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The Next Wave in Collaboration? Lessons from Platform Ecosystems, Part 1: From Alliance Lifecycle Phases to ‘Minimum Viable Partnerships’

Posted By Contributed by Ard-Pieter de Man, CSAP, PhD, Wednesday, January 9, 2019

In my recent Q4 2018 Strategic Alliance Quarterly article about the emerging profession of the ecosystem manager, I mentioned that the most extreme examples of ecosystem management were found around platform organizations like Facebook and Apple. These platform-based ecosystems provide a glimpse into the future of alliance management. In fact, the future may already be here—and not just in information technology. At the November 8-9, 2018 ASAP European Alliance Summit, I heard about some fascinating examples of pharma companies that build platforms, use artificial intelligence, and connect an increasing variety of ecosystem partners. Other cases are easy to find: John Deere, not exactly a Silicon Valley start-up, and Signify (previously Philips Lighting) are examples of long-established companies that discovered that the mix of platforms and ecosystems holds great promise. What inspiration can we draw from the way these companies manage their ecosystems?

To answer that question, I focus on three characteristics of platform ecosystems.

  • First, the high speed of developments around platforms. As a consequence of that speed, partnerships need to be set up rapidly and must be easy to dissolve.
  • Second, increased unpredictability of new developments, because of the high diversity of technologies and business models that are introduced into the market.
  • Third, an increase in the number of partners, including many partnerships that are not traditional alliances.

Many existing alliance best practices do not fit well with these characteristics of ecosystems. To deal with them, new best practices are emerging that require us to rethink some of the classic tenets of alliance management. I will discuss four of them.

The Alliance Lifecycle: From Phases to “Minimum Viable Partnerships”

The alliance lifecycle has been one of the foundations of alliance management for more than twenty years. The lifecycle divides the process of alliance management into distinct steps:

  • setting the alliance-specific strategy
  • partner selection
  • negotiation
  • planning
  • structuring and governance
  • launching and managing
  • transformation

This structured process has proved to be very effective. It gives managers an alliance-building framework that ensures relevant issues are dealt with in the right order.

It has one huge drawback, though, in an ecosystem world: it is slow. It may take over a year before all the steps are covered. A second problem is that following all these steps in a strict order makes it difficult to adjust an alliance to changing circumstances. The alliance lifecycle assumes an alliance can be relatively stable for a longer time period and requires episodic instead of continuous change. In an ecosystem world, however, alliances may be in a continuous state of transformation.

Instead of using the alliance lifecycle, alliances may be seen as start-ups that evolve continuously and rapidly. Hence proposals begin to emerge to use the lean start-up methodology for alliances. At the 2018 ASAP European Alliance Summit, Jan Twombly, CSAP, president of The Rhythm of Business, showed how to adapt the firm’s “rhythm of business” methodology—in essence, how to use lean start-up methods—to create “minimum viable partnerships” that do not go at length through all the elements of the alliance lifecycle. This allows for fast partnering and continuous adaptation, and provides an alternative for the alliance lifecycle.

Ard-Pieter de Man, CSAP, PhD, is professor of management studies at the School of Business and Economics of the Vrije Universiteit Amsterdam. A longtime ASAP member, he also is a consultant to companies and not-for-profits. Part Two of this three-part blog series discusses how traditional alliance diagnostics make way for real-time monitoring of partner (or ecosystem) health.

ASAP Media encourages diversity of thought and opinion as partnering practice and the profession of alliance management continually expand and evolve. To contribute your voice to the conversation, on this or other seminal topics relating to business collaboration, please contact John W. DeWitt, editor and publisher of ASAP Media and Strategic Alliance magazines, at 646-232-6620 or jdewitt@asapmedia.org.

Tags:  alliance  alliance-specific strategy  Ard-Pieter de Man  ASAP European Alliance Summit  ASAP Strategic Alliance Quarterly  governance  John Deere  launching  managing  negotiation  partner selection  Philips Light  planning  structuring  traditional alliance diagnostics  transformation  Vrije Universiteit Amsterdam 

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