A strategic alliance can be a powerful tool that can help companies achieve specific goals. But what exactly is an alliance? And why do companies do it? To help us understand more about alliances, we've asked the expert Emma Barton, Director, Alliance and Integration Management at AstraZeneca, to help us in this discussion.
"You're most successful when nobody really notices what you're doing. If things are going wrong, then it becomes very visible to senior management very quickly." - Emma Barton
A strategic alliance is like a partnership where both companies or partners have entered into an agreement to contribute in a significant way to achieve a specific goal. It's all about leveraging both parties' resources and expertise to develop an asset or commercialize an asset.
It's like forming a company around the asset, without the company, that has its own decision-making structure, investments, and governance. Its structure is purely based on the parameters of the agreement made by both parties.
When building deals, make sure that you're structuring them in a best way for the particular asset you're trying to achieve. Post-deal, it's all about managing risks that could emerge in executing your deal structure. There's usually three significant areas where risks come from; Human, infrastructure, and legal risk. Human risk is the biggest threat that you need to manage.
When it comes to managing human risks, communication is key. It's all about being transparent and breaking down barriers to be able to work together effectively. The pandemic might have affected this in a way because face-to-face is still better than virtual calls, but communication regardless is crucial.
One of the best things you can do is to create a team where everyone is comfortable interacting with their counterparts in the partner company so they can constantly work together to anticipate risks before they even arise.
The governance of an alliance is outlined in the contract that both parties have agreed to. Inside that contract is where you will establish the committee and the decision-makers of the partnership. The contract should also include things like; who are the people that will sit on the committee and what level of decision-making activity that they have.
The key is to find the right balance between robust decision-making while being fast and efficient. You don't want to set up governance that takes too long to decide. It will impede the progress of your partnership.
The key to making successful alliances is to enable and empower your experts to do their job. Give them the right tools and autonomy so they can be comfortable achieving their goals.
Also, you need to be able to manage differences and disputes along the way. Empathy is one of the most important things that you can do when solving disputes. Try and understand where the other party is coming from before you make any rash decisions.