This article is part of THNK VIEWS. We bridge theory and practice on organizing imagination and innovation by extracting key implications and offering new insights to innovation practitioners from a rich database of research papers. This article builds on Gunno Park and Jina Kang’s research Alliance Addiction: Do Alliances Create Real Benefits and provides a pathway for successfully managing business alliance formation.
Business alliances remain a tricky thing. On the one hand, alliances allow companies to tap into new markets and growth platforms. At the same time, forming alliances is risky, as it demands trust building and deep knowledge sharing with external parties. In an uncertain business environment, today’s friend may be tomorrow’s enemy. Ideally, both parties benefit equally —but what if they don’t? There are no guarantees of creative and financial success. While some companies have built their success around creative, technological or strategic alliances, others have seen profits rapidly decline. As a result, many companies refrain from forming business alliances, opting instead to focus on in-house R&D to develop new products and services.
Nonetheless, the rise of open innovation has led many to believe that collaboration has become a key way of securing future innovation and creativity —blurring the traditional lines between corporations and institutions within and across sectors. This provides new incentives to turn outwards and form business alliances. Being externally oriented is a key source for coming up with new ideas and offers the best hunting ground for future opportunities and top talent. Venturing with like-minded partners and start-ups with complementary skills and experiences is the key in doing so successfully.