The Alliance Maturity Model — A Useful Tool to Evaluate Your Organization’s
Alliance Management Capability
By Stuart Kliman and Stuart Price
Why Alliance “Maturity” Matters and the Alliance
Maturity Model
Unpacking Some Components of the Model
Underlying the Alliance Maturity Model is the premise that
certain organizations should and need to strive towards the
most mature, Level 4 alliance management capabilities. If
an organization has a portfolio of alliances which is deemed
strategically important enough to the point where the
organization is investing in capability, then Level 4 is what
“capable” looks like. If an organization is too early in its capability
needs lifecycle (i.e., a small number alliances of minimal
strategic importance) it may not be worth the investment to
move from Level 1 to Level 4. Part of the model relates to the
fact that organizations begin with Level 1 maturity, and as the
number, complexity and importance of alliances increases for
organizations, so does the investment in capability and therefore
an increase in the level of maturity.
Companies increasingly rely on alliances to drive value for their
organizations. Recognition that alliances can bolster bottom
lines has led to growth — both in size and complexity — of
organizations’ alliance portfolios. In order to maximize the value
of these strategic portfolios, organizations must develop robust
alliance management capabilities that enable the success of
individual alliances as well as the portfolio as a whole.
For more than a decade, Vantage has worked extensively with
clients to help build out their alliance management capabilities.
This process of evolving the organizational approach to alliance
management is understandably unique for each company and
the decision of when and how to invest in developing capability
can depend on a multitude of factors (e.g., industry dynamics,
changes in the competitive landscape, alliance number and value).
Nevertheless, clients often want to know what a “mature” alliance
management capability looks like for their organization and how
they can develop the necessary elements behind that capability.
Organizations that are attempting to mature their alliance
management capability need to focus on key elements that
comprise that capability. In such organizations, regardless of
industry, we have consistently identified six crucial elements:
„„
Strategic Importance and Operating Model
To help answer these questions, Vantage has developed our
Alliance Maturity Model (see Figure 1). The model has roots in
various research endeavors — both academic and for clients —
as well as years of experience helping clients at various stages of
alliance maturity in their quest to improve their capabilities. The
first iteration of the model was created during a client study in
which Vantage helped to identify what the “next level” of alliance
capability might look for the client through a series of interviews
with Heads of Alliance Management across industries. The
current refined Alliance Maturity Model encapsulates all our
learnings to date, and attempts to identify the underlying
components of alliance maturity and differentiate the unique
levels of maturity through which we see companies progress.
„„
Alliance Management Mission and Focus
„„
Structure
„„
Processes and Tools
„„
People and Culture
„„
Reputation
The presence and robustness of each of these capability
elements can range significantly within and across organizations.
The Alliance Maturity Model helps to unpack some of this
variance by mapping each of these elements across the four
levels of alliance maturity.
For organizations investing in alliance management capability,
the model also illustrates an ultimate goal or end state. At
Level 4 maturity, organizations will have invested in capability
to the extent that they consistently maximize the value of
their individual alliances and alliance portfolio, controlling for
inherent product/technical risks. Based on our experience, Level
4 capability means the following:
The purpose of this article is to introduce the Alliance Maturity
Model, and also share some initial findings related to the model
from Vantage’s ongoing alliance management study. It is the hope
that sharing the model (of which Vantage is more than happy
to provide a copy) and preliminary observations will be useful
for internal discussions about alliance management capability.
1
Elements
Level 1
Level 2
Level 3
Level 4
Strategic
Importance
and Operating
Model
Alliances are a relatively
new or under-utilized
strategic tool
Alliances are an
important and
increasingly
valued tool
Alliances are essential
to success but the
organization has not
fully adapted standard
operations to reflect this
Alliances are essential
to success and the
organization’s priorities
and operating models
reflect that
Alliance
Management
Mission
and Focus
Alliance management, to
the extent that it exists,
is about maximizing
the performance of
individual alliances
Alliance management
is mostly about
maximizing the
performance of
individual alliances
Alliance management
is about maximizing
the performance of
individual alliances with
informal approaches
to alliance portfolio
management
In addition to a
focus on individual
alliance performance,
significant attention is
paid to managing the
company’s collection
of alliances in a holistic
manner, as a portfolio
Structure
No formal alliance
management group
or function exists; the
Alliance Manager role
is new or non-existent
A formal alliance
management group
is young or forming;
Alliance Managers are
typically assigned to key
alliances
A formal alliance
management group
is well-established;
Alliance Managers
are always assigned
to key alliances
A formal alliance
management group
is well-established
and has organizational
influence
Processes
and Tools
Alliance management
is ad hoc with no formal
tools or processes
Some formal processes
and tools have been
developed but are
not widely used
Formal processes
and tools are being
used and adapted
across alliances
Formal processes and
tools, based on best
practice, are regularly
utilized across alliances
People
and Culture
Alliance management
knowledge and
competence comes from
a few interested and
naturally collaborative
individuals
Alliance management
knowledge and
competence is sought
after when staffing
and recruiting alliance
managers and group
leaders; training
and education are in
development
Alliance management
knowledge and
competence is actively
developed through
education and training
for all alliance-involved
employees
Alliance management
is part of corporate
DNA; Executives to
front lines understand
and consistently
demonstrate the
importance of
collaborative behavior
for alliance success
Reputation
No partnering reputation
Partnering reputation is
mixed and limited to a
small ecosystem
Partnering reputation
is mixed within a larger
ecosystem of partners
and potential partners
Considered a “partner
of choice”; widely
known for excellence in
alliance management
Figure 1: The Alliance Maturity Model
2
Level 1
Level 2
Level 3
and a recognition that such an intent requires a specialized
capability. Unsurprisingly, companies (even those with a stated
commitment to managing alliances) range the full spectrum of
alliance management maturity. As part of our ongoing alliance
management study, Vantage is investigating the current state
of organizations’ alliance maturity — both within and across
the six core elements of our model. Our research also examines
the level of alliance maturity with which companies feel they
need to maximize the value of their partnerships. Although
preliminary, we have seen several interesting observations
emerge in our analysis.
Level 4
Average alliance
management
maturity level
Level needed
to maximize
the value of
alliances
2.53
3.49
Nearly a full level
of discrepancy
„„
There is nearly a full level of discrepancy (see Figure 2)
between organizations’ average alliance maturity level
and the level of capability needed to maximize the value of
partnerships. Respondents report an average alliance maturity
level of 2.53 (see Figure 2), a number that represents over a
hundred organizations of varying industries, size and alliance
experience. Nonetheless, those same respondents indicate
their organizations require an average alliance maturity level
of 3.49 to maximize the value of their alliances. This data
implies that at their current maturity, organizations are failing
to capture significant value from their alliances. Organizations
thus have an incentive to continue investment in alliance
management capabilities to bridge this gap.
Figure 2: The Alliance Maturity Gap
„„
Alliances are strategically imperative and deeply engrained
in the operating model
„„
There is significant focus on the alliance portfolio in addition
to individual alliances
„„
A formal alliance management group is well-established and
has organizational influence
„„
Formal processes and tools are regularly used across alliances
„„
Alliance management is a part of the entire corporate DNA
„„
The organization is known for excellence in alliance
management
As an aside, the data seems to reveal a natural bias for
organizations to inflate their overall alliance management
capabilities. On average, organizations indicate they are
closest to Level 3 maturity. In our experience, a Level 3 alliance
management capability is advanced and requires significant
Emerging Maturity Data
The decision to build a robust alliance management capability
needs to be made at a senior level and connected to both a clear
intent to grow an organization’s reliance on external relationships
Level 1
Level 2
Level 3
2.73
Strategic Importance and Operating Model
Alliance Management Mission and Focus
2.63
2.62
Structure
2.52
Processes and Tools
People and Culture
2.19
2.66
Reputation
Figure 3: “People and Culture” lags behind other maturity elements
3
Level 4
organizational investment (including buy-in from senior
leadership). Certainly some organization have matured to
Level 3 capabilities — but this is the exception, not the norm.
„„
Several elements of alliance maturity — namely “People
and Culture” and “Processes and Tools” — lag behind other
elements (see Figure 3). In particular, “People and Culture”
(Level 2.19) lags significantly behind other more mature
elements such as “Strategic Importance and Operating
Model” (Level 2.73) and “Reputation” (Level 2.66). As
companies’ alliance management programs mature, we
expect corporate mindset and capability to shift from
dependency on a few naturally collaborative people, to
an alliance-centric culture that fully supports and enables
collaborative behavior organization-wide. Nonetheless, the
data suggests that organizations with advanced strategic
focus on and processes around alliance management still
struggle to integrate an alliance management capability
into the corporate DNA and demonstrate the importance
of collaborative behavior for alliance success. This can lead
to corporate environments where Alliance Managers are
“lone wolves,” individual alliances are treated as independent
ecosystems and there is a lack of fundamental orientation
toward partnering.
Practical Uses of the Model
Vantage frequently uses the Alliance Maturity Model in
client work and research as a tool to conceptualize alliance
management capability growth. For our clients and other
organizations, the model can be of use in several ways. First,
organizations can use the model as a useful diagnostic tool to
pinpoint their current alliance maturity level, providing a quick
“pulse check” of capability. Using the model, we suggest running
an internal working session with key alliance stakeholders to
examine where your organization is now with regards to alliance
management capability and where it needs to be in order to
maximize the value the alliance portfolio. Such a working session
can be purposed to examine capability overall and/or element
by element. In a slightly different light, organizations can also
use the model as a tool to benchmark their capabilities against
industry standards or similar organizations. In either application,
the hope is that the Alliance Maturity Model will help facilitate
internal dialogues around capability for organizations engaged in
the ongoing maturation process and act as a useful benchmarking
tool — both internally and against similar organizations.
These preliminary observations offer interesting insights into the
broad picture of the alliance management field today. As Vantage
progresses in our study, we will continue to leverage the Alliance
Maturity Model to take a granular look at the implications of
how companies of different industry, size and alliance experience
perceive their alliance management capabilities.
About Vantage Partners
Vantage Partners, a spin-off of the Harvard Negotiation Project, is a management consulting firm that specializes in helping companies
achieve breakthrough business results by transforming how they negotiate, and manage relationships with, key business partners. To
learn more about Vantage Partners or to access our online library of research and white papers, please visit:
www.vantagepartners.com
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