How to Manage a Portfolio of Alliances

Abstract

Many companies have become embedded in a dense network of relationships as a result of intensive alliance activities. A company's alliance portfolio therefore crucially influences its competitiveness and financial performance. This study researches the question of what management tasks - beyond those of managing individual alliances - arise in companies with multiple alliances and how large global companies deal with such tasks. The author analysed the multi–alliance management practices of 25 leading European companies and identified four tasks of portfolio management: strategy, monitoring, co-ordination and the establishment of an alliance management system. To implement these tasks, companies need to create a dedicated alliance function and develop companywide standards and customised tools for multi-alliance management. This is the only way to ensure that the alliance portfolio contributes to attaining the company's strategic goals.