“We have found that alliances have an uneven record in improving shareholder value. Our analysis of nearly 2,000 alliances formed over a four-year period shows that alliances impact share price; the 15 most active value-creators in our study increased shareholder value by $72 billion, but the 15 most active value-destroyers decreased the market capitalization by $43 billion.
Given the critical contribution of alliances, how can companies improve this rather modest overall success rate? More fundamentally, where do alliances go wrong? Not surprisingly, there is no single answer to either question. The executives we interviewed cited hundreds of explanations for alliance malaise and failure: Trust broke down. Strategies changed. Champions moved on. Value did not materialize. Cultures did not mesh. Systems were not integrated. The list goes on.
Although these explanations are valid, they are, in fact, symptomatic of problems far more profound. Our work shows that many companies are influenced by a number of destructive myths-misunderstandings about the true nature of alliances and how they should be managed. We have identified five fundamental alliance myths that undermine promising collaborations.
The first myth weakens the very strategy and design of alliances. The remainder relate to alliance execution: integration, governance, internal capabilities and performance measures. The future success of alliances depends on dispelling these myths that have become associated with corporate collaboration and developing a new set of alliance-management practices based on hard-core reality.”
Editor’s Note: This is a collection of articles all on the same theme – each (other than the introduction) elaborates on one of the myths identified.
Click to Add the First »