Balanced Scorecards for alliances and partnerships: Lessons from the ASAP European Conference
At the end of April I was invited to talk at the ASAP European Conference on the subject of Balanced Scorecards for alliances and partnerships. So I chose the title, “How not to screw up your alliance”.
What was wonderful about the conference was the way that the participants demonstrated the alliances and partnership culture in the way they shared information, presented and discussed topics and issues. There were representatives from companies as diverse as BT, HP, SAP, Phillips, Glaxo, Reckitt Benckiser, AMEC, BASF, proctor & Gamble, Rolls Royce, and many more.
Mike Nevin of Alliance Best Practice provided some fascinating examples of how the characteristics of aan alliance can be “benchmarked” so as to provide a basis for improvement. Improvements that immediately leads to revenue from alliances. There were also many examples of how alliances can work in different ways, from partnerships of equals to niche players teaming up with bigger players.
Professor Art-Pieter deMan from Eindhoven university presented research into alliance competencies and what makes them succeed. In if he listed five competencies that distinguished successful alliances from unsuccessful ones. There are:
- Individual evaluation and learning from the Alliance
- Joint evaluation and learning from the Alliance
- Alliance Metrics (Scorecards)
- Cross Alliance evaluation (Across the portfolio)
Successful alliances had more than 60% of these characteristics in place. Unsuccessful ones had less than 40% in place. It is fascinating to note how the learning and metrics are mixed together in these research findings.
I presented at the end of the second day. The topic was called, How not to screw up your alliance, and covered the Organisational learning model of learning, balanced scorecards, strategy maps for alliances and alliance portfolio management as well as how power and influence affect strategy and choice. OK that is a lot in 45 minutes, but it provided a useful rounding off of the conference themes.
Several things were clear from the Alliance Balanced Scorecard discussion
- Its all about revenue – without that, alliances are a waste of time
- You can measure alliance performance in a variety of ways, but choosing the right measures that suit the competencies and state of development of your alliance at that time has to be more careful.
- It is about managing the portfolio and choosing the right alliances as much as managing the individual alliances.
From the strategy discussion it was obvious how power and influence in the market affected choice. It raised questions such as:
- What power and influence do you have – and do you want to have?
- How does power influence your choice of strategy (and revenues)?
- What choices position you for more power and influence?
- Choice of alliance partner comes before managing an alliance well.
A recording of the presentation is available, to ASAP members as are the slides. Better still I am happy to repeat the presentation and talk through the issues with clients.
I am available to talk on the subject of Balanced scorecards for alliances and partnerships, best practice and performance measurement in general. Simply contact me using the cbelow