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Strategic Alliances are quite ubiquitous in businesses nowadays, but most of them often go unsuccessful.<\/p>\nStrategic Alliances are quite ubiquitous in businesses nowadays, but most of them often go unsuccessful.<\/p>\n
A Strategic Alliance is referred to as \u201can agreement between 2 organizations to share resources to carry out a mutually beneficial initiative.\u201d\u00a0 The arrangement differs from a Joint Venture (JV) given that both firms in a Strategic Alliance remain independent. \u00a0Whereas, in a JV, 2 organizations share resources to create a separate company.<\/p>\n
Strategic Alliances<\/a> are typically formed to:<\/p>\n The undertaking may be formal or informal and there isn\u2019t any requirement for merging capital. \u00a0However; the role of each entity\u2014in the arrangement\u2014has to be clearly laid out.<\/p>\n The strategy of creating strategic rivals into Strategic Alliance partners has benefited organizations immensely.\u00a0 This strategy enables:<\/p>\n To cash in on these benefits, leading organizations endeavor to manage their Strategic Alliances worldwide\u2014assigning executives to oversee multiple alliances.\u00a0 However, the competencies required for Strategic Alliance Management<\/a> aren\u2019t well-known and are a bit convoluted.<\/p>\n Multiple research studies by MIT Sloan, spanning several years, suggest that a number of alliances fail to achieve their desired objectives. \u00a0In fact, the arrangement shows diminishing R&D performance, marginal returns, and declining absolute learning with subsequent partnerships between the same companies.<\/p>\n A major reason for this failure is the incompetence of alliance managers in handling the alliance portfolio and their tendency to make 3 misguided assumptions:<\/p>\n The old-school approach to managing alliances concentrated on individual alliances without appreciating the challenges involved in such a deal.\u00a0 \u00a0In today\u2019s competitive environment\u2014with factors such as globalization, innovation, and disruption constantly influencing businesses and partnerships\u2014leaders need to have the ability to simultaneously manage multiple partners scattered across various parts of the globe.<\/p>\n Strategic Alliance Management entails understanding the intricacies involved in generating value from such transactions and devoting the attention and preparedness required to do that.\u00a0 A holistic approach to Strategic Alliance Management encompasses 5 distinct, yet interrelated, phases that are required to be executed to form effective partnerships:<\/p>\n Let\u2019s discuss the phases of approach in a bit detail.<\/p>\n Strategic Alliances are deliberate partnerships between organizations to expand their existing product \/ service offerings. \u00a0A potential partner\u2019s prior experience in forming and maintaining alliances is a key constituent of selecting the right partner. \u00a0This experience supplements internal capabilities and add value to the processes, knowledge, as well as portfolio of services \/ products.<\/p>\n A detailed assessment of a partner\u2019s experience assists in highlighting the benefits of partnership and negotiating with the partners. \u00a0The assessment should measure effectiveness of internal communication, adequate resources, and prioritized management\u2019s attention essential for a viable partnership.<\/p>\n In this stage, the alliance partners outline the conditions of the relationship, roles and responsibilities, and potential returns from the partnership.\u00a0 Negotiators typically tend to focus on capturing the bulk of potential value without any regard for the other partner.\u00a0 This damages the partnership and leverages no value at all.<\/p>\n The partners should be quite open and thorough about defining the scope of work for each affiliate. \u00a0Appointing a project steering committee assists in information sharing and coordination.\u00a0 Proactively planning the deal exit terms and procedures at the outset aid in later stages.<\/p>\n Interested in learning more about the other phases of the Strategic Alliance Management approach?\u00a0 You\u00a0can download\u00a0an editable PowerPoint on Strategic Alliance Management framework\u00a0<\/b>here<\/a>\u00a0<\/u>on the\u00a0Flevy documents marketplace<\/a>.<\/p>\n You can download in-depth presentations on this and hundreds of similar business frameworks from the\u00a0FlevyPro Library<\/a>.\u00a0\u00a0FlevyPro<\/a>\u00a0is trusted and utilized by 1000s of management consultants and corporate executives.\u00a0 Here\u2019s what some have to say:<\/p>\n \u201cMy FlevyPro subscription provides me with the most popular frameworks and decks in demand in today\u2019s market.\u00a0 They not only augment my existing consulting and coaching offerings and delivery, but also keep me abreast of the latest trends, inspire new products and service offerings for my practice, and educate me in a fraction of the time and money of other solutions.\u00a0 I strongly recommend FlevyPro to any consultant serious about success.\u201d<\/p>\n \u2013 Bill Branson, Founder at Strategic Business Architects<\/p>\n \u201cAs a niche strategic consulting firm, Flevy and FlevyPro frameworks and documents are an on-going reference to help us structure our findings and recommendations to our clients as well as improve their clarity, strength, and visual power.\u00a0 For us, it is an invaluable resource to increase our impact and value.\u201d<\/p>\n \u2013 David Coloma, Consulting Area Manager at Cynertia Consulting<\/p>\n \u201cFlevyPro has been a brilliant resource for me, as an independent growth consultant, to access a vast knowledge bank of presentations to support my work with clients.\u00a0 In terms of RoI, the value I received from the very first presentation I downloaded paid for my subscription many times over!\u00a0 The quality of the decks available allows me to punch way above my weight \u2013 it\u2019s like having the resources of a Big 4 consultancy at your fingertips at a microscopic fraction of the overhead.\u201d<\/p>\n \u2013 Roderick Cameron, Founding Partner at SGFE Ltd<\/p><\/blockquote>\n","protected":false},"excerpt":{"rendered":" Strategic Alliances are quite ubiquitous in businesses nowadays, but most of them often go unsuccessful. A Strategic Alliance is referred to as \u201can agreement between 2 organizations to share resources to carry out a mutually beneficial initiative.\u201d\u00a0 The arrangement differs from a Joint Venture (JV) given that both firms in a Strategic Alliance remain independent.… Strategic Alliance Management<\/span><\/a><\/p>\n","protected":false},"author":110,"featured_media":9336,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"neve_meta_sidebar":"","neve_meta_container":"","neve_meta_enable_content_width":"","neve_meta_content_width":0,"neve_meta_title_alignment":"","neve_meta_author_avatar":"","neve_post_elements_order":"","neve_meta_disable_header":"","neve_meta_disable_footer":"","neve_meta_disable_title":"","footnotes":""},"categories":[81],"tags":[2555,2553,2554,2556,1690,910,2552,2116,2368],"class_list":["post-9330","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-strategy","tag-alliance-partner-selection","tag-alliance-portfolio","tag-deal-negotiation","tag-planning","tag-portfolio-management","tag-strategic-alliance","tag-strategic-alliance-management","tag-strategic-partnership","tag-value"],"_links":{"self":[{"href":"https:\/\/flevy.com\/blog\/wp-json\/wp\/v2\/posts\/9330","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/flevy.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/flevy.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/flevy.com\/blog\/wp-json\/wp\/v2\/users\/110"}],"replies":[{"embeddable":true,"href":"https:\/\/flevy.com\/blog\/wp-json\/wp\/v2\/comments?post=9330"}],"version-history":[{"count":7,"href":"https:\/\/flevy.com\/blog\/wp-json\/wp\/v2\/posts\/9330\/revisions"}],"predecessor-version":[{"id":9410,"href":"https:\/\/flevy.com\/blog\/wp-json\/wp\/v2\/posts\/9330\/revisions\/9410"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/flevy.com\/blog\/wp-json\/wp\/v2\/media\/9336"}],"wp:attachment":[{"href":"https:\/\/flevy.com\/blog\/wp-json\/wp\/v2\/media?parent=9330"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/flevy.com\/blog\/wp-json\/wp\/v2\/categories?post=9330"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/flevy.com\/blog\/wp-json\/wp\/v2\/tags?post=9330"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}\n
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<\/a><\/p>\nPartner Selection <\/strong><\/h2>\n
Deal Negotiation<\/strong><\/h2>\n
Do You Find Value in This Framework?<\/strong><\/h2>\n