Turning Professional Services Relationships into Revenue Engines
Author:  JB Radford
Abstract:   
Professional Services Organizations have as much to gain from successful alliances as those companies seeking to align with them. Yet many PSO executives are skeptical about the potential value based on dissappointing past experiences. The white paper proscribes a step-wise process of alliance formation and management from the perspective of the Professional Services Organization and in particular addresses the go-to-market needs for PSOs to drive service revenue while conserving up front investment.

Three Stages of Alliance Maturity :  A discussion of the stages of maturity commonly observed in international strategic alliances
Author: Mike Nevin, Managing Director, Alliance Best Practice Ltd.
Abstract:
This study empirically identifies three stages of alliance maturity through a benchmark of over fifty cross industry organizations.  Each of these stages reflects a level of evolution in a company's attitude to organizational partnering and is described as:
 
Stage I - Opportunistic.  As the label implies companies at this phase approach partnerships very tactically.

Stage II - Systematic, Organizations at this stage have recognized the long term value of partnerships and are making the investment in creating processes and practices to manage them effectively.

Stage III - Endemic Organizations at this stage are among the world's best at partnering and have embedded partnering into the very fabric
of 'the way we do business around here'.

The study further discusses the myths and challenges companies tend to encounter at each phase of this evolution.

Risky Business: Expanding Discussion on Risk and the Extended Enterprise
Authors: Robert E. Spekman and Edward W. Davis, Darden Graduate School of Business, University of Virginia,
Charlottesville, Virginia, USA
Abstract:   
Adversarial relationships between buyers and suppliers have long been the rule, and price reduction has been the key metric by which success has been measured. Although price is important, value is often created in ways that render price considerations secondary and emphasize innovation and information as critical elements in the value equation. Today, buyers realize that supplier involvement in new product design and processes provides benefits to the buyer that span areas such as engineering, testing, tooling, and other capabilities.
The case for an integrated supply chain is becoming more easily made as firms acknowledge the cost benefits and the competitive gains that result from supply chain partners working collaboratively to accomplish mutual goals.

Building and Managing Corporate Alliances in an Academic Medical Center
Authors: Teri Melese
Abstract:
Academic Medical Centers (AMCs) are in a position to help foster the development of better drugs by combining their considerable skills in the basic and clinical sciences with the
compounds, medicinal chemistry and know-how of pharmaceutical and biotechnology companies to develop a more innovative and coordinated approach to therapeutic intervention. To capitalize on this opportunity AMCs will need to develop an integrated internal administrative process to develop, manage, and implement corporate alliances, design the optimum structure for these relationships, proactively negotiate the actual partnership agreements, provide project management for collaborative projects, and make informed business and administrative decisions in a timely manner. The development of an AMC "corporate alliance" team that functionally and philosophically unites the academic administrative offices traditionally involved in corporate partnerships (e.g., sponsored research agreements, clinical trial agreements, material transfer agreements, technology transfer, etc.) is essential.

Partnering for the Future
The Case of the METRO Group Future Store Initiative
Authors: Tim Graczewski & Ard-Pieter de Man
Abstract: 
"The Future Store Initiative is our R&D lab," says Gerd Wolfram, managing director of the MGI METRO Group Information Technology GmbH and leader of the METRO Group Future Store Initiative. "By creating a real-life future store METRO Group and partners are able to test and develop new technologies that form the basis of innovation in retailing.” This, in essence, describes METRO Group's Future Store Initiative (FSI), a working supermarket in which a host of new concepts and technologies for the retail industry are developed and tested in practice. Initiated by the German-based METRO Group, the world's third largest retailer, the FSI brings together 58 companies that have jointly made it their goal to drive innovation in the retail sector and to set the standards for the early 21st century supermarket.

The Impact of a Poor Working Relationship on Alliance Performance
Authors: Jeff Weiss and Sara Keen
Abstract:
When alliances fail because the partners are unable to work well together, a great deal of potential value is left unrealized. Alliances that failed due to a poor working relationship on average would have realized five times as much value had they had a stronger working relationship. This study reveals the state of adoption of ten corporate capabilities essential to alliance relationship management. 

Getting a Grip on Alliances
Authors: James Bamford and David Ernst
Abstract:
A great many companies are still trying to figure out how to properly monitor their alliances and JVs and get them to perform as desired. Despite the 2002 Sarbanes Oxley Act and new Securities Exchange Commission and Financial Accounting Standards Board guidelines meant to improve transparency and accounting fairness related to third-party transactions, many companies continue to face challenges in developing a timely, accurate picture of the performance and risk profile of these economically complex entities.

Transforming Under-performing Strategic Alliances
Author: Erik G. Rule

Abstract:
Surveys indicate that 40-60% of strategic alliances are judged by participants to have not met their expectations. There is clearly a need to reverse these negative statistics that contribute to the wastage of valuable time and resources in trying to establish alliances that ultimately fail.
When indications emerge that an alliance is going sour, management must first decide if the alliance is worth saving. If so, and management decides to transform the under-performing alliance into a successful enterprise, a very important remedy is intervening early and with alacrity in the ailing alliance. Such intervention can achieve a transformation of the alliance only if it is focused on those competencies that are under-developed. This paper discusses four stages of alliance transformation to put ailing alliances back on the road to health.

Virtual Scale: Alliances for Leverage Booz Allen Hamilton Resilience Report
Authors: Doug Hardman, David Messinger, Sara Bergman

Abstract:
Only a few companies – giants such as Procter & Gamble, Wal-Mart, Dell and Toyota – are in the enviable position of being able to leverage their size into operational scale that consistently drives down per-unit costs and increases efficiency, creating sustainable competitive advantage. But, smaller companies can compete with these industry giants by pooling resources with carefully chosen partners.

Underdog Alliance™ Techniques: Pointers for Powerful Partnering
Author: Tom Fornoff, Vice President Business Development, 360Commerce.

Abstract:
Large and small companies alike can do great things through partnering. Alliances are an unbeatable way to leverage “other people’s money” to generate new sales leads, accelerate product introductions, or produce incremental revenue from existing customers. But alliances are complex and tricky, hard to control, and prone to failure in mysterious ways. Business partnerships are particularly challenging for smaller companies lacking alliance management depth and with limited resources to apply to the challenge.
Tom Fornoff offers a practitioner’s view based on two decades of partnering of the particular challenges when a small company partners with the big dog.

Microsoft Partnering for Mid-Sized Independent Software Vendors
Author: Brian Hansford, Director of Strategic and Corporate Alliances, Captaris, Inc

Abstract:
Microsoft has a partner ecosystem of 125,000 partners. How does a smaller company gain any value of partnership in a crowd that large? Brian Hansford provides experienced-based guidance on how to achieve a successful partnership with technology’s most partnered Partner. This paper asserts that the mid-market ISVs have a tremendous partnering opportunity working with Microsoft; however, ISVs must motivate Microsoft to partner with them by developing a solid value proposition that communicates technology alignment, revenue influence, mutual channel partners, customer evidence, and predictable behavior. This framework is one that ISVs can follow not only with Microsoft but other large technology companies.

Designing and Renegotiating Strategic Alliance Contracts
Authors: Dr. Jeffrey J Reuer and A. Ariño

Abstract:
Research on strategic alliances structuring has been dominated by a concern for the choice between equity or non-equity agreements. However, little attention has been paid to other structuring aspects, such as the choice of the contractual provisions that will regulate the relationship. Contract design is an essential part of alliance structuring, and contract renegotiation may become a key element of successful alliance adaptation. Designing and renegotiating complex contracts entail costs that are worth bearing when contractual safeguards reduce the costs and performance losses that stem from exchange risks. In this article, we identify some important conditions under which contract complexity and contract renegotiation are worth the costs they involve. We offer recommendations for executives concerned with designing alliance contracts.

An advisory from KMPG International

Abstract:
Companies today are increasingly looking for opportunities to expand their business through collaborations with external partners. These partnerships are often undertaken as alliances or joint ventures and have become a natural course of business. This is particularly true for companies that feel the need to expand to meet competitive pressures.

According to a new white paper from KPMG’s Transaction Services practice, “Alliances and Joint Ventures: Fit, Focus and Follow-Through,” the appetite for joint ventures and strategic alliances recently has spiked upward. We contend that focusing on the right fit and then following through with due diligence beyond financials is essential to making the partnership work.

The whitepaper also highlights other areas that we believe are keys to successful collaborations – strategy, partner selection, and execution. Companies succeed when executives employ fact-based decision-making, define clear goals, create and use effective metrics, and ensure consistent and open communication.

Value Chain Orchestration in Action and the Case of the Global Agrochemical Industry
Long Range Planning Journal, 2002
Authors: Andreas Hinterhuber

Abstract:
This article examines the concept of virtual value chain orchestration, an emergent phenomenon of strategizing and organizing. Virtual value chain orchestration is defined as way of creating and capturing value by structuring, coordinating, and integrating the activities of previously separate markets, and by relating these activities effectively
to in-house operations with the aim of developing a network of activities that create fundamentally new markets. The research is based on an in-depth analysis of the agrochemical and biotech industry and is illustrated by two case studies. Consideration is given to steps needed for orchestrating a successful virtual value chain, including the conditions which might indicate when strategic alliances, rather than joint ventures or acquisitions are used for capturing the value created. Based on the preliminary results of the case studies, the article concludes that the orchestration of an extended network of diverse partner companies leads to superior financial results.

Strategic Alliance Management: Lessons Learned From the Bayer-Millennium Collaboration  - Drug Discovery Today
Authors: Karl Ziegelbauer and Ronald Farquhar

Abstract:
Alliances play increasingly important roles in drug discovery and development– both complementing the companies’ internal technology and competencies, as well as providing partners with access to pipeline products and capital. The purpose of this feature article is to share the experience in managing the research collaboration between Millennium Pharmaceuticals and Bayer HealthCare AG, one of the largest pharma/biotech alliances. We describe the set-up of the collaboration and outline key success factors. These include complementary core competencies, continuous involvement of key executives from both parties, a dedicated and collaborative leadership, a close collaboration between scientists, research management, business development and patent and legal people, and a commitment to adapt the partnership to changes in the scientific environment.

Alliance Capability: In Pursuit of Value
Authors: Jeffrey Shuman, Ph.D. and Janice Twombly, Rhythm of Business

Abstract:
The central economic imperative in business today is to establish and grow relationships to create the strategic value that drives financial outcomes. Increasingly, these relationships rely on partnership, not ownership, to provide revenue growth and access to innovation, customers, and competencies, as well as to outsource non-core activities and mitigate risks.

However, companies do not get the financial benefits they seek from alliances and partnerships, absent an organizational ability to grow trusting, purposeful, mutually beneficial relationships. Unfortunately, despite all that we learned in the sandbox, collaboration is simply not a natural behavior in business. Study after study show that 50%-70% of strategic business relationships fail to meet their objectives, and that the primary cause is poor or damaged relationships. Focusing on relationships may seem soft and contrary to business objectives. In fact, succeeding at alliances and partnerships requires an organization to grow an alliance capability – the organizational ability to create and sustain successful collaborative relationships.

As alliance capability becomes more and more the imperative, companies are having an extremely difficult time making collaboration successful over the long term. Does this mean that, while collaboration works in theory, it can’t be practically applied? Not at all. But the question does strike at the heart of the problem, which is that while alliances and partnerships are advertised as being between companies, in reality, relationships are built between people. And that’s a very important distinction.

Optimizing Alliance Management
Authors: William Seidman, Cerebyte and Michael McCauley, Cerebyte

Abstract:
If you are like most companies with critical strategic alliances, there is a wide difference between the capabilities of many of your alliance managers, and as a result, a wide difference in the performance and value of your alliances. Some alliance managers are able to regularly create and sustain great alliances. Unfortunately, many alliance managers are relatively ineffective and more often than not alliances quickly breakdown.
This article examines the actual behaviors that promote highly positive, mutually beneficial win-win relationships. It goes on to discuss the strategies for institutionalizing effective alliance management throughout the organization, including the use of newly emerging Digital Coach Technology as a means of enabling every alliance to perform at superior levels.

Learning the biopartnering game: How to achieve more form your biotech alliance
Authors: Dr. Sinead B. Clarke IBM, Dr. James W. Cortada,, IBM, and Heather E. Fraser, IBM

Abstract:
Recent advances in molecular science are expected to yield medical treatments targeted not just for individual ailments, but also for highly segmented patient groups. As they pursue this exciting vision, pharmaceutical and biotechnology (biotech) companies are actively engaging in alliances, according to BioPartnering 2004, a biotech industry survey from the IBM Institute for Business Value.

While large pharmaceutical companies once called the shots in the biopartnering game, today’s biotechs have achieved a level of deal-making sophistication in keeping with their growing influence on the pharmaceutical industry. Still, less than half of respondents reported that their biopartnering alliances were successful. While 15 percent of alliance failures were attributed to reasons considered beyond the control of senior management, better alliance management practices could salvage 85 percent of the value now lost to failed partnerships – a potential sun of US $27 billion.

Creating Customer-led Corporate Alliances
Author: Hanock Eiron, Alliance Manager, Hewlett-Packard Company

Abstract:
Alliances play an increasingly central role in corporate strategy, particularly in the technology industry. Giants like Microsoft, IBM, Intel,Cisco, HP and Oracle clearly recognize that alliances are central to their corporate strategy and that they depend, to an increased degree, on other companies for their own success. Despite becoming so central to corporate strategy, alliances are generally poorly understood.

Corporate alliances can become more effective and predictable by focusing the partnership on delivery of well-defined value propositions to customers. This conclusion is based on years of practical experience in managing large and small corporate alliances. This paper offers a methodology for enabling companies to manage alliances more successfully, based on the guiding principle that partnerships are a means of delivering better solutions to customers.

Alliance Portfolios: Designing and managing your network of business-partner relationships
Authors: Salvatore Parise and Amy Casher.

Abstract:
In today’s networked economy, relationships with business partners are essential to a company’s survival and growth, yet most companies are still struggling to design and manage their key partner relationships for long-term value creation. Most companies approach the design and management of their business partnerships by focusing on optimizing each individual alliance. This approach gives priority to meeting alliance-specific objectives and allocating resources based on the strategic importance of each partner. Typically, however, a company will be involved with several alliance partners, and sharing of information and knowledge across these alliances is rare. In addition, a company’s alliances will often compete with one another, and with the internal organization, for limited resources.

An emerging perspective is to manage alliances as a portfolio, and to understand how individual alliances impact each other and the internal organization. We offer a portfolio approach to alliance design and management that builds upon existing alliance research and practice, and offers a fresh perspective reflective of what is happening in today’s business environment – networks of companies, both allies and rivals at the same time, collaborating in a dynamic and uncertain world. By under standing partner’ alliance networks, thinking about potential future projects with each partner, and developing processes to share information and knowledge across alliances, this approach seeks to minimize areas of friction in the portfolio and leverage areas of synergy.

Walking the Tight Rope: Balancing between Cooperation and Competition
Author: Dr. John H. J. Bell.

Abstract:
From ABC (Academia, Business and Consultancy) experience, it is more than evident that cooperation and competition are two sides of the same coin. Companies that cooperate with one another may at the same compete in other areas or may become each other’s strongest competitors because of the cooperation.

This paper describes topics that relate to the dynamics of delicately balancing between cooperation and competition in strategic alliances. As such, the focus is not only on the tension before and at the start of the alliance, but also during the lifetime of alliance. In addition to looking at alliance between two companies, alliances between competitors is discussed, and subsequently, dynamics of alliances between multiple partners. The last topic will cover what kind of capabilities companies should delve op to become and remain successful in dealing with the increasing complexities of the alliance portfolio.

The CFO’s Perspective on Alliances, Growth, Risk, and Measurement
CFO Research Services in collaboration with PricewaterhouseCoopers

Abstract:
CFOs Embrace Strategic Alliances as Major Growth Tool and Alternative to Higher-Risk M&A
Revenue growth, cost containment and risk sharing are key drivers More companies than ever before are relying on alliances with other companies to meet their strategic business goals—at times even using them instead of higher-risk mergers and acquisitions—according to a new survey by PricewaterhouseCoopers' Transaction Services group. Growth is the primary reason for forging alliances among executives more willing to use them today. 80 percent of executives who have become more willing to use alliances in the last three years cite the need for new sources of growth as their primary reason for doing so, compared with 56 percent who use alliances primarily to cut costs. Risk sharing, greater agility, new product development, and gaining access to new distribution channels and geographical areas were also cited

Becoming a Premier Partner: Measuring, Managing and Changing Partnering Capabilities at Eli Lilly and Company, Journal of Commercial Biotechnology, Summer 2001
Authors: David Futrell, Marlene Slugay and Carol H. Stephens.

Abstract:
When Eli Lilly and Company decided to expand its drug development by entering into strategic ‘alliances’ with other, usually smaller, biotechnology firms, the company committed to becoming the ‘premier partner’ in the pharmaceutical industry. To implement that commitment, Lilly needed a way to measure how well it performed an s a partner. That seemed like a simple problem to solve. But the actual solutions required Lilly to invent two new measurement instruments developed and administered by PricewaterhouseCoopers. The tools serve complementary purposes. The PwC survey helps Lilly understand how it compares to other large pharmaceuticals as a desirable partner. Lilly’s new survey provides a ‘finer-grained’ picture of large, individual alliances by focusing on the factors that make up many of the categories in the PwC survey. The other new tool, a focus group guide and protocol, allows Lilly to assess the health of smaller alliances and to probe areas of broad concern identified in the quantitative diagnostic surveys. Using this technique combination of tools to assess the ‘health’ of their alliances, they are also improving Lilly’s overall capabilities as a partner.

Measuring the Value of a Strategic Relationship Management Organization,
Authors: Jeffrey Shuman, Ph.D. and Janice Twombly

Abstract:
Strategic business relationships are mission-critical imperatives for growth in every industry
Unfortunately, succeeding at strategic relationships is not a competency of most managers. In fact, studies have found that approximately 70% of so-called strategic business relationships (regardless of whether they are technically partnerships, alliances, joint development agreements, etc.), either fail completely or fail to meet expectations. This white paper describes the evolving role of the strategic relationship management organization as the profession embeds itself within the core competencies of businesses. We include a brief discussion [and examples] of several tools helpful in identifying, and communicating the value provided, demonstrating the benefits, and reporting results.

A First Step in Ensuring Successful Partnerships: The Relationship Launch
Authors: Jeff Weiss and Laura Judy Visioni

Abstract:
Today's global economy requires companies to do more with less under increased competitive pressure. To keep up, executives are turning to alliances, joint ventures, consortia, outsourcing arrangements and other forms of partnership that lengthen their global reach, enhance customer value, bridge gaps in their own capabilities and gain competitive advantage. Indeed, partnerships, which are proliferating at an unprecedented rate, are integral components of most company's strategies today.The 21st century will only see this trend continue as globalization and competitive pressures increase. Thus, organizations will have to work more interdependently, as traditionally arms-length relationships with suppliers, competitors and others become more intricate and as new forms of partnership take hold.This white paper breaks down the process of launching an interdependent relationship toward success into eight steps. Through this launch process new partners jointly define the desired relationship, assess possible obstacles, develop joint protocols for dealing with those obstacles, build mechanisms for managing the relationship, and put in place the necessary skills for sustaining a strong relationship over the life of a partnership.

The Drug Industry’s Alliance Archipelago
Authors: Jane C Linder, Samuel Perkins, U. Srinivasa Rangan, and Phillip Dover

Abstract:
Big pharmaceuticals have the money to fund the development and marketing of new things, but their R&D hit rate has not been sufficient to replace products coming off patent. Small biotechnology companies are awash in new technologies, but lack the case to bring products through the expensive regulatory approval process. Large biotechnology companies have products, but lack the sales muscle to market these broadly. Alliances between complementary companies have become part of the solution, but these have generated as many misses as hits. Babson College and Accenture Institute for High Performance Business have teamed up to explore why alliances have been challenging and how biotechnology and pharmaceutical companies can make them more effective.