Alliance Management Expertise, Partnering Frameworks and Tools, Collaborative Leadership

What to Do When It Gets “Just Too Hard”
1. Partnering Guide / January 2nd, 2020     A+ | a-
A very successful entrepreneur once told us she knew it was time to iterate her assumptions and change her business when the current way she was doing something was “just too hard.” Ever since that conversation, we watch for this signal. Alliance management within biopharmaceutical firms is showing many signs of hitting the tipping point where it is just too hard to continue implementing alliance management practices as is typically done. One of the key issues raised during our 2018 research project with more than 30 biopharmaceutical companies both large and small was the challenge of an ever-increasing workload—both a growing portfolio to manage and the increasing technical complexity of the alliances making up the portfolio.[1]

Lately, we are hearing from numerous leaders that the juggling act of keeping all the “balls in the air” threatens to come crashing down. As one head of an alliance management group told us, “Sometimes I have to give my people permission to ignore certain partners.” We’ve recently talked with a few people newly assigned to executive roles with oversight for alliance management. Their number one question is, “How many alliances can one person manage?” The answer, of course, is it all depends.

Without a doubt, the number of biopharma alliance managers has increased over the past several years. It had to. The traditional research and asset-based alliance portfolio has continued to grow both organically and through acquisitions. In some firms, alliance managers are playing a role in integrating acquired companies, not just the alliances that come with an acquisition. The number of clinical collaborations to test possible combination therapies has exploded. Alliance managers are also tasked with shutting down alliances where once promising science doesn’t make it to the goal line or strategies change with new CEOs.

Couple this with our truly partnering everywhere business environment. Alliance managers tell us that as much as they would love to be involved with new types of partnerships, such as digital health and beyond the pill collaborations, they just don’t have the time and resource to expand their remit. As a result, professional alliance managers are rarely involved in these challenging new alliances, most likely resulting in teams making avoidable mistakes, wasting time, money, and delaying or not getting valuable therapy to patients[2]. It will become an area of lost opportunity to alliance managers if they don’t find ways to engage soon, either directly or through centers of excellence initiatives.
 
Coping strategies such as tiering, limiting the scope of the portfolio that is managed, and leveraging other functions, especially project and program management, have long been deployed. This eases some of the workload challenge, but also has limits and introduces new risks, notably:
  • Tiering results in some alliances unmanaged or “managed” by people for whom it is not their job or skillset
  • Lack of oversight adds risk and overlooks opportunities to add value because of limited visibility into the portfolio
  • Alliance managers are forced to become primarily reactive, diminishing their value to stakeholders
This last point is quite important. For alliance managers to truly add value, they need to be engaged with and immersed in the teams executing the work of the alliance. The greater the degree of complexity and risk within an alliance or alliance portfolio, the more high-touch the management of both partners and internal stakeholders needs to be to realize intended value. This is nearly impossible when the workload is overwhelming. Alliance managers then necessarily tend to focus on the routine work of an alliance, including governance, contract management, and reporting, which leaves no time for the proactive risk management and problem solving, decision planning, gaining alignment, and strategic opportunity evaluation that stakeholders truly value.

Thus, the ability of professional alliance managers to deliver value to stakeholders is a function of three elements (See Figure 1—Factors Influencing Value Delivery):
  • The value/complexity characteristics of the alliance portfolio
  • The alliance management resources available
  • The alliance management services the portfolio requires to produce intended results
Finding the right balance of these factors has traditionally been the key to answering the question, “How many alliances can one person manage?” 

But if it is just too hard to make this juggling act work any longer for alliance managers and the stakeholders they serve, then it is time to iterate some key assumptions.

The most obvious assumption to rethink is the way in which alliance management principles and practices are implemented. Many companies trying to deliver greater value and improve their efficiency have taken a page from the discipline of agile software development to rethink how they go about their work.

Characteristics of Agile Alliance Management Teams

Agile is a complex, holistic philosophy typically applied to innovation. In recent years, its principles have been applied to businesses as varied as Haier, a Chinese white goods manufacturer and F. Hoffmann-LaRoche, a leading global healthcare company.[3],[4] The results have been eye-opening. According to McKinsey, “Agile organizations can develop products five times faster, make decisions three times faster, and reallocate resources adroitly and quickly.”[5] An alliance management function that chooses to adapt agile principles will never look like an agile software development implementation. But it can benefit in a substantial way and begin to address some of its workload and value delivery challenges, producing its versions of the results the early adopters of agile methodologies and principles are claiming.
 
Focus on Value and Experience
 
One of the key principles of agile is how it organizes work, beginning with a laser-like focus on creating customer value. If it isn’t clear how something contributes to a positive customer experience and creating the outcomes they seek, it isn’t done. The corollary in thinking about alliance management is a focus on delivering value to stakeholders and delivering the partner experience that will encourage them to be collaborative—to have a “one-team” 
mentality—and for the partner to short list your company as a potential collaborator 
when it has exciting new opportunities. (See Figure 2 – Characteristics of Agile Alliance Management Teams).
 
Questions alliance managers who want to pursue the implementation of agile alliance management practices should ask include:
 
  • How should we evaluate the overall company portfolio of alliances and partnerships to determine the alliance management services they require to deliver desired stakeholder value and partner experience?
  • What are the alliance management services stakeholders’ value most within each segment of the portfolio?
  • What is the experience partners’ expect when they engage with us? (Partners understand they may not be the most important partner for your company. They still want to be treated first among equals.)
 
It is a Team Play
 
Agile organizations are based on small, special purpose teams that focus expertise and task orientation to deliver customer value. These teams may be short-lived, charged with achieving a specific single objective. They may be longer-term, with a mandate of repeatedly conducting a critical process step again and again. The focused expertise encourages innovation and continuous improvement, ensuring that inefficiencies are minimized and additional value captured.
 
Alliance managers should think about the alliance lifecycle and the standard practice of all alliance managers having essentially the same job—managing an alliance from start to finish. To apply agile principles regarding the use of teams to alliance management, consider the following questions:
 
  • What tasks across the alliance lifecycle would benefit from having a focused, specialist team that is constantly innovating how the task or process is carried out?
  • How would you reconfigure alliance management roles across the alliance lifecycle if you had such specialist teams?
  • How could specialist teams drive consistency, ensure sufficient risk management, and contractual compliance if certain alliances are to be self-managed by project teams and not by alliance management?
 
Be Proactive and Prioritize
 
One of the chief complaints from stakeholders indicative of workload overload is that alliance managers are too reactive. Agile organizations are religiously proactive. They break their work down into short “sprints,” each of which has specific goals or milestones that create demonstrable value for customers. Anything new that comes their way not directly related to the goal in front of them is “backlogged,” ensuring that resources are prioritized to that which will help them reach their North Star.
 
In an alliance context, this means prioritizing the services that create the greatest value for stakeholders and improve the partner experience. Alliance managers that embrace agile principles can become much more proactive, efficient, and valued by answering the following questions:
 
  • What are the key decisions that have to be made in a relevant timeframe and how can alliance managers ensure that the decision is made through a purposeful, iterative process that gets us to a desired outcome by (in advance) of the due date?
  • How to move from reactive to proactive problem solving by implementing robust risk management processes?
  • How to work to speed up routine work cycles, such as governance preparation and follow up with a dedicated operations team?
 
Welcome to the Partnering Everywhere World
 
There is no doubt that alliance management is a critical strategic capability in today’s biopharmaceutical firm where nearly every function depends on some form of external partnership. The demand for it will only continue to grow. Many alliance management teams, whether teams in large pharma that have 10 to 20 people each managing 10+ alliances and developing centers of excellence to further support their colleagues, or one-person departments in emerging biopharma who are at saturation point with three major alliances—and more on the way—are finding it just too hard and need to iterate some key assumptions. Applying the principles of agile to how alliance management is implemented is a promising evolution. 
 
[1] Jan Twombly and Jeff Shuman, “No Longer Any Doubt: Alliance Management is an Essential Strategic Capability for Today’s Biopharmaceutical Company.” Strategic Alliance Magazine, Q3 2018.
[2] Michael Burke, “Digital Health at the Crossroads.” Strategic Alliance Quarterly, Q4 2019.
[3] Gary Hamel and Michele Zanini. “The End of Bureaucracy.” Harvard Business Review, November-December 2018.
[4] Tammy Lowry, Michael Lurie, Paul Byrne. “How Roche pursues agile and digital transformation.” January 2019 Interview, McKinsey & Company.
[5] Aaron De Smet, Michael Lurie, Andrew St George. “Leading agile transformation: The new capabilities leaders need to build 21st-century organizations.” McKinsey & Company, October 2018.
 
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