The “Eight I’s” in Strategic Alliances

There may be no “I” in team, but there is certainly an “I” in strategic alliance. In a recent Harvard Business Review article, author Rosabeth Moss Kanter explains her “Eight I’s That Make We” concept. The article ironically plays with the well-known phrase and suggests that in order to be successful, a company should actually concentrate on the following “I’s” when in a strategic alliance:

  1. Individual excellence: Companies should focus on the strengths that made them an attractive business partner
  2. Importance: Referring to the importance of their strategic relationship, or in other words, if there is not strategic significance, there is no value in the alliance
  3. Interdependence: Business partners should rely on and take advantage of each other’s strengths
  4. Investment: Consider swapping equity of personnel to show commitment
  5. Information: Promote trust in the alliance with transparency
  6. Integration: Combine each partner’s practices in joint activities
  7. Institutionalization: Form an official board that considers the alliance’s interests
  8. Integrity: Business ethics are paramount to the trust in the business relationship

A major theme in the “eight I’s” is focusing on the strengths that exist in the partnership. For starters, the companies should continue on their own individual strengths, or considering a different perspective, what made them desirable enough to become a business partner.

But since companies already intuitively do this before entering a strategic alliance, to what extent will the alliance help the companies expand upon their strengths? After entering the strategic alliance, each company can access a whole new range of strengths, provided by their new business partner. Whether it’s more cost-effective manufacturing or improved customer service, each company will have more strategic assets through interdependence.

While planning the alliance may be somewhat easy, the actual execution is likely to be more problematic. Typically during the execution stage, the business partners will hit bumps in the road that they did not at first expect. And since at this point in their alliance they have probably not practiced institutionalization and formed a deciding committee, the two companies probably need an outside, unbiased perspective and opinion. This is where alliance management comes in to ensure that the execution of the alliance moves forward.

If you’re interested in planning a strategic alliance or need assistance in its execution, contact us.

— by George Tyler

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