The Biopharma Council of ASAP has signed on as a sponsor of our growing study of the practice of alliance management in biopharma.

To paraphrase the title of one of the sessions at last month’s ASAP Global Summit, alliance management in biopharmaceuticals is no longer a luxury, it has become a necessity as more and more companies adopt partnering as a pillar of their strategy.

The study is asking and answering key questions about how alliance management is organizing (an early read of data already collected says it is becoming more and more global) and the work alliance managers are doing.

Read the press release and overview for more information. If you’d like to participate, please send an email to info@rhythmofbusiness.com and we’ll send you a link to the survey instrument.

I’m missing something here. Ernst & Young just released their annual report on the pharmaceutical industry, Progressions – Pharma 3.0 (2010). Their comprehensive study’s message is that “Successful firms will build a core competency in learning how to attach their unique assets and attributes to the changing business models of nontraditional players in complex and dynamic collaborations.” However, what is of concern is a statement from the press release, “Despite near universal agreement among pharmaceutical industry executives that nontraditional companies will help reshape the healthcare marketplace, most feel unprepared to address the challenges these new creative alliances will bring.” Unfortunately, what is not mentioned in either the report or the press release is why these executives feel unprepared.

Perhaps there is a hint of what’s causing this angst in an IBM research report issued in March 2006. In its Global CEO Study – Expanding the Innovation Horizon – the principal conclusion was that “CEOs believe collaboration is absolutely critical, but there is a problem: Although collaborative aspirations were high, actual implementation was dramatically lower. Citing a lack of the skills and expertise needed to partner externally, many CEOs refer to partnering as ‘theoretically easy’ but ‘practically hard to do.’”

I realize that these reports offer a strategic look at business model innovation and, as such, aren’t intended to delve into the operational challenges to successfully building the collaborative relationships upon which the resulting models depend. Nevertheless, what I find surprising is that the executives interviewed in both studies – four years apart – apparently either fail to recognize or skirt the reality that managing across the boundaries of “complex and dynamic collaborations” requires a different way of managing, just as they represent changing business models.

What bothers me is that there seems to be a disconnection between words and actions. If CEOs are unprepared for this new world, what IS being done to prepare? The Third State of Alliance Management Study (2009) from the Association of Strategic Alliance Professionals (ASAP), reports that investments in alliance management are stable. It would seem to me that because alliances are a type of collaborative network, alliance professionals should have a leg up on easing the feeling of unpreparedness in organizations today. Investment in collaborative skills and managing networks should be increasing. We have some evidence it is – the number of new people at the ASAP Global Summit earlier this month; some increasing press interest in alliances and alliance management; and (shameless self-promotion warning) even an increase in the number of people asking The Rhythm of Business for help in developing an alliance management capability. My concern is that it isn’t enough to bridge the knowledge and experience gap.

In addition, while managing a two party alliance and the boundary crossing that entails provides a basis in managing dynamic collaborative networks, it is just that, a basis. The business models Ernst & Young believes will reshape the healthcare marketplace will require innovating alliance management to manage the network. That is, network managers have to become ever more like choreographers or orchestrators, designing the networks, crafting value propositions that make sense for the network overall, shaping the economic opportunity so that necessary players will participate, and facilitating the appropriate level of collaboration to realize the network’s purpose. (For more on the role of the network choreographer, see our white paper, Collaborative Networks Are the Organization.)

Thus, my questions to alliance management professionals, especially those in the biopharmaceutical industries, are simple: “What are you doing to help your organization meet the challenges collaborative business models present? What are you doing to innovate yourself?

 Contact me to participate in the Practice of Alliance Management in the Biopharma Industries Studies, sponsored by Ipsen, Astellas, and the ASAP BioPharma Council.

Shameless Self-Promotion for Alliance Managers is a hit! At the Association of Strategic Alliance Professionals (ASAP) Global Summit, I took a gamble that alliance managers are eager to define a leading role in networked organizations that depend on alliances for a goodly chunk of their revenue. And it worked! We had an overflow crowd of very active and engaged participants who crafted an elevator speech defining their job and the value they create.

Alliances and collaborations are increasingly central to business models. Alliance professionals are the keepers of the expertise for making them work and deliver the value intended. The Summit theme of “Where Tomorrow Meets Today” (it was held at Disneyland, after all) provided a great platform to have conversations about what the profession of alliance management and its association, ASAP, must do to advance the use of alliances to achieve growth and innovation and to embrace alliance management as a distinct management discipline, such as marketing and product development.

 Some of the highlights of the Summit for me include:

•  Tom Koulopoulos’ keynote Alliances in the Innovation Zone urged us to take head-on the challenges of transforming organizations to succeed in today’s competitive environment
• The Collaborative Innovation Council tackled the role of alliance professionals in leading innovation of products, processes, business models – and the resulting innovation in management required to succeed
• The Biopharm Council debated the necessity of an alliance management function when the need to collaborate effectively has become part of nearly every one’s job within the industry
• Four very generous executive coaches offered insights intended to help Summit participants breakthrough to the next level of their careers
• Recognition of Novartis’ Malaria Initiative, a cross-sector collaborative network that has saved 750,000 lives with an Alliance Excellence Award

The energy and passion for collaboration as a way of working is always over the top when alliance professionals get together. With at least 15 countries and a who’s who list of major corporations represented, the Summit was at once both a celebration and a call to action. A celebration that alliances and networked business models are essential to strategy. A call to action to ensure the alliance professional’s expertise is valued and called upon to lead today’s organizations into tomorrow.

Speaking at the 1^st Global Peter Drucker Forum in Vienna was a great experience. Focused on The Future of Management, the presentations and discussions were energizing and thought provoking. The principle theme in all the discussions was that to realize the growth 21^st Century companies desire, organizations are becoming adaptive networks with evolving business models and strategies.

I came away from the Forum with affirmation that there is broad agreement the collaborative future is here…and we can no longer put off ensuring our organizations are ready for it. As Drucker prophesized in 2000, innovation is occurring in the very definition of the organization, its boundaries, and how it interacts with its stakeholders and communities. The Forum speakers and participants spent many hours discussing how, to be successful, the organization must innovate everything about itself, starting with how it’s structured and managed.

Keynote speakers at the Forum talked about what they learned from Drucker that is helping them understand the future of management and the organization. Professor Yves Doz stressed that strategic agility results from the interplay between a set of dynamic capabilities along the dimensions of strategic sensitivity, resource allocation fluidity, and leadership unity. And Professor C.K. Prahalad focused on the importance of seeing new organizational patterns in the data that is available to all.

Based on the practical experiences The Rhythm of Business has had over the past decade with collaborative networks, Professors Doz and Prahalad hit upon the right elements. My learning from Drucker is to take complex topics and state them simply. So I think of the future manager – what today’s manager must be – as a choreographer, rallying people and partners, their capabilities, and their resources around a strategic vision driven by the customer. And the organization that choreographer must lead is a collaborative network, the dynamic collection of businesses, individuals and other organizational entities that possess the capabilities and resources needed to achieve a specific outcome. As Prahalad points out, seeing the patterns in data and understanding what it means is essential for creating value for the organization, those that bring it capabilities and resources, and of course, for the customer.

Nevertheless, it is also clear to me that leading management thinkers are struggling with the implications and challenges of this transformation to collaborative network business models. I found this surprising given that the expertise organizations need to implement networked business models and collaboration dependent strategies resides in alliance management. That is, alliance professionals have a leg up on figuring this out since managing collaborative networks is what they do. However, what concerns me is that the discipline of alliance management hasn’t been able to get on the radar screen of senior leadership.

In all my years of working in alliances and with alliance professionals I fail to understand why this is the case. I’m looking forward to the upcoming Association of Strategic Alliance Professionals Global Summit where the Collaborative Innovation Council will tackle this question — When innovation is collaborative and done in networks, what is the role alliance managers should play in innovating how their organization is managed?

We’ve just launched a global research study, The Practice of Alliance Management in Biopharma Industries. The study is sponsored by Ipsen www.ipsen.com and Astellas www.us.astellas.com. Please see our press release to learn more about participating and/or sponsoring the study. http://www.rhythmofbusiness.com/news.php?id=5

I’m getting ready to head to Vienna Austria to present at the 1^st Global Peter Drucker Forum, celebrating what would have been his 100^th birthday, and I am thrilled.

My admiration for Peter Drucker began years ago as a doctoral student in management, and continues to this day. So, naturally Jan and I were excited to have the great privilege of meeting and speaking on the stage with Peter Drucker at the Delphi Group’s Collaborative Commerce Summit in June 2001 and then again in 2002. What always separated Professor Drucker from the rest of the business thinkers was his ability to present complex ideas in simple, easy to understand terms. He just made sense.

So you can imagine how pleased we were when our paper – Collaborative Networks are the Organization: An Innovation in Organization Design and Management– was accepted for presentation at the Drucker Forum. The paper describes our perspective on how one of Drucker’s most important prognostications is coming to be:

 “The corporation as we know it is unlikely to survive the next 25 years.

Legally and financially, yes. But not structurally and economically.”

In describing the event it is organizing, The Drucker Society of Austria, said: “In the spirit of Peter Drucker, the Conference will place the emphasis on the total societal and cultural context in which management should be seen. It will integrate elements such as the intellectual currents and humanistic thread in Peter Drucker’s thinking, the holistic view on management and the importance of Peter Drucker’s work for future generations. It will create a common platform for a dialogue between managers, Business School and University professors, economists, consultants and other interested parties to discuss the future of management in the light of Peter Drucker’s work.”

Drucker’s prognostication foretold a significant challenge that is upon corporate management and paints the appropriate backdrop to the overarching question for Conference participants, “In today’s increasingly complex and crisis-ridden world, can we expect help from Peter Drucker’s thinking in coping with the challenges for 21st century management, in particular with regard to its role, its legitimacy, and its responsibility?”

Please share with us how you would answer the question. Upon my return I will share a synopsis of the Forum.

What role is Alliance Management going to play in innovating how the organization is managed? This question is increasingly important as more and more organizations are adopting collaborative business models and strategies. Is its focus only going to remain on the tactical management of alliances, primarily between a company and specific partners or is it going to step up its game and take its rightful place at the CEO’s table?

It is clear from the many conversations we’ve been having with alliance managers (primarily in biopharma industries) that the profession of alliance management is at a crossroad. Some alliance managers believe that their focus should remain strictly on the alliance partner and the internal alliance team. At the same time, there are an increasing number of alliance managers who believe that path will lead to the marginalization of the profession. As more and more managers across the organization rely on various “partners” to get their job done, everyone needs collaborative ability so the need for dedicated alliance managers is reduced – or so goes this line of reasoning.

 At the same time, we are hearing from an increasing number of alliance managers who are getting involved in a number of new endeavors – supporting managers who have responsibility for outsourced providers, or taking a lead role in integrating acquisitions, for example. About two years ago, we wrote a paper, Collaborative Network Management: An Emerging Role for Alliance Management in which we discussed applying key alliance management principles to other relationships, especially those upon whom the alliance depends for success. These include contract manufacturers, research organizations, distribution and logistics providers, among others. This is essentially a grass roots approach to evolving the management of the organization to apply some of the governance, processes, and tools that can best support collaborative relationships. 

We are convinced a bottoms-up approach is no longer sufficient. When the business model and strategy of an organization depend on collaboration, senior leadership – the guys and gals that sit at the CEO’s table – must acknowledge that working collaboratively requires a different management approach than that which worked within more self-contained models. Alliance management has expertise in leading and managing networked organizations. It is the only discipline within an organization that can serve as the CEO’s right hand: speeding decision making, breaking down barriers, overcoming the partisan bickering that can undermine collaboration.  Now is the time for the profession to think more broadly about its role, clearly demonstrate to senior executives the value alliance management brings, and get on with the business of innovating management for today’s collaborative business models. 

What do you think? Please share your thoughts on this important question.

At a few conferences we’ve spoken at lately, we’ve been asked, “What are the skills of collaboration?” This is a great question, because we’re also seeing collaboration appear on the lists of competencies employees are expected to develop as they progress in an organization. Collaboration isn’t a skill. It isn’t teamwork and it isn’t a technology. It’s a purposeful way of working intended to gain access to and leverage valuable resources in pursuit of objectives. And that’s the real power – the ability to access and utilize the knowledge, expertise, relationships, and other resources of people in ways that benefit and help achieve the objectives of all concerned.

We’ve just written a new article that introduces three principles of collaboration and defines ten competencies required to work collaboratively. Let us know what you think. Do you agree with us? Over the summer, we taught this way of thinking and acting in several executive education programs and management workshops. Our Collaborating to Win™ Assessment provides a powerful metric to use to guide your efforts. If your organization needs to improve its way of working, we can customize a program for you.

As we listened to Barack Obama’s speech to the United Nations General Assembly it was clear achieving the four pillars he believes are “fundamental to the future that we want for our children: non-proliferation and disarmament; the promotion of peace and security; the preservation of our planet; and a global economy that advances opportunity for all people,” require a significant level of global collaboration. And, if you will, it sounded as if he was lobbying for an additional job title, Global Collaborator-in-Chief.

Clearly, Obama appreciates the need for collaboration between and among nations, “it is my deeply held belief that in the year 2009 — more than at any point in human history — the interests of nations and peoples are shared…and now is the time for all of us to take our share of responsibility for a global response to global challenges.” Make no mistake about it; Obama is spot on in recognizing that these are complex challenges requiring complex solutions. Solutions rooted in global collaboration. Despite the obvious problems to be dealt with in getting each national government to understand that it is in its individual interests to help others be successful, reaching such commonality is not without precedent.

Last night at an ASAP New England Chapter event, Brian Clark of Progress Software opened his presentation on “Coopetition” and Strategic Alliances with a famous picture of Churchill, Stalin and Roosevelt. He asked what the three had in common. Yes, they had a common enemy, but Brian also pointed out that they had in common their differences – different views of their role in the world, different ideologies, etc.

While finding commonality in the differences among nations is absolutely necessary, it is not sufficient. Achieving Obama’s four pillars requires cross-sector collaboration as well. That is, in addition to governments, these challenges require collaboration with business, academia, and NGO sectors of the global economy. Bridging these sectors increases the complexity of the solution.

Fortunately, we’re not starting with a clean sheet of paper. There are several models to study, including the William J. Clinton Foundation http://www.clintonfoundation.com, the Bill & Melinda Gates Foundation http://www.gatesfoundation.org, and The Alliance for Climate Protection http://www.climateprotect.org, to name a few. Although each is different and don’t encompass all of the stakeholders Obama’s pillars would embrace, they nevertheless provide examples to learn what works and what doesn’t in pursuit of cross-sector global collaboration.

Barack Obama, the Global Collaborator-in-Chief, has challenged the United Nations General Assembly – and by extension every sector of society – to open a new era of partnership and collaboration to build his four pillars. The understanding developed by the alliance management profession of how to succeed in collaborative work is a tremendous asset to be put to use in developing the complex solutions required.

It hard to miss the continuous stream of merger and acquisition announcements in the headlines lately. Whether it’s Dell buying Perot Systems, Pfizer buying Wyeth, Amazon.com buying Zappos.com, or EMC buying Data Domain, the pace of acquisitions has once again quickened. Apparently, companies are finding it easier to raise the millions or billions of dollars needed to finance their shopping spree.

As is always the case, the requisite press releases tout all the synergies that will be realized by making this or that acquisition. Unfortunately, the business landscape is littered with failed acquisitions. The reality is that most acquisitions and mergers fail. So, despite all the chest pounding and rosy press announcements about the gains that consolidation and economies of scale will bring, the majority of acquisitions across all industry sectors do not live up to their promises.

Let me be clear, I’m not against purposeful, strategic acquisitions. Quite the contrary. If carefully thought through and the rose colored glasses are tucked away, a well timed and carefully planned acquisition can provide significant benefit for all stakeholders. However, what concerns me is the very real challenge companies face integrating the acquired company into its going forward operations. Study after study of both successful and failed acquisitions show that to get it right, senior management must pay particular attention to integrating two cultures, communicating continuously, and building trust and transparency.

What’s interesting is that many companies have the expertise needed to get acquisition integration right – they just aren’t using it for that purpose – yet. Alliance managers are uniquely suited to guide their organizations through the challenging integration process. No other function in an organization has it as its charge to overcome organizational differences and get two companies to work as one. That is their job.

The opportunity for alliance management is to seize this immediate business need and to catapult into the strategic imperative of successfully integrating acquisitions. As the pace of acquisitions once again quickens, those who are skilled at bridging silos, connecting the right people, and avoiding implementation failures have an important new role to take on.