The moment an alliance is launched and in existence, it is essential to keep it healthy. Only healthy alliances will prosper and be able to deliver the results expected at the initial stages. Unfortunately sometimes alliances fail during the execution. Companies are no longer aligned, miscommunications occur or objectives at one of the partners change. Unfortunately, it happens all too often. The solution is transition; either end the alliance or continue in an adjusted format. But before the alliance partners can go into that stage, it needs to become clear what the issues are. Time to assess the alliance.
In one case a customer asked me to come in and assess their alliance with another company. It was a David and Goliath scenario, where Goliath felt that there were issues that could not be discussed with David. The alliance was in existence for four years and had started in good faith and with enthusiastic and willing teams. David was a four employee large organization in one location, while Goliath was a multinational with people in different countries. Also, Goliath’s project team was spread around several locations. Each of the partners had what the other lacked; David was on top of a breakthrough innovation and Goliath had the resources to help develop additional products, to jointly be able to deliver a fantastic value proposition to the market.
My assignment was to assess the alliance from a Goliath perspective and come up with recommendations for improvement and to see if I could find an answer where it had gone wrong. To that end I scheduled a series of interviews with Goliath employees who were, or had been, involved in the project. The interviews with the Goliath people made clear that some elements had been overlooked in the process of shaping the alliance. In the excitement of the opportunity, a solid strategic rationale had not been investigated, nor had partner selection been done. The excitement about the breakthrough opportunity rushed them into the partnership from a defensive perspective as well: “If not us, then someone else will jump on this solution and we will be second”. Generally not a good strategy to start an alliance.
At hindsight while doing the analysis, it showed that the opportunity was still valid and that the two companies with proper alliance management still could work together, with some points of attention to keep in mind during execution of the alliance. If they did not have these points of attention, these attention points might turn into roadblocks, which they did. During the meeting in which we discussed the findings and possible solutions with Goliath’s management, non of the roadblocks appeared to be obstacles that could not be overcome. Goliath felt that the opportunity was still valid and interesting enough to do the work that needed to be done to overcome the roadblocks.
Some of the elements in this alliance had to do with differences in culture between the two organizations. Differences that can be expected with two companies this different in size and in time of existence. These culture elements can generally be managed in the operation of an alliance, but only when one is aware of them. They were also elements that still could be adjusted. The assessment showed some less obvious and alliance specific elements that also could be adjusted. Obviously given the confidential nature of the assignment, these can not be summarized in this blogpost.
The lesson we can learn from this case, is a reconfirmation that “good preparation is half the battle” and that the initial stages in the alliance lifecycle should not be taken lightly. They are there for a reason and help in assessing the opportunity and provide handles for later management of the alliances.