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You know relationships are important. You spend a lot of time and resources making sure that you’ve got a handle on your relationships with customers, prospects, and others outside your company.
But how well are you managing your internal relationships?
The significance of internal relationship management
The core of any business is a collection of internal and external relationships, and the success of an organization is directly linked to its capacity to understand and optimize both of these types of relationships.
In other words, the more connected you are, the more successful you are.
But most people seem to think only about external relationships, such as relationships with customers, partners, suppliers, media and more. And these are important to achieving business success.
However, this is only half of the picture.
Optimizing internal relationships is just as important as nurturing the external ones. Truly effective collaboration within your company strengthens external relationships, leading to greater business success.
Below, we explore how important internal relationships really are, and four big ways you can get to work analyzing and optimizing them—to the benefit of the entire company: establish your network, communicate well, collaborate, and foster a diverse and inclusive workplace.
- Establish your network, the smart way
- Have amazing vertical and horizontal communication
- Collaborate internally, to drive value externally
- Fostering a diverse and inclusive workforce
1. Establish your network, the smart way
New hires at any organization need to effectively establish their network from the get-go. Setting up your network early on is critical to success.
Building a successful network isn’t just about meeting people; it’s about connecting with the right individuals who can help you reach your goals and grow professionally. Actively seek out and engage with key players in the organization who can offer valuable insights, support, and opportunities.
Don’t wait for connections to happen on their own. Take the initiative to identify people whose work matches your interests and goals, and reach out to them. This proactive networking helps you create a strong support system and access important resources to thrive in your role.
Making the right connections gives you a solid foundation to build on as you grow with the company.
Example: the big-time failure rate of mergers and acquisitions
As has been widely reported, a staggering 70% to 90% of mergers and acquisitions (M&A) fail. Why is this? One of the top reasons, as reported by Forbes, is an absence of a people “inventory.”
According to the article: “Most data about people in the organization being acquired is a gut call based on meetings and interviews. These gut calls are always useful but never enough when it comes to fully understanding the valuable asset of people.”
On top of that, formal organization charts often bear little resemblance to the web of people who actually execute work. In every organization, people build informal “go-to” teams. They rely on that one person who always knows “how we do things here.” They find someone in finance who can answer any budget question. These spontaneous, critically important connections are the lifeblood of organizations worldwide.
Internal relationship management would no doubt be a game-changer for M&A, and can offer valuable insights during organizational design, making it easier to establish future structures that position employees where they can deliver the most impact.
2. Have amazing vertical and horizontal communication
Ensuring information and knowledge are being effectively shared vertically and horizontally within an organization is a phenomenal advantage for any team. Maintaining alignment from the top of the organization down and horizontally keeps everyone on the same page and doing their most productive and strategic work.
It’s been reported that increasing horizontal communication within an organization helps to meet organizational goals, decrease misunderstandings and miscommunications, solve problems faster, increase efficiency, and enhance mutual understanding among peers.
Example: marketing & sales alignment as an organization grows
As companies scale up, it can be hard to maintain alignment between teams. For example, although expanding a team from three to four people grows the team by only 33%, you will see that complexity increases by 400%. One of the most commonly discussed connections is that of marketing and sales teams. As teams grow, interactions can become less frequent and discussions less detailed.
Some best practices can help ease this misalignment, such as prioritizing regular meetings, effective onboarding, and using collaborative tools. When implemented, these practices can decrease the likelihood of isolated teams and create stronger, more cohesive, aligned, and collaborative work environments.
To maintain or increase productivity and revenue generation across an entire organization, today’s business leaders increasingly need to prioritize internal relationship management to guide the development of high-performance teams. Without strong internal relationships, teams become siloed, leading to fragmented efforts and weaker external relationships.
3. Collaborate internally, to drive value externally
There’s no question that collaborating with colleagues increases the amount of value you’re able to deliver in terms of products and services to your customers.
When teams work together and have access to the same customer data, they nurture customer relationships better and do their jobs more effectively. Teams that work closely together, leveraging each other’s expertise and sharing customer insights with each other, they’ll be more nimble and capable of exceeding customer expectations.
Recent research has also shown that higher internal collaboration is linked to an increase in billable hours, more work billed, and higher originations.
Example: from team-player to rainmaker
Heidi Gardner, Distinguished Fellow at Harvard Law School’s Center on the Legal Profession, has conducted research that found that when professionals collaborate across lines of service, they earn higher margins, client loyalty increases, and they are able to charge higher rates for the work they deliver. Her research has found that the more you collaborate and involve specialists across your firm, the more strategic advice you are able to offer your clients, and the more revenue you’ll be able to generate.
To illustrate this, the article describes a comparison between two lawyers who graduated from the same law school, practiced the same number of years, and billed the same number of hours.
The difference was Lawyer One involved six partners in the work he generated, while Lawyer Two involved 30. The result? Lawyer Two generated four times more revenue than Lawyer Two.
If internal relationships are not optimized, external relationships will inevitably suffer. Siloed teams struggle to provide the comprehensive, coordinated service that modern clients expect, making internal collaboration a crucial factor in external success.
4. Foster a diverse and inclusive workforce
Investing in DEI and fostering a culture of collaboration where people from diverse backgrounds are connecting with each other can have profound impacts on a businesses success. Building a diverse, internal network of colleagues, teams and individuals benefits the organization by introducing diverse perspectives founded in different beliefs, backgrounds, culture, and education. This provides a wider vision and broader possibilities to navigate business challenges.
Example: diversity drives high performing sales teams
In November 2021, Forrester published a study on how Diversity Drives Sales Success. According to the research, companies with stronger DEI practices also produced better sales outcomes. Through an online survey with 500 US respondents in B2B sales leadership, Forrester discovered that leading DEI teams had to following in comparison to those that lagged in DEI:
- 3% higher sales forecasts
- 28% higher conversion rates
- 12% higher sales attainment
- 6% higher customer satisfaction improvements
Without a diverse and inclusive internal network, organizations miss out on varied perspectives and ideas that drive innovation and adaptability in external relationships.
Your next steps
The power of internal relationship management is unmistakable. When organizations invest in fostering collaborative workforces, the results can be transformative in advancing some of their most important business goals; from revenue acceleration, to diversity and inclusion, succession planning, and change management. Strong internal relationships directly lead to stronger, more effective external relationships. On the other hand, if your teams are siloed, it can hurt your growth and success with clients.
Introhive is a relationship intelligence platform that transforms your messy data into real insights and opportunities, delivered directly to your revenue teams when and where they need them. Introhive seamlessly enables organizations to use their greatest asset (relationships) to drive revenue and adapt for the future.
Introhive’s relationship mapping tools give you a clear view of your firm’s network and help you make the most of these connections. By analyzing and visualizing all your relationships, Introhive helps you find growth opportunities that go beyond the top decision-makers. Seeing how your colleagues are connected to clients can naturally spark conversations about the client’s evolving needs, business goals, and new opportunities for services, especially when there are changes in the regulatory or economic environment.
Book a demo to learn how Introhive can help your business grow revenue, relationships and retention.
FAQ on internal relationship management
How can effective internal relationship management transform an organization?
Effective internal relationship management can transform your organization by fostering better communication, enhancing collaboration, and breaking down silos. When employees across the organization are well-connected internally, they can share knowledge and insights more freely, leading to better problem-solving and innovation.
This type of environment also enhances your ability to identify and deliver greater value to your client. Ultimately, strong internal relationships lay the foundation for stronger external relationships, driving overall business success.
What role does Introhive play in enhancing internal relationship management?
Introhive’s relationship mapping tools help you see your firm’s entire network, making it easier to leverage these connections. By analyzing, segmenting, and visualizing all your relationships, Introhive helps you spot growth opportunities beyond just the top decision-makers.
When you see connections to clients across your firm, it naturally leads to conversations with colleagues about the client’s changing business needs, goals, and potential for additional services, especially when there are regulatory or economic changes.
For example, if you’re working at a global firm trying to maintain and grow its client base in different regions, Introhive can help you and your partners effectively tap into your networks to seize new opportunities.
What are the best practices for improving internal relationship management in the workplace?
Improving internal relationship management involves several best practices:
- Establish your network early: Focus on building your network from the start by making strategic connections that align with your role and goals.
- Promote vertical and horizontal communication: Actively share information and knowledge across all levels and departments to keep everyone aligned and informed.
- Foster collaboration: Look for opportunities to work closely with colleagues, share customer data, and leverage each other’s expertise to enhance value delivery.
- Invest in diversity and inclusion: Engage with a diverse group of colleagues to gain varied perspectives and ideas, driving innovation and adaptability.
- Utilize collaborative tools: Make use of tools that facilitate communication and project management to maintain alignment and reduce misunderstandings.
By following these practices, you can help create a more connected and productive workplace, leading to better outcomes both internally and externally.
