What we have learned from chapters

Yashu
Week1-Chapter11.pdf

MADS 6628

BUILDING STRATEGIC PARTNERSHIPS

 Introduction

 Expectation – Course Syllabus

 Continuously learning

 Group Projects

 Individual Paper

Agenda – Week 1

The Collaboration Challenge

Textbook

for MADS

6628

Chapter 1

The Strategic Benefits of Alliances

 21st century – The age of alliances

 Collaboration between NPO/NGO and FPOs (for profit

organizations) will evolve from:

Philanthropic arrangements

 zero sum

 donor -> recipient

 1 – 1 = 0

Chapter 1

The Strategic Benefits of Alliances

 21st century – The age of alliances

 Collaboration between NPO/NGO and FPOs (for profit

organizations) will evolve to:

 Strategic Alliances

plus sum

win / win

1 + 1 = 2

Benefits of Strategic Alliances

 United Negro College Fund

(NGO that runs education programs for minorities)

 Receives funds for scholarships for African American

science students

 Decreases systemic discrimination

Pharmaceutical multinational corporation

 Excellent form of employee recruitment

 Satisfies equity hiring legislation

Drivers of Strategic Alliances

1.Natural Strategic Fit

Mutual interests

Objective: Increase pet survival / health Objective: Sell pet products

Objective: to increase

pet adoptions

I.e. Free adoptions for 55+

What benefits could drive such a strategic alliance?

Drivers of Strategic Alliances

1.Natural Strategic Fit

Mutual interests

Objective: Increase pet survival / health Objective: Sell pet products

• Increase market share

(more pets to feed!)

• Customer loyalty

• HR retention

What benefits could drive such a strategic alliance?

• Awareness of the cause

• Find more permanent pet homes (save

more pets)

• Gain volunteers (Purina employees)

Drivers of Strategic Alliances

2.Unatural Strategic Fit

Different Interests  Unexpected synergies can result when you embrace your enemies

and Find Common Ground (rather than remain competitive rivals)

Objective: Forest conservation Objective: Sell forest products

What kind of strategic alliance could be created between them?

Drivers of Strategic Alliances

2.Unatural Strategic Fit

Objective: Forest conservation Objective: Sell forest products

Objective: to protect and

manage North Carolina

Wetlands

What benefits could drive such a strategic alliance?

Drivers of Strategic Alliances

2.Unatural Strategic Fit

Objective: Forest conservation Objective: Sell forest products

• Conserve one forest at a time

• Awareness of the cause

• NGO awareness building

• Potential volunteer base

What benefits could drive such a strategic alliance?

• Improved reputation

• Brand building

• Investor confidence

• HR retention • Customer retention

Drivers of Strategic Alliances

2.Unatural Strategic Fit

 Group Exercise:

1. Describe a strategic alliance that could result from such an unnatural

fit

2. Identify potential benefits for each partner.

Mothers Against Drug Driving

Objective: Decrease impaired driving

Molson’s Brewery Objective: Sell alcohol (beer)

Drivers of Strategic Alliances

3. Serendipity

Good quality

coffee! Nice

place…

They are just

getting started…

Hope they

survive…

Hey…. I wonder if

they would help us

fight global

poverty in

exchange for

some exposure?

Chance , kismet / destiny, or karma

Macro-level Forces Driving Cross-

Sector Collaboration

Political forces:  De-evolution / shifting of responsibility from state-run to society-based problem

solving

 I.e. Obama appealing to corporations to help bail the USA out of the recession

/ depression

Economic forces:  National debt and deficit realities have forced the government to slash

NGO/NPO funding – leading NGOs to seek out other funding sources

Macro-level Forces Driving

Cross-sector Collaboration

Social forces:

 Individuals & social welfare groups pressuring corporations to increase

CSR initiatives

 Intelligent consumers are no longer satisfied with low prices or product

quality: They demand fair / equitable business practices. I.e. The Gap

Macro-level Forces Driving

Cross-sector Collaboration

Social forces:

Gave rise to:

Reporting of CSR activities

Indian 'slave' children found making low-

cost clothes destined for Gap New Delhi - The Observer, Saturday 27 October 2007

http://www.gapincsustainability.com/people

Macro-level Forces Driving

Cross-sector Collaboration

Social forces:

The garment-factory collapse in Savar,

Bangladesh April 2013.

 Gave rise to poor press. I.e. :

 H&M Responds Slowly to Bangladesh Factory Collapse Killing

1,100

 http://corpwatch.org/article.php?id=15840

Macro-level Forces Driving

Cross-sector Collaboration

Social forces:

One month later– another collapse of a H&M factory

in Phnom Penh Cambodia….

Gave rise to Headlines: H&M Clothes Made in Collapsed Cambodian Factory

How does a corporation recover its reputation after

two such disasters in a row?

Benefits of Collaborating

for NGOs

Cost-savings  Austerity alliances

 Funding cuts dictate the need for NGOs to reduce duplication of overhead

costs (rent, administration) and economize on scarce resources

Economy of Scale and scope  Increased volume = purchasing discounts and buying power

 Shared distribution systems = new markets

 Increased sphere of impact and ability to offer “one stop shopping”

Benefits of Collaborating

for NGOs

Synergies

 Complementary capabilities (1 + 1 = 3)

 Inescapable interdependence

 No single entity has all of the required inputs or resources

 Critical mass

 Together, partners can assemble the requisite resources to succeed

Revenue Enhancement

 Source of funding / income

Benefits of Collaborating

for Corporations

Strategy enrichment

 Supporting the local community provides:

 potential long term markets (revenue)

 loyal consumers

Strategic Human Resource management

 Community involvement and volunteer programs

help to:

 attract and retain loyal employees

 align employees with deeper values (of the organization)

Benefits of Collaborating

for Corporations

Culture building

 Fosters organizational culture of empathy, relationship building

Business generation

 Provides long-term linkages and networks

Textbook Key Elements of Strategic

Alliance Creation and Development

Chapter 2. Understand nature of collaboration and its

various stages (collaboration continuum)

Chapter 3. Make the connection through the alliance

marketplace

Chapter 4. Ensure strategic fit

Chapter 5. Generate and measure value / shared

benefit

Chapter 6. Manage / sustain the relationships