Benchmarking Alliances
A Discussion Document from Alliance
Best Practice
Issues addressed in this briefing pack
 Understanding Begins with Insightful Questions – In other words good data =
good decisions and bad data = bad decisions
 What would ‘good’ data look like (as opposed to bad or misleading data)?
 What should we measure and why?
 What would a good benchmark overview report look like?
 What are the proven common success factors (CSFs) in successful strategic
alliances?
 Why is benchmarking different from health checks?
 What is the typical revenue increase after a benchmarking exercise?
 Further Details
Understanding begins with insightful
questions1
 Why do some alliances succeed when others fail?
 Has there ever been any structured research in this area?
 Is there such a thing as alliance best practice?
 Is there a common ‘language’ or approach which can be applied
consistently across different types of relationships?
 What are the limited things that we should focus our attention on to
effect the greatest change?
 “The most valuable information for corporate decision-making is
concentrated in a relatively small number of sweet spots of information
that flows through a corporation2”
 What are the alliance sweet spots?
1
Anthony Robbins
2 The Performance Manager Roland and Patrick Mosimann and Meg Dussault
Alliance decision making cycle
 1Every decision making cycle depends on finding the answers to three core
questions;
 How are we doing?
 Why?
 What should we be doing?
 Today’s alliance manager needs integrated decision making ability in various user
modes; Strategic, Managerial and Operational
1
The Performance Manager Roland and Patrick Mosimann and Meg Dussault 2007
What would a good benchmark look like?
 Holistic and integrated representing all
aspects of the relationship
 Simple to understand (intuitive)
 Provide striking insights
 Reflect multiple dimensions of the
relationship
 Capable of action planning
 Capable of benchmarking
 Enable action to be taken linked to the
insights
 Simple to operate
 Reflect both / all sides views
 Encourage involvement and
commitment from all key stakeholders
 Objective and numeric
 Be capable of regular refresh
 Rigorously researched
Why are benchmarks different from health
checks?
Benchmarks
Health checks
 Based on objective scoring systems
 Based on subjective views and
opinions
 Based on competitive comparator
analysis usually not available to
clients
 Prescriptive because its based on
known common success factors
 Typical question = ‘What is the
degree of trust in the alliance from 0
to 100’?
 Results produce actionable outcomes
 Usually an internal exercise
 Based on views from existing
partners who want to please the host
client
 Typical question = ‘How ell do you
think the alliance is performing?’
 Unable to act on results
A typical benchmark report
Co1
 The Blue Line is one partner
O50
O49
 Now lets test understanding!
 How much consensus is there
in the relationship?
 What is going well and what
is going not so well?
 What particular dimensions
does the BIC base its success
on?
Co2 Co3
Co4
Co5
90
O48
O47
O46
 The Pink Line is the second
partner
 The Yellow line is sector best
in class (BIC)
O51 O52100
Co6
Co7
Co8
80
70
60
O45
Co9
50
O44
Co10
40
O43
T11
30
O42
T12
20
O41
10
T13
O40
0
T14
O39
T15
Cu38
T16
Cu37
T17
Cu36
T18
Cu35
T19
Cu34
Cu33
Cu32
Cu31
S20
S21
S22
S23
S30
S29 S28
S26 S25
S27
S24
Common Success Factors
Commercial Dimension
Strategic Dimension
Operational Dimension
 Co1 Business Value Proposition (BVP)
 S20 Shared objectives
 O39 Alliance process
 Co2 Due Diligence
 S21 Relationship Scope
 O40 Speed of progress so far
 Co3 Optimum Legal / Business Structure
 S22 Tactical and strategic risk
 O41 Distance from revenue
 Co4 Alliance Audit
 S23 Risk sharing
 O42 Formal business plan
 Co5 Key metrics
 S24 Exit strategies
 O43 Communication
 Co6 Alliance reward system
 S25 Senior executive support
 O44 Healthcheck / quality review
 Co7 Commercial cost
 S26 B2B Strategic alignment
 O45 Alliance charter
 Co8 Commercial benefit
 S27 Fit with strategic business path
 O46 Change management
 Co9 Process for negotiation
 S28 Other relationships with same partner
 O47 Operational metrics
 Co10 Expected Cost value ratio
 S29 Common strategic ground rules
 O48 Business to business
operational alignment
 S30 Common vision
Technical Dimension
 T11 Valuation of assets
 T12 Partner company market position
 T13 Host company market position
 T14 Market fit of proposed solution
Cultural Dimension
 O49 Exponential breakthroughs
 Cu31 Business to business trust
 O50 Internal alignment
 Cu32 Collaborative corporate mindset
 O51 Project plan
 Cu33 Collaboration skills
 O52 Issue escalation
 Cu34 Dedicated alliance manager
 T15 Product fit with partners offerings
 Cu35 Alliance centre of excellence
 T16 Identified mutual needs in the
relationship
 Cu36 Decision making process
 Cu37 Other cultural issues
 T17 Process for team problem solving
 Cu38 Business to Business cultural alignment
 T18 Shared Control
 T19 Partner accountability
Co
T
S
Cu
Op
=
=
=
=
=
Commercial
Technical
Strategic
Cultural
Operational
The Commercial dimension
Co1
 Co1 Business Value
Proposition (BVP)
O50
O49
 Co4 Alliance Audit
 Co5 Key metrics
 Co6 Alliance reward system
 Co7 Commercial cost
 Co8 Commercial benefit
 Co9 Process for negotiation
 Co10 Expected Cost value
ratio
Co2 Co3
Co4
Co5
90
O48
O47
O46
 Co2 Due Diligence
 Co3 Optimum Legal /
Business Structure
O51 O52100
Co6
Co7
Co8
80
70
60
O45
Co9
50
O44
Co10
40
O43
T11
30
O42
T12
20
O41
10
T13
O40
0
T14
O39
T15
Cu38
T16
Cu37
T17
Cu36
T18
Cu35
T19
Cu34
Cu33
Cu32
Cu31
S20
S21
S22
S23
S30
S29 S28
S26 S25
S27
S24
The Technical dimension
Co1
 T11 Valuation of assets
O50
O49
 T14 Market fit of proposed
solution
 T15 Product fit with partners
offerings
 T16 Identified mutual needs
in the relationship
 T17 Process for team problem
solving
 T18 Shared Control
 T19 Partner accountability
Co2 Co3
Co4
Co5
90
O48
O47
O46
 T12 Partner company market
position
 T13 Host company market
position
O51 O52100
Co6
Co7
Co8
80
70
60
O45
Co9
50
O44
Co10
40
O43
T11
30
O42
T12
20
O41
10
T13
O40
0
T14
O39
T15
Cu38
T16
Cu37
T17
Cu36
T18
Cu35
T19
Cu34
Cu33
Cu32
Cu31
S20
S21
S22
S23
S30
S29 S28
S26 S25
S27
S24
The Strategic Dimension
Co1
 S20 Shared objectives
O50
O49
 S22 Tactical and strategic risk
 S25 Senior executive support
 S26 B2B Strategic alignment
 S27 Fit with strategic
business path
 S28 Other relationships with
same partner
 S29 Common strategic
ground rules
 S30 Common vision
Co4
Co5
Co6
Co7
Co8
80
70
60
O45
 S23 Risk sharing
Co2 Co3
90
O48
O47
O46
 S21 Relationship Scope
 S24 Exit strategies
O51 O52100
Co9
50
O44
Co10
40
O43
T11
30
O42
T12
20
O41
10
T13
O40
0
T14
O39
T15
Cu38
T16
Cu37
T17
Cu36
T18
Cu35
T19
Cu34
Cu33
Cu32
Cu31
S20
S21
S22
S23
S30
S29 S28
S26 S25
S27
S24
The Cultural Dimension
Co1
 Cu31 Business to business
trust
O50
O49
 Cu34 Dedicated alliance
manager
 Cu35 Alliance centre of
excellence
 Cu36 Decision making
process
 Cu37 Other cultural issues
 Cu38 Business to Business
cultural alignment
Co2 Co3
Co4
Co5
90
O48
O47
O46
 Cu32 Collaborative corporate
mind-set
 Cu33 Collaboration skills
O51 O52100
Co6
Co7
Co8
80
70
60
O45
Co9
50
O44
Co10
40
O43
T11
30
O42
T12
20
O41
10
T13
O40
0
T14
O39
T15
Cu38
T16
Cu37
T17
Cu36
T18
Cu35
T19
Cu34
Cu33
Cu32
Cu31
S20
S21
S22
S23
S30
S29 S28
S26 S25
S27
S24
The Operational Dimension
Co1
 O39 Alliance process
O50
O49
 O40 Speed of progress so far
 O44 Health check / quality review
 O45 Alliance charter
 O46 Change management
 O47 Operational metrics
 O48 Business to business
operational alignment
 O49 Exponential breakthroughs
 O50 Internal alignment
 O51 Project plan
 O52 Issue escalation
Co4
Co5
Co6
Co7
Co8
80
70
60
O45
 O42 Formal business plan
Co2 Co3
90
O48
O47
O46
 O41 Distance from revenue
 O43 Communication
O51 O52100
Co9
50
O44
Co10
40
O43
T11
30
O42
T12
20
O41
10
T13
O40
0
T14
O39
T15
Cu38
T16
Cu37
T17
Cu36
T18
Cu35
T19
Cu34
Cu33
Cu32
Cu31
S20
S21
S22
S23
S30
S29 S28
S26 S25
S27
S24
Strategic Alliances are ‘Holistic’
Co1
 Which can you live without?
- Your heart or your brain?
- Your lungs or your blood?
 What happens if you have;
- Commercial and not
Cultural?
- Operational and not
Strategic?
 How do each of the
dimensions help each other?
 The answer of course is that
you need all the dimensions
in –
 An Alliance Balanced
Scorecard
O50
O51 O52100
O49
Co2 Co3
Co4
Co5
90
O48
O47
O46
Co6
Co7
Co8
80
70
60
O45
Co9
50
O44
Co10
40
O43
T11
30
O42
T12
20
O41
10
T13
O40
0
T14
O39
T15
Cu38
T16
Cu37
T17
Cu36
T18
Cu35
T19
Cu34
Cu33
Cu32
Cu31
S20
S21
S22
S23
S30
S29 S28
S26 S25
S27
S24
Why and how should we improve?
Co1
O50
O51 O52100
O49
Co5
Co6
Co7
Co8
80
70
60
O45
Co9
50
O44
Co10
40
O43
T11
30
O42
How can we improve our
scores nearer to best
practice?
Co4
90
O48
O47
O46
Why are there differences
in perception? Will this
hamper performance?
Co2 Co3
T12
20
O41
10
T13
O40
0
T14
O39
T15
Cu38
T16
Cu37
T17
Cu36
T18
Cu35
What would the
commercial impact of this
improvement be?
T19
Cu34
Cu33
Cu32
Cu31
S20
S21
S22
S23
S30
S29 S28
S26 S25
S27
S24
Red-Amber-Green (RAG) Dashboard
Co1
 Holistic and integrated
O50
O49
 Simple to understand
Co4
Co5
Co6
Co7
Co8
80
70
60
O45
 Reflects multiple dimensions
Co2 Co3
90
O48
O47
O46
 Provide striking insights
 Reflects both / all sides views
O51 O52100
Co9
50
O44
Co10
40
O43
T11
30
O42
T12
20
 Objective and numeric
O41
10
T13
 Rigorously researched
O40
0
T14
 Capable of action planning
 Capable of benchmarking
 Simple to operate
 Be capable of regular refresh
O39
T15
Cu38
T16
Cu37
T17
Cu36
T18
Cu35
T19
Cu34
Cu33
Cu32
Cu31
S20
S21
S22
S23
S30
S29 S28
S26 S25
S27
S24
A more complex (RAG) Dashboard
Co1
S20
T11
80
Co10
T19
60
45
S30
70
Co2
20
T18
20
Co8
42
30
27
20
O50
28
10
0
S23
O42
43
5
Cu37
0
S28
O41
50
40
10
5
0
0
60
O51
15
10
T13
10
10
O40
70
20
15
20
Cu32
25
S22
20
Co3
35
30
25
S29
30
30
Cu38
30
40
40
Co9
40
35
50
O39
80
O52
45
S21
40
T12
60
50
Cu31
50
50
80
70
Cu33
0
O49
O43
$6m
Co4
T17
T14
S27
Co7
S24
Cu36
O48
Cu34
O44
Co5
T16
T15
S26
O47
S25
O45
Cu35
Co6
O46
Co
Breakthrough Value
Proposition (BVP)
Alliance Audit
Key metrics
Alliance Reward System
Commercial Cost
Commercial Benefit
Process for Negotiation
Expected Cost Value Ratio
T
S
Cu
Valuation of Assets
Market Fit of Solution
Product Service Fit
Mutual Needs
Team Problem solving
Shared Control
Partner accountability
Shared objectives
Relationship Scope
Risk Identification
Risk sharing
Exit Strategies
Senior Exec Support
B2B Strategic Alignment
Other Relationships
Common Ground Rules
Common Vision
O
Alliance Process
Speed of Progress
Distance from Revenue
Formal Business Plan
Communication
Quarterly Healthcheck
MOUP
Change Management
Operational Metrics
B2B Operational Alignment
Exponential Breakthroughs
Internal Alignment
Relationship Plan
Trust
Collaborative Corporate
Mindset
Collaboration skills
Dedicated Alliance
Resources
Alliance Centre of
Excellence
Joint Decision Making
Process
Other Cultural Issues
B2B Cultural alignment
Co1
80
S20
Co10
70
T11
Co2
45
S30
70
50
T19
60
40
S29
20
68
Co8
Co4
20
O50
81
Cu37
O42
68
10
0
S23
Cu33
0
O49
S27
S24
Cu36
T16
T15
S26
Cu34
S25
O48
O44
O47
O45
Cu35
O46
Co
O43
T14
Co5
Co6
30
5
0
S28
O41
50
40
10
5
0
T17
Co7
66
T13
10
O51
15
10
97
T18
60
20
15
10
Cu32
25
S22
20
30
35
30
25
Co3
20
O40
70
40
Cu38
30
30
O39
80
O52
45
35
50
0
S21
40
T12
40
Co9
Cu31
50
50
80
60
T
S
Cu
O
$23m
An actionable framework
Contributors
Activities
Training
Influencers
Task
Common Success
Factors (CSFs)
Goal / Objective
Commercial
Alliance Success
Technical
The effectiveness with
which an alliance
achieves its primary
value-creating
activities. David C
Simon and Peter J
Lane – Journal of
International Business
Studies 2004
Stage
Resource Allocation
Leadership
Skills
Organisation
Control
Prioritisation
Relevance
??
Importance
??
This is a multiple interaction
I.e. many to many relationship
3
Strategic
2
Cultural
Operational
1
0
Outputs / Tools per stage
Resource
Mobilisation
Action
Planning
Diagnostic
Goal / Objective
Co1
RACI
S
O49
O48
O47
O46
R
O50
O51 O52100
Co5
Co6
Co7
Co8
70
60
O45
Co9
50
Co10
40
O43
T11
30
O42
H
Co4
80
O44
L
Co2 Co3
90
T12
20
O41
10
T13
O40
0
T14
O39
£/$/€
T15
Cu38
T16
Cu37
T17
Cu36
T18
Cu35
Cu34
Cu33
Cu32
Cu31
T19
S20
S21
S22
S30
S29 S28
S26 S25
S24
S23
S27
Impact x Number of Partners Contributing
3
2
1
0
Action plan overview (Example)
1
2
3
Identify Best Practice
Assess Reality of Results
Review Pilot
Understand Framework
Identify Gaps to Best Practice
Decide whether to scale
Get Coaching
Secure Internal Support
Decide new scope
Secure Internal Support
Secure Partner Support
Decide new team
Select Relationship/s
Construct (ST) Pilot
Construct (LT) Programme
Secure Partner Support
Secure Resources
Secure Resources
Conduct Diagnostic
Launch (ST) Pilot
Launch (LT) Programme
MEDIUM
30 - 90
LONG
90 - 360
SHORT
0 - 30
ABP Case Studies in High Tech (Sample)
Average increase in the database is 250% - 650%
Target
Increase
Client
Target
Increase
IBM
$19m
$51.3m
Chordiant
IBM
$16m
$80m
Unisys
Lenovo
$4m
$6m
Capgemini
HP
€34m
€61.2m
Capgemini
Microsoft
$230m
$782m
Capgemini
Oracle
$18m
$82.8m
Cognos
IBM
$23m
$69m
Siebel
IBM
$900m
$1044m
Cognos
IBM
€12m
€42m
Unisys
EMC
€13m
€18.59m
Oracle
IBM
€6m
€22.8m
BT
Fujitsu
£12m
£15.24m
BT
8 Partners
£150m
£480m
SAP
32 Partners
€65m
€152m
Micro Focus
Accenture
£3.5m
£17.01m
HP
StorageTek
£26m
£41.6m
Siemens AG
PwC
€4m
€16.2m
BT
Cisco
£5m
£30m
APC
IBM
$3m
$7.98m
Alcatel
BT
£4m
£7.6m
Client
Partner
Capgemini
Total
454.5m 1494.29m
Total
Partner
1438m 1975.53m
Further Details
For further details please contact;
Mike Nevin
Managing Partner
Alliance Best Practice Ltd
Web: www.alliancebestpractice.com
Office: +44 (0)1675 442490
Mobile: +44 (0)7766 752350
E Mail: mike.nevin@alliancebestpractice.com