The Practice ofAlliance Management in theBiopharmaceutical Industry
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December 2010
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► Over 25 years of hands-on experience designing, building and managing strategic alliances and collaborative networks
► Methodologies and measurement tools applied in large, complex organizations within
■ life sciences
■ International economic development
■ energy
■ Information technology
► Member of team that created the first alliance management professional certification
► Leaders in the only alliance management professional organization
► Operational, consulting, research, academic pedigrees
The Rhythm of Business helps organizations innovate and succeed through collaboration
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Sponsors
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Study Overview
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What are the roles, responsibilities, and organization of alliance management functions as
biopharma business models become more dependent on alliances and
companies develop their collaborative ability?
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Research Question
AcordaActelionAlk-AbelloAmag PharmaceuticalsAmgenAstellasAstraZenecaBayerBiogen IdecBristol-Myers SquibbChugaiCubistDaiichi SankyoEisaiElanEli Lilly
Facet BiotechGenentechGilead SciencesGlaxoSmithKlineGrunenthalHalozyme TherapeuticsHospiraImmunoGenIpsenJohnson & JohnsonLexicon PharmaceuticalsMedicisMedivationMerckMerck Serono
MundipharmaNovartisNovo NordiskNycomedPfizerPharmacopeiaPTC TherapeuticsRocheSanofi-AventisSepracorShionogiShireSignum BiosciencesSolvayTakedaXoma
58 Study Participants Representing 47 Companies
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Headquarters Location
56%
11%
33%
The Americas
Europe
Asia
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Longevity of Alliance Management
37%
25%
38%
3 to 5 Years
More than5 Years
Less than3 Years
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Biopharmaceutical companies are increasingly dependent on alliances and collaborations
It would make sense to invest in developing an organizational
capability to succeed at alliances and collaborations
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The evidence shows this is not the case
Less than 3 Years 3 to 5 Years More than 5 Years
More than half of alliance management groups participating in the survey have
fewer than five members
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Less than 3 Years 3 to 5 Years More than 5 Years
Nearly half of all survey participants manage three or fewer alliances
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Alliance Management InfluenceReflects Multiple Questions
Less than 3 Years 3 to 5 Years More than 5 Years
Influence is growing – but insufficient
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Elevate and promote alliance management as a recognized capability essential to achieving
corporate goals© 2010 The Rhythm of Business, Inc.
Become marginalized if undermanaged portfolios
underperform and the value of specialized alliance
management is not recognized14
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Positioning in the Corporate Hierarchy
Less than 3 Years 3 to 5 Years More than 5 Years
A majority of alliance management groups have a reporting relationship
through business development
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Less than 3 Years 3 to 5 Years More than 5 Years
As groups mature, they are more likely to be led by vice presidents
or senior vice presidents
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Less than 3 Years 3 to 5 Years More than 5 Years
Alliance management groups are following the industry trend of moving to more globally oriented organizations
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Things aren’t always as they appear
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Less than 3 Years 3 to 5 Years More than 5 Years
Perception: CEOs’ view alliance management favorably
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Less than 3 Years 3 to 5 Years More than 5 Years
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Playing an essential role
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Less than 3 Years 3 to 5 Years More than 5 Years
A stepping stone in a general management career and for a few, a profession
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Your Opportunity
Build on positive perceptions to define the role you seek and
create visibility and awareness of it throughout your organization
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The Job of anAlliance Manager
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Alliance Manager as Choreographer
Rallying people and their resources to achieve the vision of the alliance
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The essence of the job
Time
Risk Value
L
HM
anag
emen
t C
ompl
exit
yPo
tent
ial V
alue
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Increasing Portfolios,Limited Resources
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Man
agem
ent
Com
plex
ity
Potential Value
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One of three conditions often result, usually in combination:
► Some alliances are not being managed
► Individuals with other functional responsibilitiesalso managing alliances
► Key responsibilities relinquished over time toaccommodate a growing and/or increasinglycomplex portfolio
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Less than 3 Years 3 to 5 Years More than 5 Years
In 60% of companies “simpler” alliances may be managed as
part of someone else’s job
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The Company’sAlliance Portfolio
The Company’s Alliance Management Capability Design
The challenge is to dynamically align the company’s ability to do business through
strategic alliances and collaborations with its alliance portfolio
Functional Corporate
Part-time Dedicated
Program/Product Alliance
General Specialized
Ad Hoc Systemized
Locus
Staffing
Role & Accountability
AM Knowledge Base
Processes & Tools
Factors Dimensions
.
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Role and Accountability of Alliance Management
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Alliance management groups take on an increasing array of responsibilities
throughout their first five years
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As time goes on, alliance managers relinquish key responsibilities of
planning and evaluation
0%10%20%30%40%50%60%70%80%90%
100%
Strategic plan Operating plan Health assessment
Perc
ent o
f Res
pond
ents
Planning and Evaluation
Less than 3 Years 3 to 5 Years More than 5 Years
Planning and Evaluation
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Alliance Management Led TrainingMultiple Responses Allowed
Less than 3 Years 3 to 5 Years More than 5 Years
Coaching others to collaborate more effectively is a primary responsibility
of most respondents
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Accountability
Primary accountability – Defined objectives other than alliance milestones
Alliance by alliance, NOT the overall portfolio
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Implications
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Less than 3 Years 3 to 5 Years More than 5
Years
Development Milestones for an Alliance Management Capability
►Determine capability design
►Be clear on role and value
►Educate team members and executives
►Develop consistent , systematic practices and tools
►Increase responsibilities for ■ Planning and
evaluation■ Alliance
formation■ Skill building
►Align the capability with the portfolio
►Make tools and processes accessible to others
►Ingrain the capability in the organization’s psyche
►Deliver greater value with limited resources (don’t give up planning and evaluation)
►Proactively support functional managers with part-time alliance management responsibility
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Closing the Gap
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►Evaluate the portfolio from the perspective of the purpose of alliance management
►Analyze each individual alliance to determine how best to manage it within the context of the overall portfolio
►Establish a consistent alliance management philosophy, processes, and tools
►Proactively define and communicate the role and accountability
Ensuring all alliances are appropriately managed
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Being established is never equivalent to being relevant
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If you can walkYou can danceIf you can talkYou can sing
– Proverb from Africa
The Rhythm of Business, [email protected]+1 617.965.4777
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