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
Drivers of Strategic Alliances
3. Serendipity
Objective: Defend dignity and end poverty
Objective: Sell premium coffee products and create a niche
Objective: to ensure Fair Trade practices in coffee bean supply
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
