Rarely do executives face a single option for an alliance partner. Too often, however, they focus on one dimension of a particular partner, or become overly committed to a single option. Given a clearly defined strategic role for alliances, companies should evaluate potential partners using a fact-based assessment of strategic, operational, and cultural elements — not just of potential partners, but also of their own firms, too. High-level evaluation suffices early in the screening process. As the list of potential partner firms shortens, prudent executives refine the assessment. Timing is vital. A well-managed search process greatly simplifies negotiation and contracting, and transitions smoothly into operation. With important alliances, this cannot be left to chance.
By engaging in substantive discussions early in the process, executives can manage expectations and avoid misunderstandings. Conflict during the pre-launch period can impair alliances for months, delaying benefits and limiting upside. The search-and-contract process requires orchestration of business leadership, business development, procurement, legal, operations, and alliance management. Success does not happen accidentally.
Leading alliance firms tend to become partners-of-choice in their industries. Cisco in high tech, Eli Lilly in pharmaceuticals, and IBM in systems integration are well known as desirable alliance partners. Sustainable partner-of-choice status is built on more than market position; it requires a reputation for excellence as an alliance partner. Firms that excel in both their own business and in alliance management have a significant advantage in the pursuit of attractive alliance partners. True North helps its clients to establish themselves as preferred partners.