It is the start of the New Year, and our thoughts turn from holiday cheer to the challenges of managing and growing our businesses in the months ahead. As you set your business goals for 2005, give special attention to the web of relationships that help define the world you work in. While the specific players may change from industry to industry, there are many common categories – for example, suppliers, customers, consultants, government agencies, even competitors. Building strong, mutually beneficial relationships can make the difference in the success of your enterprise.

My breakthrough in understanding the importance of managing business relationships effectively came about 20 years ago, and I have been applying a 10-step approach in all my relationships since then. Early in my career, I was in charge of a complex, high-stakes project to set up, for the first time, bank accounts and cash management programs for a large local government. About $1 billion in funds were involved. The legislature had set a tight deadline for opening the first bank account, and there was a great deal of work to do and numerous approvals to get in the relatively short time allowed. The final step in the process was getting contract approval from the government purchasing department. At that time, it took an average of 50 days or so to get a contract approved. I knew I had to do much better than that if I was going to meet the target date.

I developed a strategy to get through the contracting bottleneck in record time. And it worked! The contract was approved in 2 days, just in time to meet the deadline. The critical factor was the relationship I nurtured with the contracting officer in charge of the program. At the start of the project, I briefed her thoroughly on what we were trying to accomplish and its importance to the government officials. I continued to brief her at each key milestone so that when we had the first bank contract ready for review and approval, she knew what to expect and was able to act quickly. By carefully building a solid, mutually respectful relationship, I transformed a potential obstacle into a real partner who shared the same goals.

It is a lesson that I have kept in mind throughout my career, which has included positions with financial services, high tech, and health care companies, as well as government. The general rules apply in every business sector and for overall business relationships, as well as for specific projects. Here are 10 steps to follow in building better relationships to support your business goals in 2005. Good luck and Happy New Year!

1. See opportunities – not obstacles: Too often, when we think about the individuals and organizations we must deal with, we perceive them as barriers or distractions to getting our job done. We have to take time to get a license or certification from a government agency. Or we have to negotiate a detailed contract with a supplier. We must keep Board members in the loop and respond to their questions. Banks and other sources of capital demand more and more information. The first step in building better relationships is changing our mindset to see these entities as potential partners that can help us achieve our business goals. Begin this process with the same positive, confident attitude you use in developing your business plan and running your core business operations.
2. Identify all potential partners: Be specific, starting with general categories (e.g., customers, suppliers, banks/lenders, board members, government agencies). Then identify specific entities and individuals within each category. Be as inclusive as possible. You will set priorities later in the process.
3. Define the impact of each relationship:How does each relationship affect your ability to achieve your business goals? Remember to think in terms of opportunities and partnerships. Competitors can band together to increase the visibility of the entire sector and to lobby for beneficial government action. Suppliers may help you streamline business processes and cut costs. Board members are sources of referrals to potential clients and sound business advice.
4. Set priorities: Of course, you can’t tackle all the relationships at once. You have a business to run. What are the most important relationships in terms of your business success? Be tough-minded. The most crucial relationship may be one that is not positive now, and we all tend to avoid difficult situations. Transforming that relationship may bring the greatest rewards, however.
5. Find common ground: As you begin the relationship building exercise, try to identify what you have in common with the individual you are approaching. Shared interests and shared goals are the foundation of productive partnerships. You can go outside the business relationship to explore common interests, such as hobbies or cultural pursuits. Exercise caution, however. You don’t want to bring up a potentially divisive topic.
6. Think about what you bring to the relationship: It is not all about your needs. Identify what you can bring to the table. How can you help your potential partner in a way that serves both your needs? It may be providing an introduction to someone in your network. Or offering advice in an area where you have the greater expertise.
7. Identify measurable results: How will you know when the relationship has been improved? What are the indicators? By being specific about what you want to achieve, you will better focus your energies.
8. Tailor relationship strategies: Every stakeholder, resource, and potential partner is different. Going out to a friendly lunch will not work in all cases. Your first step may be to meet with your potential partner to get a better idea of her perception of the relationship. What are her business goals? How does she think you can work together more effectively?
9. Develop specific action plans: Develop a specific game plan for each high-priority relationship to begin the process. Identify 3 or 4 concrete steps you can take to implement your strategy. In many cases, better communication will be part of the action plan. That can be achieved through regular face-to-face meetings, email updates, or other ways of sharing information.
10. Set timelines: Develop a disciplined approach, with clear timelines, for carrying out your action plans. Remember your priorities. It is better to improve even one critical relationship in a short period of time than to get bogged down in multiple efforts that you don’t fully act on. Be realistic about what you can accomplish and stick to your plan.