Discussion: Ideal Alliance Partners
In thinking about ideal alliance partners, Microsoft and Apple may not immediately spring to mind. But in fact, these often fierce competitors have a surprising history of collaboration; take for example, Office for Mac 2011. Working with, rather than against Apple, “Microsoft has once again made the Mac OS X version of its world-dominant productivity suite jive a lot more closely with the latest Windows version” (Hiner, 2010).
In “Finding the Ideal Partner,” Kwicien (2012) asserts that many organizations can grow only by forming business alliances. HR executives are increasingly being called upon to find suitable alliance partners. When considering potential alliance candidates, Kwicien emphasizes the need to think originally, or “outside the box.” He provides seven characteristics of the ideal alliance partner. One way for HR to encourage original thinking would be to ask the C-suite to consider new factors not previously considered when evaluating potential alliance partners. Drawing on the Required Resources and your own additional research, suggest three other plausible ways for HR to facilitate new ways of thinking about potential alliance partners.
Do you see any risk for the HR department in leading the charge of thinking outside the box in this regard? From a risk versus reward perspective, how might the HR department fail the organization by selecting non-traditional candidates?
Reference:
Hiner, J., (2010). The 10 greatest moments of Microsoft-Apple collaboration. ZDNet. Retrieved from http://www.zdnet.com/blog/btl/the-10-greatest-moments-of-microsoft-apple-collaboration/41106
To prepare for this Discussion,
Review this week’s Learning Resources, especially:
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- https://www.amanet.org/articles/the-right-way-to-make-alliances-work/
- Finding the ideal partner:– See pdf
- Build Versus Buy in the Current– See pdf
- Managing business processes – See pdf
Assignment:
Respond to two of your colleagues’ postings in one or more of the following ways:
- Ask a probing question.
- Share an insight from having read your colleagues’ postings.
- Offer and support an opinion.
- Validate an idea with your own experience.
- Make a suggestion.
- Expand on your colleagues’ postings.
- No Plagiarism
- APA Citing
1st Colleague – Natasha Mills
Ideal Alliance Partners
Week 4 Discussion
The primary objective for businesses to get into partnerships usually is to create more value than either partner can create when operating individually. The achievement of this objective is only possible if an organization selects the right partner. Kwicien (2012) identifies a list of characteristics for organizations to look for in potential partners. This paper relies on the list to identify more characteristics HR executives should seek in a potential partner. Further, the paper uses the identified characteristics to examine examples of business partnerships that proved successful or failed, as well as the need for original thinking by HR professionals.
Successful Partnership Example
The characteristics Kwicien (2012) recommends organizations to look for in potential partners include shared vision, carrier relationships, synergistic services or products, complementary 1stbusiness model, corporate culture, and management style. The partnership between Ford Motor Company and Domino’s Pizza in 2017 was ideal in light of the characteristics of an ideal alliance. Elements such as a shared vision, carrier relationships, synergistic products and services, compatible technological capabilities, and new sales markets and channels were present. Hence, it was unlikely for the partnership to fail.
Partnership that Appeared Ideal but Failed
The partnership between Kraft-Heinz and Starbucks appeared ideal. It is logical to argue that the partnership was ideal since it worked successfully for 12 years, after which it failed. The partnership had most of the characteristics of an ideal alliance, such as synergistic products and services, complementary domain expertise, and new sales channels and markets. It is also possible to assume that the partners had a compatible management style given the years the two enterprises managed to work together However, it is difficult to determine whether the partners had a shared vision. This is because the partnership began falling apart when Starbucks decided to opt out of the partnership agreement when it realized it was lurking behind competitors due to the lack of flexibility in the agreement (Shonk, 2022). From this perspective, the alliance was not founded on a shared vision, making it unfavorable for one partner, especially with changes in the business environment of the unfavored partner. As a result, the partnership ended after 12 years of doing business together.
Lesson for HR Executives from Successful Less-than-ideal Partnerships
Less-than-ideal partnerships can succeed. Many businesses get into partnerships without checking off all the seven characteristics identified. The motives and risks involved, as well as the competitive advantage each partner gains, present enough reasons for most businesses to get into partnerships. The success of such partnerships often stems from the willingness of both partners to collaborate and trust each other, particularly with ongoing changes in the business environment. According to Moen et al. (2010), successful partnerships are characterized by partners who are able to work closely and identify capabilities to be integrated into their operations. Hence, the lesson for HR professionals is that potential partnership candidates do not have to possess all the characteristics Kwicien (2012) has listed. Rather, they should think beyond these characteristics and be on the lookout for other capabilities to be explored in their partners.
Ways for HR to Facilitate Original Thinking in Searching for Alliance Partners
It is evident that Kwicien’s (2012) list of characteristics of ideal alliance candidates is not exhaustive, calling for HR professionals to think outside the box. One way for HR to achieve this is to consider a renegotiation period. The Kraft-Heinz and Starbucks partnership illuminates this recommendation significantly because the partnership was doing well until it became inflexible for one party, leading to its disastrous end. Another way for HR professionals to facilitate original thinking is to examine the history of the potential partners in terms of alliances, to objectively determine the probability of the partnership being a success. Lastly, HR should identify the level of control they want their organization to have in the partnership to avoid potential conflict with the partners in future. These factors facilitate “out of the box” thinking because they are not included in the list of characteristics to look out for in potential partners.
Justification of the Use of a Limited HR Budget and Possible Negative Consequences of Encouraging Original Thinking
Partnerships have the potential to succeed or fail. Therefore, it is advisable to not invest a lot of money in pursuing candidates for alliances, especially because even ideal partners lead to failed alliances. HR budget for “outside the box” alliance partners should even be more limited. This is because this strategy is a trial and error one, as opposed to that proposed by Kwicien (2012) that can be described as evidence-based. This trial-and-error aspect comes with uncertainty, which can lead to the negative consequence of failure. At the same time, it may cause HR to miss out on ideal alliance partners that can help the organization create more value than the chosen alliances.
In conclusion, the determination of ideal alliance partners is a sophisticated process because it requires a balance between tried and tested methods, as well as original thinking. This balance can give HR professionals objectivity during the process, leading to successful partnerships.
Kwicien, J. (2012). Finding the ideal partner. Employee Benefit Adviser; New York 10 (2), 44.
Moen, Ø., Bakås, O., Bolstad, A., & Pedersen, V. (2010). International market expansion strategies for high-tech firms: partnership selection criteria for forming strategic alliances. International Journal of Business and Management, 5(1), 20.
Shonk, K. (2022, May 8). Negotiation in business: Starbucks and Kraft’s coffee conflict. PON – Program on Negotiation at Harvard Law School. https://www.pon.harvard.edu/daily/business-negotiations/the-starbucks-kraft-dispute-in-business-negotiations-prepare-for-problems/
2nd Colleague –
Sandra Patterson
RE: Discussion – Week 4
Week 4: Ideal Alliance Partners
Describe a successful partnership that you found in your research.
In my research, I found that the main characteristic of a successful partnership is to be able to implement a joint venture of partnerships. Also, a successful partnership needs to have a mutually beneficial relationship and the two companies need to be able to complement each other. For example, Apple and IBM have been able to bring together the analytics and enterprise-scale computing of IBM along with the elegant user experience of the iPhone and iPad to deliver a new level of value for businesses. Apple already had a background in knowing how to give customers what they want, and they could also improve IBM’s image. In addition, IBM’s big data and software gave Apple a big boost.
Cite an example of a partnership that initially appeared to be ideal, but failed and describe how it progressed
Partnerships that failed were between the Dutch oil company Shell and the Danish toy company Lego. They had a branding partnership that seemed alright. In addition, Lego even stamped some authenticity on its race cars and gas station sets. Then Shell was able to connect with customers from the start. So for decades, the partnership worked well, but as Lego toys emerged from the basement and became a global children’s entertainment brand, Greenpeace saw that it wasn’t right for children to play with toys that displayed the name of a petroleum company that had a history of questionable environmental practices. So Greenpeace released a YouTube video that criticized the partnership by enveloping a Lego arctic with thick crude oil, all to a melancholy rendition of the Lego Movie, “Everything is awesome”. The public outcry from concerned citizens and parents was quick and in 2011 the Shell-Lego partnership ended (Kosin, M., n.d.).
Suggest three ways for HR to facilitate original thinking in searching for alliance partners
The three ways that HR can facilitate original thinking when searching for alliance partners are having trust between management teams, the relatedness of partner business, and having access to links to major buyers. In addition, it is also important to have networks and distribution channels, access to local market knowledge, a good reputation, a sound financial status, and share financial risk (Moen, O., 2010).
Justify the use of a limited HR budget in pursuing “outside the box” alliance partners.
The use of a limited HR budget can be justified because it includes sharing costs related to entering a new foreign market. This was found to be the main motive for finding a partner. For example, “Pronto” emphasized minimizing financial risk as being an important motive for forming strategic alliances. “Pronto” mentioned that sharing risk with a partner serves as an incentive to create more sales. Therefore, by engaging in strategic alliances, financial expenses decrease and the risk of diluting investors’ shares in a re-financing process was also decreased (Moen, O., 2010).
What are the negative consequences for HR encouraging original thinking when searching for ideal alliance partners?
The main negative consequences for HR when encouraging original thinking for searching for ideal alliance partners are that original thinking may be misconceived as being more complex and time-consuming than it is. In addition, the most demanding part of the search process is to be able to gain initial contact with potential firms. When obtaining information regarding potential partners, managers need to use accessible low-cost sources. Some other challenges include having a lack of networks. When there is a lack of access to networks for acquiring information and support, it is hard to get in touch with key people when entering new foreign markets. The knowledge barriers that a firm has to consider in a foreign market entry are more often easily handled when forming a strategic alliance with a local firm instead (Moen, O., 2010).
References:
Kosin, M., (n.d.) “Brand partnerships that failed miserably” https://www.urbo.com/content/brand-partnerships
Mike, (2020) “13 insightful examples of business partnership ideas” digitalsparkmarketing.com/business-partnership-ideas
Moen, O., (2010) “International market expansion strategies for high-tech firms” International Journal of Business and Management, 5(1), 20-30.
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