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June 27 ,2014 | by Sarah Parkin

Relationships between businesses key to success, says report

Relationships between businesses key to success

Businesses need to form relationships effectively if they are to succeed, according to a new report.

Strong links between organisations have often been seen as an important element of successful partnerships. But according to a new report, effective relationships between individuals within companies are a vital element of success in modern business.

The Tomorrow’s Relationships report has been compiled by business thinktank Tomorrow’s Company in partnership with KPMG, Linklaters, the Chartered Institute of Management Accountants and Chartered Institute of Professional Development (CIPD).

 

The report finds that companies frequently talk about people being their most important asset, but that behaviour does not always match up to these claims.

But businesses that want to succeed both in the short and long term will need to make sure their actions relate to their words, the report finds. Authenticity, engagement and trust are all vital elements of the relationships that can make this possible.

That’s especially true given that so much responsibility for these relationships is placed on employees – after all, it is not organisations that form relationships, but the people within them.

“Business success now demands a ‘relational approach’ – stakeholder management and engagement have got us so far but are no longer fit for purpose,” says Tony Manwaring, chief executive of Tomorrow’s Company.

“A relationship with another person cannot be a means to an end and a stakeholder cannot simply be an object. We need to go beyond treating people as things and numbers because the critical challenge we now face is how we create value together.”

 

The report identifies four main aspects of relationship-building, including identifying the most important relationships, “tuning in” and investing in them, measuring the effectiveness of those bonds and then reporting on them.

That may sound like a fairly detached way of thinking about relationships, but CIPD deputy chief executive Susannah Clements says that looking at relationships “systematically” helps to create value in a sustainable way.

Even so, the report says that analysis isn’t everything – relationships need to be dealt with by intuition as much as analysis if they are to succeed. Though that may be awkward for some, the positive effects can be huge.

Sarah Parkin

Sarah Parkin used to work as News Writer for LSBF.  Sarah is specialised in finance, technology and business news.

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