While money should not always be used as the medium of transaction, the benefits provided by each party should be valued monetarily in order to properly quantify those benefits. This allows us to reach a reasonable balance of benefits between the two parties.

Strategic partnerships can be based on product exchange, geographical territories, technological specialization, distribution and marketing, and other benefits. For a strategic partnership to succeed in the long term, there must be harmony between the visions of the two companies and that vision or mission should have no conflicting ambitions. So, there is an element of predicting the future here which is very important. However, strategic decisions are rarely straightforward or simple. Successful strategies depend on making good value judgements which by themselves rely on people’s attitude, experience, assumptions, and even emotions.

Nevertheless, strategic partnerships are worth exploring when you do not have the large resources and reach of large corporations.