Welcome to 2018. Who’s Your New Partner?
Sometime last year, I came across an executive survey – I think it may have been done by Forbes magazine, but don’t quote me on that – that found that nearly two-thirds of CEOs said that they were likely to form an alliance with a “non-traditional” partner in the next three years. And just this week, I came across a couple of news stories that back up those findings.
The first was a story from the January 11, 2018, Wall Street Journal about two car companies – Toyota and Mazda – announcing plans to “share” a factory in Alabama. The Journal story plays up the angle that foreign companies will soon be building more cars in the U.S. than domestic car makers. But I think the real story here is that two voracious competitors have discovered that they can both be more efficient, productive and profitable by sharing some characteristics – in this case the need for a large factory and a qualified work force – that are essential to their operations.
Does this sound familiar to anyone out there in fraternal land? There are so many common back room functions among fraternal life insurers – functions that each society pays for individually and functions that add costs to everything the organization does – that are screaming for a “shared services” approach. If two for-profit car companies can figure this out, why can’t we?
The second story comes from CNBC and focuses on Kohl’s looking for innovative ways to fill vacant space in its big box stores – and drive more traffic into its aisles – by partnering with grocers and convenience stores. This comes on the heels of Kohl’s new partnership with Amazon that allows folks returning products purchased from Amazon – and trust me, there are oodles of them – to drop them off at a Kohl’s location and store employees (one of whom I’m married to) will handle all the shipping details. The benefit to Kohl’s? That’s right, more warm bodies (armed with “Kohl’s Cash”) in their stores! Non-traditional ideas? You bet. Necessary in the new age of retail? Absolutely.
So, who’s your new partner going to be this year? Another fraternal for “shared space” back room operations? A totally different type of company that can add synergistic value to both your businesses? I got a call from a credit union looking to explore potential partnerships with fraternals in the Midwest just last week. Holler if you want the executive’s name…
May 21, 2018