Leadership in Strategic Alliances

Strategic alliances continue to develop in unprecedented numbers and in a broad range of industries including transportation, manufacturing, telecommunications, pharmaceuticals, finance and health care. At core, the strategic alliance provides a new level of organizational competitiveness. Unfortunately, leaders may be unprepared for a new world in which the boundaries between collaboration and competitiveness can be unclear. New leadership models and skills are needed for strategic alliances characterized by:
  • Value creation that is not preordained
  • Partnership relationships that evolve in an unprecedented manner
  • Shifts in market positioning—today’s ally may be tomorrow’s rival or may be a current rival in some other market
  • Alliance management that is more important over time than the initial formal design
  • Initial agreements that may have less to do with success than does the adaptability to change

Beyond the initial deal making, strategic alliances require a foundation based in value creation and a commitment to dynamic processes.

Value Creation

Alliances should be developed and managed by the determination of value creation. The most critical determinant of value creation is the degree to which the partners contributions are complementary. The following are key areas of assessment in determining the potential value creation of a strategic alliance.

Alliance Adaptation:The Learning Cycle

The dynamic process of value creation requires the leadership of strategic alliances to learn and adjust to each other over time—adaptation. As the relationship improves over time, partners are willing to make additional commitments. The following is an example of an alliance learning cycle: The success of strategic alliances is dependent on the strength of the value creation foundation and on each partner’s commitment and involvement in the learning process. Successful learning builds confidence and trust as partners learn how their interactions can be more efficient.

Pyrce Healthcare Group has assisted many organizations in assessing value creation of a strategic alliance and in facilitating the partnership development. E-mail us at phg-inc@ix.netcom.com to learn more about our strategic alliance consulting services.

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