Alliance success
Why are some alliances successful and others not?
Identifying 'why' alliances are successful is difficult
We have analysed out database of hundreds of partnership surveys conducted on behalf of clients to try and understand why some alliances are successful and others are not.
- It is relatively easy to distinguish between successful and unsuccessful collaborations. In successful collaborations the milestones and goals set out at the initiation of the collaboration are met and the partner provides broadly positive feedback.
- However, in our experience, achieving the commercial or research goals of a collaboration and positive feedback from the partner, do not necessarily go hand-in-hand. Sometimes commercial milestones are met and yet the teams loathe each other. Other times, the milestones are missed, the project fails and yet the feedback from the partner is positive. It can be difficult to unravel the relationship between commercial success and the feedback from the partner.
- We believe that this difficulty is largely a result of the fact that most collaborations and alliances in the life sciences are simply too complex, have too many personalities involved, and are too subject to factors outside the control of either party to be able to derive a simple formula for success.
- On some factors covered by our database, most companies score relatively well. Those factors include the quality of the company's staff and its commitment to science.
- On the other hand on some factors, mainly cultural, most companies, even the best performing companies, score relatively poorly. Those factors include decision-making, flexibility, knowledge sharing and having an effective problem-solving and 'can-do' culture.
- Given the fact that factors like openness, knowledge sharing and problem-solving are at the very heart of the innovative ethos the disjoint between partners' perception of the companies' science and knowledge sharing is curious.
- On other factors there is wide variance between the best and worst performing companies in the dataset. Those factors are clustered around two issues:
- The governance of the collaboration; and,
- management and stability of the team working with the partner in the collaboration.
- Much of the issues to do with the management and stability of teams arise out of the wave of mergers and restructuring that many large companies have gone through over the past few years. For a partner a merger or a major restructuring often mean uncertainty as the company reviews its strategic directions. It also forces them to come to terms with and understand a new organisational structure and build its relationships again with a new team. The challenge for the partner is not eased by the failure of many companies to explain the changes to partners and to implement effective handover processes.
- Notwithstanding the above we can point to some factors that will contribute to successful collaborations:
- The most effective organisations shows a real commitment by their senior management to collaborations and partnering.
- The most successful companies have autonomous alliance management teams reporting into senior management at a high level. As well as making alliance management a core function of the organisation this autonomy in itself signals to partners that the organisation has commitment to collaboration.
- Effective organisation staff their alliance operations with experienced team members who have a deep understanding of their organisation, the partner organisation and the history of the collaboration. The balance between experience and new blood in these teams is carefully managed.
- The organisation is stable, both structurally and strategically. Unlike many other commercial relationships, collaborations require a long-term commitment by both partners. A company that it organisationally or strategically unstable is going to find it difficult to plan and manage for the long term or to signal commitment to partners.
- The organisation puts into place regular monitoring and listening processes where the partners are asked to help the organisation improve by offering constructive feedback.