Apple and IBM – Can they make 1+1 become 3?

Apple and IBM
Can their legacy work together?
It’s all over the inter-webs: Apple and IBM announced a strategic alliance yesterday! A bold move that brings together two companies in different areas of the ICT field. Once competitors and now completely complementary. At least, that is what the announcement wants us to believe.

Back in 1984 IBM and Apple to a certain extend had been competitors and the belief was exaggerated by the famous 1984 Superbowl TV commercial of Apple. However, somehow the official announcements step easily over the fact that Apple and IBM already have been in three different strategic alliances since the competing times. Three alliances that had their own level of success or lack thereof.

Will this be a successful alliance? From industry and technology perspectives many assessments are floating the web and on the outset it looks, and is presented, like a 1+1=3 alliance. An alliance where the results of the alliance will be greater than the sum of the parts.

However, there are more elements required for an alliance to be able to deliver on its promise. More than just the complementarity of two companies and their products and services; elements in alliance management that are in fact the glue that holds it all together and the lubricant that keeps the engine running.

There are 5 essential elements every alliance needs on the road to success:

1) Executive support
The Apple – IBM alliance clearly has executive support. With Tim Cook and Ginny Rometti being all over the news, they have positioned that well. Executive support is visibly there.

 
2) Alliance management
Rarely announcements make statements about how alliance management is constructed between the two companies and it neither does in this announcement. Having worked for IBM as an Alliance Executive in the past, I know that IBM knows fairly well how important the right alliance management setup is to make an alliance successful: to fight the internal red tape and to make sure the alliance operates as one.

IBM has many alliances and has at least one that has similarities to what the Apple – IBM alliance can become: their alliance with Cisco. Since 1999 this alliance has been growing and has been beneficial for both companies, strongly guarded by everything an alliance needs to be successful. This includes focussed alliance management teams on both sides.

IBM is known for their capabilities in alliance management and has been an active promotor of the alliance management profession.

Apple on the other hand is to a lesser extend known about how they handle alliance management. The company is in many cases a more closed book. They have had their alliances with IBM before, with Microsoft, AT&T, Sony, HP and with Philips, but how they manage these alliances is not widely known.
 
3) Governance structure
The alliance governance defines how an alliance is managed. The alliance management function is part of the whole governance structure. But there is more to it. The structure requires elements like steering committees and a cadence of governance: a series of periodic meetings that enable you to manage the alliance activities in a systematic way.
 
4) Operating principles
Core values and operating principles define the way the two parties work together in an alliance. It will help to bridge the differences in the way the companies work. With Apple having a consumer background and IBM having a business to business background, we may assume that the cultures in the two companies will be different. Can the elephant dance with Apple? They can only if they sing from the same hymn sheet and that is exactly the role of the joint operating principles.
 
5) Actual kick-off and the first 100 days
In the Apple – IBM alliance the PR kick-off took place yesterday. That’s only where the alliance starts for the big audience. The alliance will need its internal kick-off as well to ensure that all team members are on board and understand what needs to be done. A lot needs to be done and put in place in the first 100 days of an alliance and perhaps the most important element is stakeholder management to ensure that everyone is on board for the alliance.
 

In the case of Apple and IBM I would expect, given both partners’ history with alliances, that alliance management is in place and well taken care of. And rightfully so! With just the product and market complementarity of the two companies, every alliance will be stuck as a promise and will not be delivered on. Alliance management is the glue that will keep the companies together and the lubricant that will make the alliance run as a smooth operation. It will enable companies to create an alliance where the results of the alliance will be greater than the sum of the parts, an alliance where 1 + 1 becomes 3.


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