Week 4 post by Andrew

This week’s readings on organizational partnerships provoked a lot of thought on how partners are selected and why certain partnerships succeed while other ones fail.

Looking at the framework outlined by Kanter (1994) regarding “eight I’s that create successful We’s” (p. 100), for this week’s application assignment I chose to examine the partnership between All Weather Architectural, a Phoenix-based glass-tempering company and Santelli Tempered Glass, a Pittsburgh-based start-up in the field to form All Weather Pittsburgh in 2006, particularly the partnership between the companies’ two presidents, Lance Porter and Joe Santelli. (In the interest of full disclosure: Joe Santelli is my father and I have served as a communication consultant to his company since it was launched.)

The joint venture known as All Weather Pittsburgh set out to combine Porter and Santelli’s individual excellence. For Porter, this was a groundbreaking method to deliver tempered glass (often known as safety glass) to residential window manufacturers with high quality and timely service due to a heavy emphasis on automation technology, but heretofore only put in place in the western markets of the U.S. For Santelli, the strength was the knowledge of the east coast markets serviceable from Pittsburgh and a career’s worth of experience and contacts gained in the glass industry.

When it came to importance, each shared the same major strategic objectives.

“Our long-term goals were to reproduce success in a new geographic area; being able to produce the amount of profit; do it with the same brand name (All Weather) to spread the company’s reputation nationwide,” Santelli said. (The company has since changed the name to Santelli Tempered Glass.)

Each of Porter and Santelli’s strengths also meant they had strong interdependence, Santelli explained. “What Lance had on the west coast was experience dealing with window companies and long-term success. What I had was my sales ability and network of window companies to explain the sales and service strengths of the venture. Lance had all three qualities we needed in his product up and running out west: price, timeliness of service and quality due to a lack of human error.”

Kanter states that partners “invest in each other…to demonstrate their respective stakes in the relationship and each other” (p. 100). For Porter, this was a $1.5m piece of equipment he was willing to put into the new venture in exchange for a minority partnership, with Santelli willing to invest financially in addition to a commitment to running the operation.

When asked about the exchange of information, Santelli said “this was probably the most important element; [Porter] established how much glass could be tempered in an 8-hour period, the amount of labor needed and the price it could sell for. He came to Pittsburgh to start the process and then we would communicate by e-mail and telephone daily to troubleshoot.”

On the subject of integration, “Partners become both teachers and learners,” says Kanter (1994). In the Porter-Santelli partnership, this integration took place with Porter educating the Pittsburgh staff on the technicalities of the automated tempering process, with Santelli taking the lead on strategizing how to best take advantage of the factory’s location. Within 300 miles of Pittsburgh were 100 million people, a much higher concentration of potential end-users of the company’s glass than in Porter’s western operation.

Santelli and Porter institutionalized their decision-making process in the same way as the investment, with Porter serving as an advisor and Santelli having final authority. As Santelli explained, “He basically would let me make my own mistakes. He was a role model, given his experience, but let me do my own thing given the east coast market. It wound up a fairly even split, between me making mistakes and me being correct.”

The eight I of Kanter’s characteristics, integrity, was the most vital, according to Santelli.

“Trust is really the key to the successful partnership,” he said.

“Honest communication between the partners is as important as anything you do. If you’re not being as successful as you could be, you need to tell them that. If you don’t and the numbers come out a few weeks later, it’s much more difficult to re-establish that trust. Your partner can advise, suggest, or share that experience to help you turn things around.”

References

Kanter, R. (1994) "Collaborative advantage: the art of alliances." Harvard Business Review, pp. 96-111.