Creating Profit Through Alliances - business models for collaboration E-book | Page 37

Strategy

Customer
relevance

Purpose of the alliance

Basic form

Using the other party's local
presence and service

Distribution agreement

Expanding one's own
perceived presence

Franchising

Increasing the chance of
obtaining leads

proposition alignment
and referral

Expanding one's own market
to larger projects
Utilizing the relevance of the
other party's brand

Unique product

Utilizing the other party's
development capacity
Utilizing the other party's
technology
Achieving scale advantage
and risk reduction

Cost advantage

Limiting one's own staffing

Utilizing the other party's
cost benefits and experience

Figure 18. Ten forms of alliances

Some forms require further explication. Distribution in
itself does not necessarily imply a partnership,
certainly if it concerns the purchase and resale of
goods and standardised services. However, as soon as
the supplier and distributor jointly devise a plan to
place goods and services in the market and to
increase the market share, we may speak of a
partnership.
The same applies to technology licensing. This may
amount to nothing more than reselling a use right to
a patent or to software. But as soon as this is
complemented with knowledge transfer or if
exclusivity agreements are made, this may certainly

amount to a partnership.
This is demonstrated by
the pharmaceutical
industry.

The last form mentioned unusual supplier risk should also be explicated.
In legal terms this often
Collaborative offering
involves a purchasing
agreement between a
Co-branding
customer and supplier,
which does not
necessarily qualify as an
Joint R&D
alliance. However, if the
supplier accepts a risk
Technology licensing
that goes beyond the
usual in his operational
Shared investment
management, then it may
be termed a partnership.
Reciprocal hiring
This applies, for example,
agreement
to outsourcing, in which
Unusual supplier risk
the supplier takes on
personnel from the
customer, often without
any guarantees as to the amount of work he can
expect. Such mutual dependency and shared
operational management also emerge in publicprivate partnerships, as when project developers take
on financing and long-term maintenance obligations,
for instance for highways.
Chapter 3 takes a closer look at the various goals of
an alliance and how these can serve to generate
value. Chapter 4 examines for each form individually
how this value can be divided between the partners.
Finally, Chapter 5 offers some suggestions on how to
establish the structure in the form of a contract.

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