Roundtable: Alliance Skill Set Ideal for Bridging Complex Cross-Industry Partnerships
Over the last several years, we have seen plenty of alliances between pharmaceutical and IT companies, the two industries in which alliance management is most fully entrenched. However, cross-industry partnerships are beginning to branch beyond pharma-IT collaborations. Whether it is to reduce carbon footprint, access digital capabilities, or simply elicit innovation, companies are looking outside of their own industry for partners that can help break the mold.
“We have moved from same-same industry alliances to working with partners in completely different industries,” said Brooke A. Paige, CSAP, who oversees digital alliances at Novartis. Paige relayed that a former colleague of hers currently working at a pharmaceutical company recently began work on a partnership with a supermarket chain. “If you’re not working on these deals, there’s a high likelihood you will be, especially as these industries converge.”
Paige offered this observation in ASAP’s recent roundtable “Digital Dilemmas: The Expanding Role of Alliance Professionals in Digital and Nontraditional Partnering,” in which more than three dozen alliance professionals from a variety of industries discussed the nuances of these types of relationships. Diana Favia McDevitt, CA-AM, business development executive for strategic services alliances and partnerships at Kyndryl; Aida Bendt, CA-AM, head of alliance management for Oncology Business Development and Licensing at AstraZeneca; Vin Sharma, vice president of program and alliance management at Alnylam Pharmaceuticals; and Emma Barton, director of alliance and integration management at AstraZeneca led smaller breakout groups where participants dissected the challenges that come with these types of alliances, and brainstormed some tips for handling them.
A World of Difference
It takes time and effort for two partners from the same school to learn to dance with each other, so it was no surprise when the four groups unearthed a long list of obstacles that could potentially arise when companies from different worlds try to tango. These include:
- Disparate cultures – One participant spoke of having to consider the needs of indigenous tribes as part of an oil-and-gas industry collaboration, while another Big Pharma employee recalled how a major university was more concerned with “thinking expansively” about novel targets, where her organization was narrowly focused on identifying molecules.
- Contrasting internal landscapes, including different funding cycles, levels of bureaucracy, decision-making processes, and short- and long-term outlooks—smaller companies often don’t have any eye on the longer view.
- Dissimilar industry norms – In particular, a heavily regulated industry like pharma may not be as nimble as an industry that has to adhere to fewer statutes.
- Different vocabulary and language—More than one attendee noted that it’s not unusual for two companies to have different definitions of the same word.
- Uncertainty over or complete lack of senior leader sponsorship – In response to one interlocutor’s assertion that it adds “unnecessary anxiety” when senior management gets too political in its decision making, a pharma-based alliance professional added, “And God forbid senior stakeholders change on a regular basis.”
- Lack of trust – Trust came up in multiple breakout sessions, with one insisting that it is “the biggest alliance asset and mistrust is the biggest alliance cost.”
In addition, alliance managers as individuals have more ramp-up, as it will likely take longer to learn the partner’s business model, value proposition, offerings, intellectual property, and industry than in a same-industry alliance.
Building Bridges Across Industries
As always, the alliance management skill and practice quiver has many arrows that can help alliance professionals and their companies work through these differences and make these collaborations thrive. Collectively, the breakout groups put forth several ideas for harmonizing companies from very unalike worlds.
Focus on governance, particularly at the outset of the collaboration. Fortunately, you don’t need domain expertise to build out a governance structure. Help develop and operationalize the alliance committees, establish timing for key decisions that need to be made, get the teams together at the appropriate cadence, and have everyone reiterate the partnership’s North Star to avoid “mission drift.” This is where alliance managers can establish communication lines and encourage behaviors that will lead to the building and retaining of essential trust.
Build bridges. As one attendee put it, “The alliance manager’s role is to bring together the silos.” Or as another participant said, alliance managers must “capitalize on the capacity that we have to get people to work together.”
Assume no understanding by the partner of your industry and how it works. By the same token, ask “dumb questions.”Your partner also cannot assume you have significant knowledge of its products and industry. Alliance managers have the freedom to challenge assumptions and bring a new perspective in a way internal employees and professionals from same-industry partner organizations oftentimes can’t. That also buys time to learn about the partner’s goals for the partnership, products and services, investment decision-making processes, and regulatory constraints.
Mitigate risk. It is arguably more important for alliance managers to lean on their core risk mitigation skills in cross-industry partnerships. As one attendee put it, nontraditional partnerships very often look to produce outcomes that are extremely innovative, but this means they come with a much higher risk/reward profile than traditional alliances.
Communicate with extreme clarity and transparency. This applies to interaction with the C-suite and senior management, as well as the people embroiled in the day-to-day affairs of the partnership.
Create a shared language. Unearth alliance “homonyms”—words that mean different things in the respective contexts of two companies and industries.
Visit the partner’s facility. A firsthand look at labs, testing facilities, and manufacturing floors can give a sense of the partner’s processes, capabilities, and infrastructure. “Seeing is believing,” said one contributor.
Think bigger. One breakout group mentioned that pharmaceutical companies must acknowledge that ecosystems span much wider than biotech (e.g., finance, IT, manufacturing). Another group noted that alliance managers can indirectly support innovation by casting their net broader and bringing other stakeholder groups into the alliance at the right time.
Be mindful of the lagging effects of the pandemic. Meet face-to-face as often as the respective companies’ policies and budgets allow, and understand that many individuals can still be suffering from PTSD related to the pandemic or other factors.
We couldn’t possibly fit every insight from an ASAP roundtable into a single blog post. That’s why ASAP members shouldn’t miss a chance to join these regular events.