Evaluating Strategic and Operational Compatibility of Alliance Partners
In order for a strategic business relationship, or “SBR,” to be successful the parties must be able to work together effectively at both the strategic and operational levels. Certainly the parties must establish the overall strategic goals and objectives for the arrangement and these should be clearly translated into objective measures of performance, budgets and milestones. However, it is equally important for the parties to invest the time and resources necessary to ensure completion of the day-to-day operational activities that will lead to attainment of the strategic goals and objectives.
The documentation for a comprehensive SBR generally provides for the establishment and maintenance of formal oversight procedures, such as a joint steering or management committee, to ensure that the SBR remains on track with respect to the pursuit and achievement of the major economic and technical objectives. While this can be an important tool in making sure that collaboration issues among the representatives of each party are identified and resolved the parties should consider taking additional steps to make sure that day-to-day activities and interactions between managers and employees involved in the SBR proceed smoothly.
It is now commonplace for companies to provide managers who will be involved in alliances with additional training on relationship building and discussing and resolving disputes. However, it is also recommended that the parties explicitly create, disseminate and enforce guidelines, or “behavioral protocols,” that everyone involved in the SBR–executives, managers and employees—should follow when engaging in alliance-related activities and interacting with colleagues from their partner. Examples of rules that might be formulated include the following:
Information regarding internal changes relating to business plans and organizational structure will be shared on a timely basis so that the parties can jointly consider the impact, if any, of those changes on the SBR.
Meetings and other discussions regarding problems and challenges that have arisen relating to the SBR will focus on generating solutions rather than simply raising problems and exchanging complaints and assertions of blame.
When representatives of the parties at lower levels are unable to resolve an issue on their own they will escalate the matter jointly within their organizations and collaborate on the preparation of background information to executives from both partners so that each side is fully informed and recognizes that resolving the issue is in the best interests of everyone.
Each party should undertake to pass on information regarding any complaints that they may hear from within their organization regarding the SBR so that the managers involved in the SBR can discuss the best way for both parties to work together to formulate a response to a complaint if such a response is warranted to ensure that the partners continue to enjoy the support of their internal constituencies.
Individual and group relationships between representatives of each party will be continuously nurtured through scheduled exchanges of information and opinions including regular weekly conference calls to keep in touch even when there are no specific important issues that need to be discussed or resolved.
These guidelines are rarely part of the formal documentation for the SBR; however, they should be set out in a written record and managers from each of the parties should be assigned responsibility for making sure that they are being followed. If all proceeds well the guidelines will become the basis for a specific “alliance culture” that is built on collaboration and communication. Once this unique culture is in place both parties should work hard to ensure that new personnel joining the activities of the SBR are properly indoctrinated. Inevitably the composition of the teams from both sides will change over the course of the SBR as new projects are identified or additional opportunities present themselves. When new persons join the team it is important to take the time to explain to them the overall purpose of the SBR, the progress that has been made, how their skills are expected to fit into the operational activities, and how the parties have elected to interact with one another.