One of the questions I received about the article “The benefits of a dedicated alliance function” was on how to organize such a dedicated alliance function.
The best model, which already works for several successful alliance companies, consists of a multi-layer structure:
The dedicated alliance function is in most cases connected to the strategy office, and is often headed by a VP of Alliances or by a Chief Alliance Officer. This person carries the overall responsibility for the alliance strategy and the strategic alliances in the company. To do so, the Chief Alliance Officer works closely with the CEO of the company, the strategy department and the department for mergers and acquisitions.
In the alliance office, the Chief Alliance Officer works with a number of dedicated people in the function of alliance consultants. These people are the alliance experts of the organization. They guide the businesses in creating and managing alliances. As such, they are involved in many alliances and are constantly expanding their alliance experience and knowledge.
The third layer in the function is formed by the people in the business units who actually manage the alliances. They perform the tasks of the daily alliance management next to their existing jobs and in most cases, the alliance they are running is already part of their existing business portfolio. They know all the details about their particular alliance and their alliance partner and they will also actively manage the partnership.
A potential fourth layer in the alliance function, is a more extended layer. This layer is the wider alliance community that consists of people who have an interest in alliances, but are not directly involved in the day to day alliance creation or management. This can be in functions like legal, intellectual property, contracts, procurement, and strategy. Also, people who have previously been involved in alliances or have a potential interest for future alliances, are part of the community. Even though the involvement of these functions and people might not be on a daily basis, it is good to keep them in the loop.
This alliance community is the most disconnected of the four layers and hence requires the most conscious effort to keep them informed. This is the easiest layer to forget or to give lower priority. Thus it might be helpful to have a regular form of communication with them, albeit a newsletter or internal social media channel, to share lessons and successes. This will help to keep the community (in all layers) involved and informed.
The function as described above, might feel as a heavy department if your organization is not that far on the journey of alliances yet, or if you are working in a smaller organization. The model is most often implemented in a growth model. It starts mostly with one, or a few, dedicated alliance consultants. These consultants are tasked with professionalizing the alliance function in an organization. Often one of them will act as a team leader and might rise through the ranks to become the Chief Alliance Officer.
Also, I have seen companies that start with external alliance consultants in an interim role. They are then tasked with designing the company specific alliance process framework, designing the blueprint for the alliance office and are then instrumental in hiring company dedicated alliance experts.
Like with many questions on alliances topics, also the answer on “how to organize the alliance function” will start with “it depends”, as it depends on your organization and where you are in the alliance journey.
So, let’s turn the tables: “How is your alliance function organized?”