Understanding Your Business Relationships

In business one of the most important things you can do is to build and nurture relationships with people that you can help and people who can help you.  The best types of relationships are symbiotic and the worst kinds are parasitic or mutually self-destructive.

For some reason, being able to decipher the nature of a relationship very quickly is a skill that I happen to possess.  I can observe the way people interact with each other and establish in short order what underpins their relationship and whether or not it is healthy for either party.

This really comes in handy at times and has kept me out of more messes than I care to even think about.  Just last week I met with some clients at work, and the two guys were very cordial to each other, but I could sense from the way the body language, how they interacted with each other and with me that something wasn’t right.  I could see they were rivals.  Sure enough, I spoke to the Account Manager working on that client and he described their relationship as a “full on civil war” despite all of their niceties and well-mannered banter.

Having that ability to read those signals quickly allowed me to walk out of the room without having offended either party and remaining as “Switzerland” in their eyes which is what was in my best interest.

While you may never need to be able to read people and situations to that level in your day-to-day business or personal life, you should regularly be evaluating the nature of the relationships you have with other people when it comes to your business.  I would also add that having walked through this exercise with a few coaching students in the past, they always leave the discussion reasonably enlightened and sometimes even troubled by what we work out.

I’m going to share a few insights with you from my business relationship with Udemy and go through the various ways of looking at it.

Our relationship is what I would refer to as loosely symbiotic in nature.  I produce content that they publish in their marketplace non-exclusively and they gently promote it at times to a portion of their customer base that they think might be interested.

It’s really as simple as that.

However, there are some common misconceptions that could arise when you don’t look at it objectively.

You could easily make the case that we have a parasitic relationship and who the parasite is, depends on your point of view.

One could argue that they make nothing and are just a middleman leeching off me, the poor, undervalued content creator.  That ignores the fact that they have built the marketplace, they have a massive audience and they spend a considerable amount of money buying traffic to push at people’s courses.

The other side of that argument is that I’m a parasite syphoning money out of them while they do all the work driving traffic, managing the back-end transactions and providing the infrastructure.  That position ignores the fact that I provide them with the product to sell on terms that they’ve set.

With that, we can safely dismiss the idea that the relationship is parasitic.

Some instructors consider their relationship with Udemy to be a genuine “partnership”.  I don’t subscribe to this idea at all for several reasons.

When I think of partnerships in a business context, I tend to think of companies or people coming together and working towards building something greater than the sum of its parts that bother parties ultimately have a stake in.  There is a clear, mutually beneficial path that each party is committed to taking.

That’s not the situation I have with Udemy.  That’s not either of our faults or to be honest, I don’t even see that as a bad thing.

I have absolutely no stake in Udemy as an entity – they have raised over $100m in venture capital in the last two years and are driving their own agenda to maximise the return on investment for their shareholders.  To be fair, that’s their legal, moral and ethical duty.

As a result of this, they may on occasion take decisions that help them and hurt me – there’s no malice in it, they just make business decisions to achieve their own ends.  And that right there clearly articulates that what we have isn’t a true partnership.

The inverse is true as well.  I have pulled back considerably over the last year on my content creation for Udemy because I couldn’t control what they were going to do with the marketplace.  Some changes they made last June were a big part of the impetus for creating Casual Marketer – I realised that I was dedicating too much energy and effort building their platform and not building one for myself.

Basically, we have a healthy symbiosis.  They offer me a place to share and sell some of my content to a much bigger audience than what I normally have access to.  From their perspective, we’re not exclusive, so if someone else creates better content or converts better, they can promote those people even if it means they promote me less.

Essentially, we work together in a way that suits both mine and Udemy’s best interests.  We have a commission-based sales relationship where they can offer my content to their customers effectively on consignment.  It’s really not very complex.

You need to really think about the type of relationships that you have and are forming with people in your business.  It’s important to take a step back and view those relationships through the lens of the other party and not only through your own eyes.  You want to understand the pros and cons of each relationship you create or are thinking about not just from your perspective but also from theirs.

When you can successfully do that, it makes everything about dealing with that party so much easier.  Having thought through the other party’s position, you often have the ability to position your relationship with them in a way that enhances the value to both of you.

I take the time every few months to do a “relationship audit” and look at my customers, suppliers and people I do business with in general.  I work out where we’re at, what I could do to improve the relationship for both of us and sometimes I even pause to give thought to whether that’s a relationship I want to continue pursuing.

I think if you took the time and did this type of honest review of the people and businesses you work with, you could find yourself having an easier existence while improving your bottom line by being more valuable to your clients, weeding out people that are dragging your down and expanding your efforts with people who make you better.

It’s a great business hygiene strategy and it’s something I highly recommend you try when you have some time.

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