Winning Without Competition: How to Break Out of a Commodity ...

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Structure Strategic alliances can be structured in a number of ways, ranging from "gentlemen's agreements" to detailed legal contracts. Informal cooperation, formal contracts, and equity alliances such as joint ventures and minority investments are common examples. These may involve just two companies, or multiple firms in a "network alliance." The structure of the strategic alliance should be subservient to the partnership objectives, as well as to the nature of the relationships. This is true for the management, policy-setting and governance structure, as well. Strategic Alliance Opportunities Within the PC-PS industry, you may wish to consider strategic alliances with other precasters, your suppliers, other subcontractors, and various customers, including contractors, design-build firms, owners and developers. Because firms must retain their independence even when pursuing interdependent strategic alliances, organizations will rarely limit themselves to one partner. This suggests that your precast firm can enter into multiple strategic alliances, yet continue to bid for work from other customers. Strategic alliances do require, however, that the set of changes you make to enhance value with one organization is not broadly and equally shared with that organization's competitors. If you jointly developed an information network with one client, for example, you would not share it with that customer's competitors. Just as you can build alliances with your customers, your suppliers can enter into strategic alliances with your firm to increase the combined value you offer to your clients and the building owner. The alliance between High Concrete Structures and MasterBuilders, a collaboration of technological development and marketing, is an excellent example of this. Alliances improve the competitiveness of both partners through their many benefits. Alliances also offer a means of overcoming many of the disadvantages typically associated with traditional transactions -- the guarded, often antagonistic relationships in which little information is shared and there is little opportunity to enhance value. In effective strategic alliances, the linkages between companies are broad, deep and unique. The greatest value from cooperation comes from integrating each firm's separate processes into seamless operations. Instead of lowest price from the supplier, for example, the emphasis is on lowest total cost. Rather than seeking the fastest separate response times, the goal is shortest combined cycle time. As a result, the most productive customer-supplier interfaces require multi-functional teams which must be involved in depth. To create the most value, a supplier must adapt its organization for each customer's interface, reflecting the need for resources, structures and practices that are unique for each situation. Pamphlet #5 Page 212
Rather than contracts, effective alliances are based on strong commitments. Many alliances function without any contracts at all. They are sustained by a mutual need, a common objective seen as important enough to dominate any issue, a willingness to share the benefits and a trusting relationship. To an important extent, alliances are between people. When adjustments must be made, only people who trust and understand each other can make them in a way that maintains commitments. Only people who share a vision and the enthusiasm to make it a reality will invest the efforts needed for an alliance to succeed. Both organizations must trust one another, and maintain ongoing efforts to develop relationships at multiple levels. Open sharing of information allows each partner to identify collaborative opportunities to increase the value they bring to the marketplace. The need for trust requires that you select a partner that will be committed to the relationship and compatible with your organization. Both partners must maintain a long-term outlook which encourages each to engage in relationship building and information sharing; this will promote identification of emerging opportunities that increase value. Finally, both must appropriately manage the risks that are associated with dissolution of the strategic alliance. (See Sidebar E: Benefits and Key Success Factors of Strategic Alliances). How Will We Measure Success? The Balanced Score Card Measuring the results of your organization on finances alone is fraught with problems. Saavy organizations increasingly use a tool called a Balanced Score Card to measure whether or not strategy is being executed and, if so, is it creating desired results. (See Kaplan references for more information on the Balanced Score Card.) The objectives of the Balanced Score Card include: • Provide a set of performance measures which capture the intent of the business strategy and help drive it forward • Expand management’s focus to include all of those capabilities required to achieve the strategy • Direct the focus of the entire organization toward those performance measures critical to long-term success • Create a dynamic performance measurement system which adapts to the changing needs of the business • Provide a basis for setting long-term performance objectives which drive performance improvements The keys to creating a Balanced Score Card include: Pamphlet #5 Page 213
Page 1 and 2: Winning Without Competition: How to
Page 3 and 4: Introduction One of the greatest fa
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Page 7 and 8: Management and administrative proce
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Page 11 and 12: is so important. It prevents improv
Page 13 and 14: The logic for process redesign work
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Page 33 and 34: critical part of this plan. (See Pa
Page 35 and 36: Sidebar A: Systems Thinking A syste
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Page 39 and 40: Sidebar F: Most of us choose to ign
Page 41 and 42: • Hire, train, deploy work force
Page 43 and 44: Time Redesign Continuous Improvemen
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Page 61 and 62: Is it working? Evaluation Execution
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Job Description Exercise (continued
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• Which items did I prioritize to
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What did I learn? FOLLOW UP LATER T
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Marketing Manager Job Description (
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Marketing Manager Job Description (
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