Relationship Management and Organization’s Business Strategy

Organizations are today faced with many challenges in the economy as well as in the markets due to which they are constantly reviewing and building new business models. Having one product or solution is not enough. Similarly selling through traditional channels is not enough. Surviving in a high tech global scenario calls for innovation in thinking on daily basis.

Take the case of any electronic or high tech business; you will see that the products are not sold in isolation. Company’s do not sell products but sell solutions. When you buy a laptop you will notice the different alliance partner’s logos and stickers that have formed a network to market this product to you. Take the case of IBM, all of its businesses across the globe as well as customers and suppliers consist of strategic alliances with other business partners. IBM has managed to tie up with Toshiba for manufacturing and procurement of colour screens, with Intel for development of chips as well as with Apple in similar joint development partnership. On the sales front, IBM has hived off its laptop business to Lenovo a Chinese Company but continues to sell Lenovo under its product umbrella. IBM has strategic tie ups with Mitsubishi for selling its mainframe computers in Japan. On the Supply chain front too, IBM has hived off its global logistics and Parts service division to Geodis a logistic service provider Company. A look at any of the IBM products will give you an idea of the number of strategic alliances and partnerships that IBM has.

What is it that makes IBM so successful in the current business scenario ? At an Organizational strategic level you can clearly see that they have mastered the art of building successful relationships and networks on all fronts. They have been able to create a Win Win situation for all and thereby managed to reinvent themselves. IBM is in the market bringing the best of the products to the customer today and is also engaging the customer into a relationship while they focus on building products for the future. The single most important link in IBM’s business with its strategic partners, suppliers as well as the customers happens to be their understanding and application of relationship management strategies.

Any organisation investing on technology is investing huge amounts in buying technology and products. In case of business organisations where high end performance computers are very critical for its operations like in the case of Banks etc, they are taking a huge risk of depending upon the vendor. IBM having understood the challenges has built its relationships in such a way with the customers that the customer begins to acknowledge IBM not as a superior product and technology seller but as a Partner in his business and one who is a dependable partner.

Business alliances, strategic partnerships or in other words committed relationships and management with customers, competitors, suppliers, distributors and service providers have become the order of the day especially in case of Multi National companies and more so in the technology companies. Be it the manufacturing of cameras, lenses or high end medical equipments you can see a host of networks and business partnerships behind the products and services. Similarly companies have begun to collaborate and combine their supply chains on international basis with other business organisations thereby it gives them the opportunity to share resources and gain economies of scale.

In case of IBM’s business portfolio we see the Organizational strategy at work in expanding its products and services as well as the customer base, a strategy that is built on Relationship Management with strategic partnership. When it comes to the supply chain too one can see the strategy of engaging into a relationship with a Logistics partner on a Win Win mode thereby releasing its management resources, focus as well as investments from this area and investing it into other useful areas where the company wishes to focus upon. Investing into Relationship Marketing pays.


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