An early and candid assessment of the two parties' strategic objectives, organizational cultures, and capabilities can sweeten the odds of success.
How We Help Companies Launch Strategic Alliances
Like other collaboration models—joint ventures, M&A deals, simple contractual arrangements, and participation in digital ecosystems—strategic business alliances have unique advantages.
Strategic alliances also come with some disadvantages, including greater counter-party risks and less control over the partnership.
We help companies determine whether a strategic alliance is right for them. If it is, we support clients through every phase of the strategic alliance lifecycle—from crafting a smart alliance strategy to establishing an office dedicated to their strategic alliance structure and setup.
Our Client Work in Strategic Alliances
We bring unique strengths to clients considering a strategic alliance and seeking to set up and manage such collaborations.
Extensive Expertise
Our teams have conducted approximately 500 alliance and joint-venture projects in the last five years, around the globe and across a diverse array of industries. We have more than 25 experienced partners dedicated to strategic alliances and joint ventures, along with a team of analysts.
Our teams have conducted approximately 500 alliance and joint-venture projects in the last five years, around the globe and across a diverse array of industries. We have more than 25 experienced partners dedicated to strategic alliances and joint ventures, along with a team of analysts.
Proprietary data, tools, and libraries
Our suite of proprietary resources includes an extensive database of all strategic alliances and joint ventures formed in the last 30 years; SynergyDatabase and SynergyBuilder to support financial baselining, synergy target setting, and methodology planning; a survey to assess cultural fit between two alliance partners; and our iTSR-based tool for aligning business, investor, and financial strategies.
Our suite of proprietary resources includes an extensive database of all strategic alliances and joint ventures formed in the last 30 years; SynergyDatabase and SynergyBuilder to support financial baselining, synergy target setting, and methodology planning; a survey to assess cultural fit between two alliance partners; and our iTSR-based tool for aligning business, investor, and financial strategies.
End-to-End Approach
BCG’s strategic alliances consulting experts apply a six-step strategic alliance framework covering all phases of the alliance life cycle.
BCG’s strategic alliances consulting experts apply a six-step strategic alliance framework covering all phases of the alliance life cycle.
The Six Stages of the Strategic Alliance Life Cycle
Alliance Strategy
- Crystallize business aspirations, strategic choices, and preferences.
- Identify areas that need, or can benefit from, a strategic alliance.
- Define the strategic objective and rationale for the alliance.
Partner Screening
- Define your desired partner attributes and determine partner search space, including alliance objectives, desired capabilities, and competitive and size constraints.
- Prioritize and short-list partner candidates based on the attractiveness of capabilities, size, and competitive position.
- Define a partnership thesis for short-listed candidates, assessing value creation, capabilities, corporation models, and potential risks.
- Prioritize candidates and plan a timeline for outreach and due diligence.
Partner Due Diligence
- Conduct due diligence along two main dimensions: value creation potential and collaboration fit.
- Conduct initial, outside-in due diligence using public information.
- Initiate partner outreach.
- Conduct presigning due diligence with partner’s data and clean teams.
Negotiation
- Define sources of value creation and fields of cooperation.
- Define alliance objectives by time horizon, including quick wins, medium term goals, and ultimate goals.
- Define how the created value will be shared.
- Define exit conditions.
- Define resources allocated to the alliance.
Alliance Design and Setup
- Design governance model, structure, and mechanisms, including organizational model and workstreams, coordination and decision-making mechanisms, and monitoring and control mechanisms.
- Define the rules of engagement, including scope of exclusivity, openness to new members, and rules of information exchange.
- Delineate where to compete and where to collaborate.
- Design legal company structure, if any.
Alliance Office Creation
- Define the mandate of the alliance office, with distinct roles and responsibilities from both business units.
- Design alliance office organization, including centrally shared services and a business unit dedicated to the alliance function.
- Execute on agreed-upon exit conditions at the end of the alliance.
M&A Activity by Year: The BCG M&A Report Collection
BCG's annual mergers and acquisitions report covers M&A activity by year, the current state of the market, and perspectives on deal-making trends.
Our Insights on Strategic Alliances
Video
July 14, 2020
Why Partnerships, Joint Ventures, and Alliances Fail
Article
February 14, 2022
Corporate-led sustainability alliances can be a secret weapon in the drive to create system-level change. We discovered ten factors that separate high-impact CSAs from the rest.
Article
January 13, 2022
More companies are forging strategic alliances as they seek competitive advantage. Here’s what they must do to build and manage them successfully.
Meet Our Strategic Alliance Consulting Experts
BCG’s strategic alliances consulting experts help clients design, launch, and manage high-impact partnerships that drive innovation, unlock synergies, and sustain competitive advantage. These are some of our experts on the topic.
