Competitive pressures often force companies to create new ways to build their brand, connect with customers and attract new employees. By utilizing strategic alliances, companies can enhance their competitiveness in the marketplace and keep pace with technological innovation.

According to studies by Booz, Allen & Hamilton, the number of alliances in the United States has grown by 25 percent each year since 1987.

A strategic alliance is an arrangement between two companies that combine resources to gain additional business. Strategic alliances are formed when one company alone cannot fulfill client expectations given their existing infrastructure or business model. It often involves two companies that pool together expertise and resources to enter new markets, share financial risks and get products and services to market faster.

Small businesses can form a strategic alliance with a key customer, former employer, competitor, nonprofit or trade association. Many small businesses barter goods and services as a strategy to gain experience in new markets such as health care or information technology.

If you decide to pursue a strategic alliance, start slowly so that expectations can be met while business rules are beingdeveloped and implemented. Moving too fast or taking on too many partners can spell trouble for growing companies.

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