After studying many of the enterprises featured in Fortune Magazine’s“America’s Most Admired Companies” issue over the years, I started to notice an intriguing pattern: Each and every CEO and Chairperson of these “most admired” organizations energetically maintained the belief that an important key to their companies’ success was engagement in strategic alliances.
Sure, some executives called the strategy “searching for business-building synergies” while others called it “seeking symbiotic relationships,” and others referred to it simply as
“partnering.”
Nonetheless, they were all saying the same thing. There is clearly “strength in numbers.”
Could UPS, Intel, Hewlett-Packard, Pfizer, Caesars Resorts, Johnson & Johnson, Microsoft, Southwest Airlines, Rubbermaid, Coca-Cola and Home Depot be wrong? Were their key executives so focused on courses in business, finance, technology and economics in their younger days that they never took an American literature class in college and read Robert Frost’s wonderful poem, “Mending Wall?” If they had, they might have been convinced that “good fences make good neighbours” and might have avoided anything that even closely resembled cooperating with other companies.
Obviously, Coca-Cola’s alliance with McDonald’s… Motorola’s alliance with Toshiba… Microsoft’s alliance with Apple computers.. and other examples fly directly in the face of Frost’s neighbor who, in the poem, was obviously a proponent of separatism..
Frost continued in his poem, “Something there is that doesn’t love a wall, that wants it down…”
Anyone conducting business in a time of stress, turmoil, complexity and high-velocity change… like now… should understand the need for allies and the importance of collaboration. After all, fences separate neighbors, companies and careers… and serve as barriers to growth.
A key to business development and success, especially in a complex, highly competitive time is NOT separatism. Instead, it is collaboration, open communication, affiliation, association, partnering and strategic alliances. Good fences block out neighbors who otherwise might become important allies and associates. Good fences block out the light. And just as light is the scientific key to natural growth, it also a key to career, business and product growth and prosperity.
Business is much too dizzy, busy and complicated for any one company (or employee) to be “all things to all people.”
It is illogical for any one enterprise to claim expertise and competency, for instance, in “Finance”… “Management”… “Marketing”… “Merchandising”… “Sales”… “Promotion”… “Public Relations”… “Management of Information Systems”… “Human Resources”… “Fully-Integrated Production”… “International Business”… etc. and more etc. Successful business ventures (or adventures as I call them) require expertise in all of the above and in every functional area.
Expertise can come in two forms, namely, “internal” (your own in-house competencies) and “external” (outsourcing, partnering, alliances, collaboration, etc.). Businesses cannot boast mastery in ALL functional areas of enterprise. That’s where collaboration comes in and can be a mutually beneficial value.
The three major benefits derived from a strategic alliance are powerful and important. They are
- Value
- Efficiency
- Growth
In short, if an alliance doesn’t provide both (or all) parties “value,” “efficiency” and a vehicle for “growth,” it is not a beneficial endeavor.
There are other benefits to alignment. They are
- Education
- Risk Reduction
- Expert Input
- Benefits of Association
- Information Sharing
Its tough to argue with these benefits.
Perhaps a time for a definition… a strategic alliance is a multi-faceted business association between two or more successful, solvent and compatible enterprises that require each party to…
- an inclination toward sharing,
- a predisposition toward honest communication,
- a willingness to allocate resources toward a common goal,
- a penchant for participation and association,
- a propensity for open cooperation and collaboration,
- an enthusiasm for the mutual transfer of knowledge, and
- once again… to be repeated… an inclination toward sharing.
Each company in an alliance must make ongong and
contributions to the alliance; each must bring to the alliance special skills, assets, contacts, technology, access, information, expertise and core competencies they are willing to share. Also, each company in an alliance must be a capable catalyst to create new value for all parties involved.
A compelling imperative is no alliance member can be dominant. All parties must be strong, solvent and successful.
All parties in an alliance must view the alliance as important. In fact, if the top executives in a company either are not actively involved in the alliance or are not totally supportive of the alliance, it will fail.
Businesses are too complicated not to consider developing mutually beneficial strategic alliances. This is NOT just about sharing technology or contacts or sales leads. Consider this a way to amass brain power through a highly effective alliance decision-making process. Each member of an alliance brings its own intellectual property, ideas, information, access, solutions, frame of reference, divergent thinking and frame of reference.
Collaboration can lead to the rise of of additional viewpoints
and alternative problem-solving and thinking. There’s a kind of safety net derived from sharing that helps validate decisions. Another way to think about this is the simple phrase “there’s safety in numbers…”
Good fences do NOT make good neighbors. Open up the gates of opportunity. Creatively use your contacts. Network! Build all kinds of integrated alliances. Collaborate on marketing, technology transfer, lead procurement, logistics, supply chain and more. Be creative.
Augusta Press columnist and Acworth, GA. resident, Ira Blumenthal, is a business consultant, a best-selling author, a globally reknowned speaker, an educator and a youth Lacrosse coach. Learn more about Ira and his latest book, Your Best Is Next, at www.IraSpeak.com Follow Ira on instagram @irajblumenthal and look for his latest book on Amazon; The Rundown; Safe at Home.
