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The Business Case SolutionT for Alliances & Partners

Experience shows that business alliances usually succeed or fail depending on the partners' ability to address some hard questions before starting off together.

Before launching an alliance or joint venture, potential partners should be asking and answering questions such as these:

• Strategic Fit
  How do you know that 1 + 1 equals more than 2 in the eyes of the market?
  Do you have a competitive strategy for the alliance as a whole?
  Where do the partners complement each others' strengths?
  Where are the potential conflicts of interest?
• Alliance Governance
  Who is responsible for each part of the joint operation?
  Are all the pieces under control?
  How is management control exercised?
  Are all the partners fully committed?
• Metrics (measurement)
  Which measures of operational performance need to be  tracked?
  What are early indicators that business performance is or is not on course?
  Is there a good business model in store for all partners?
  Do the partners share costs and risks evenly? 

Three Points of View

Answering these questions with confidence calls for careful thinking from at least three points of view:

• The overall alliance or partnership. This is the "face" seen by customers, by the market, and by the competition.
• Each member of the alliance, or each partner. Each needs to be sure of gains from the proposed alliance (or proposed alliance product, service, or solution).

Alliance planning brings at least three interacting business models to the table. Each needs to promise profits and a healthy business. Each has to be tested with a rigorous risk and sensitivity analysis. The assumptions and practical realities behind each business model also have to be questioned and tested. Resource requirements should be assessed realistically, resource limits should be acknowledged, and resource responsibilities should be spelled out and owned.

All of these needs can make the business planning challenges seem hopelessly complex, especially if the proposed alliance or alliance solution is new. There is, however, a fast and cost-effective solution.

The Business Case Solution for Alliances and Partners

Since 1994, Solution Matrix Ltd. has helped dozens of companies develop solid answers to the questions above with a case building project called "The Business Case Solution for Alliances and Partners.™  The project is designed with methods that have been "battle hardened" in shaping some of the world's most formidable and successful business alliances (please click here for more information on our clients).

Working with you and your partners, we lead you to identify the most important questions to ask, deal with competitive and confidentiality issues that can threaten the relationship, and project business results for the alliance and for each partner.  

The heart of the The Business Case Solution for Alliances and Partners is a structured, collaborative  workshop, led by Solution Matrix consultants. The workshop is normally scheduled for 3 consecutive business days at one or more of the partner sites. 

For more information about the Business Case Solution for Alliances and Partners, or to request a formal proposal, please contact Solution Matrix Ltd.

The Business Case Solution for Alliances and Partners Complete workshop and case building project management.  Pre-workshop planning and industry analysis Selection of the case-building team for the workshop (ideally representing all potential partners). Recruitment of an Alliance Advisory Group. Specification of alliance products and services, as seen by customers, competitors and the markets. This analysis defines what the customer sees on the market and how the alliance solution competes with similar solutions on the market.   Specification of each partner's contributions. This analysis asks: "What does each partner contribute to development, manufacturing, delivery, marketing, sales, support, and warranty? Is everything covered? Three or more interrelated business models: one for each partner and one for the alliance. Business models show how each partner makes money and how the partners share risks and costs. Supportable sales forecasts. Sales forecasts in the alliance case must be realistic.  This analysis describes the alliance's ability to sell, deliver, and support what is forecast, in concrete terms. Pro forma income statements looking forward 3 years for each partner and for the alliance. The models are implemented and delivered in MS Excel format for continuing alliance management and control. Rigorous risk and sensitivity analysis of the business models and income projections, including: Confidence interval estimates for projected sales and profits. Important contingencies that must be managed to target levels by each partner (critical success factors). Major risk factors and their probabilities. A comprehensive alliance business case report, summarizing and interpreting the above analyses. The report is delivered in MS Word and MS Excel format for continuing use in alliance governance and measurement. An alliance business case presentation, designed for board-level review. The presentation is implemented and delivered in MS Powerpoint format.   Typical calender time:              1 week planning and background reserach             1 week onsite interviews, including 3-day collaborative workshop with partners               1 week follow up research, analysis, and final presentation                  Total: 3 weeks   Project leaders:             Two senior solution Matrix Ltd. consultants with 20+ years              combined business planning and business case experience For more information about the Business Case Solution for Alliances and Partners, or to request a formal proposal, please contact Solution Matrix Ltd.

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