The Daily Drucker

19 December Rules for Successful Alliances

Alliances tend to get into serious trouble when they succeed.

While their failure rate in early years is no higher than that of new ventures, alliances tend to get into serious trouble—sometimes fatal—when they succeed. Often when an alliance does well, it becomes apparent that the goals and objectives of the partners are not compatible.

The problems can be anticipated and largely prevented by following five rules.

1. Before the alliance is completed, all parties must think through their objectives and the objectives of the “child.”
2. Equally important is advance agreement on how the joint enterprise should be run.
3. Next, there has to be careful thinking about who will manage the alliance.
4. Each partner ...