by the other party in the alliance, they responded by choosing a mix of the two available pathways: either to try to work with that individual, at least initially, or to try to seek out someone at a more comparable, i.e. senior, organizational level to work with early on.
All “official contract business” should go through the alliance manager, but when issues do arise, the management teams can rely on personal interactions to address an issue. However, the alliance manager should always be in the loop. “You need to work with whoever is assigned to be the point person but you should also have multiple points of contact between the companies, as there are many changes that happen within larger organizations that can make relying only on one point of contact not advisable for a successful partnership,” counseled Todd MacLaughlan, CEO of Eclipse Pharmaceuticals, in his advice to senior executives. “The role of alliance management should be to coordinate information flow and to address any concerns early while staying focused on the strategic and tactical objectives of the collaboration.” Ruhi Khan, vice president of business development at Acorda Therapeutics, advised that in coaching a team through these situations, “It is important to understand the organization culture and operating environment. This is where alliance managers can play a critical role, as they are on the front line. Once this has been established, the management teams can and should try to build their own relationships with their counterparts. All ‘official contract business’ should go through the alliance manager, but when issues do arise, the management teams can rely on the personal interactions to address an issue. However, the alliance manager should always be in the loop.” Giving an IT industry perspective on this issue, Pat Horgan, vice president of manufacturing, development, and operations for IBM Canada, indicated that there may be a third way, apart from seeking a similar-level senior executive. “Some cases may need the appointment of a third-party AM leader to ensure balanced focus,” Horgan stressed. “This requires respect of all parties. If possible, while it is great to 32
have senior executives in the group, it is also good to have a backup representative to ensure continued momentum.” Still, he added, “in the end, this kind of situation really needs partners who are bought into the end objective, and the view that by combining resources everyone will come out further ahead—both the individual members and the collective group. If they are engaged at that level, we can power through the hurdles that present themselves in any project.” Refreshingly candid in his approach, Bruce Williams, CEO of WellGen, Inc., noted that sometimes the situation does call for the senior executive to “respect the relationship…but not too much.” He explained that on at least one occasion he found it necessary to work around the partner AM, discussing an issue directly with partner senior management, and only later informing the AM. He recognized that this kind of behavior generates its own set of issues, but in this case urgency trumped protocol. Williams cautioned, “Use this approach very sparingly so as not to break trust, but at times it can be both effective and very important. It helps define boundaries when they have not otherwise been accepted.” Overall, the group of experts seemed to agree that discovering that the senior executive counterpart is aggressively seeking a senior peer at the partner company can be a hard situation for the partner company’s more junior AM to deal with when it happens. An alternative for the senior executive to consider is to bring the AM along for the senior management discussion—unless the AM is considered to be the problem! Including the AM can ensure that the necessary trust and respect in this critical relationship do not erode.
Overcoming Disparity in Decision-Making Authority The panel explored other obstacles they have seen with a junior-senior mismatch in alliance managers. For example, how do you proceed when you have a key decision that needs to be made for the collaboration to go forward, yet you and your counterpart have been unable to reach agreement, and one of you is empowered to make a decision for his/her company but not the other? “Clear communication between the parties is key at this critical juncture,” said Khan. “Alliance managers have to relay the nature of the decision and potential solutions that can be addressed and involve the decision makers who can resolve the issues. Contracts Strategic Alliance Magazine
Non ASAP Member Limited Edition, Q3, 2011