This week’s readings focused on collaboration and alliances between businesses – both domestic and international. Gulati (1998) focused on how networks assisted with the formation of alliances, which has a communication component, and Kanter (1994) touches on the need for communication to overcome some of the hurdles of a strategic alliance. However, neither author focuses on the strategic importance of communication on the overall scheme of an alliance or partnership.
Butler (2010) states increased technology development costs and more competition from foreign companies as two reasons for an upswing in strategic alliance activity (pg. 698). The benefits of collaboration such as pooled resources for costs and breaking into a new international market were already covered by our readings this week (Kanter, Gomes-Casseres). Butler uses the example of a defense contract to explain how communication can be the linchpin for a successful international alliance.
Communication has two key objectives in the management of change. The first is to facilitate understanding by those who need to adopt new processes of what will change and why. Interpersonal communication is a substantial part of the interaction process and can therefore be regarded as a process element of relationships and networks. (Butler, pg. 702)
Successful integration of a strategic alliance requires collaboration between all levels of management for success – strategy, tactics and operations (Kanter, 1994). While Kanter focuses on the need for cultural awareness, Butler (2010) shows that communication is also key to this success.
Butler (2010) surveyed 76 firms involved in international alliances (out of a 250 initial sample size) and asked about the communication between partners in the alliance. The surveys and follow-up interviews showcased the need for communication throughout the alliance process.
Using Kanter’s (1994) phases of the business relationship, communication is essential in each.
• In courtship and engagement, “there may be hidden agendas” (Butler, 704). Communication is important to determine and resolve these agendas. “Several respondents stressed that it is important to have skills in interpreting conversation in order ‘to understand what really makes them tick’” (Butler, pg. 704).
• In the newlywed stage, “mistranslation of documents, misinterpretation of communication at meetings and the wrong calibration of technical measurements across different countries are the greatest sources of frustration and problems in the communication process” (Butler, pg. 704).
• In the old married stage, maintaining high levels of communication is important.
Butler’s (2010) research continues into the specific challenges faced in an alliance that includes 3 or more nations and how the potential for miscommunication is significantly increased. As a way of resolving communication, Butler (2010) suggests increased meetings between upper and lower levels of management and team-oriented decision making (pg. 708)
References
Butler, C. (2010). “Internal and lateral communication in strategic alliance decision making.” Management Decision, 48(5), 698-712. Retrieved February 19, 2012, from ABI/INFORM Global. (Document ID: 2044879541).
Gomes-Casseres, (1993). "Managing International Alliances: A Conceptual Framework." Harvard
Business School. pp. 1-20.
Gulati, R. (1998) "Alliances and Networks" Strategic Management Journal, Vol. 19, pp. 293-317.
Kanter, R. (1994). "Collaborative Advantage: The Art of Alliances."Harvard Business Review. pp. 1-16.
Hi Brenda,
ReplyDeleteIn my blog post this week, I also shared an example of a "strategic alliance" that relied heavily on communication and integration for collaboration. I might be wrong, but I think the importance of communication is highlighted by Gulati (1998) under the "governance of structures" since this is the umbrella for coordination (p.212). Kanter (1994) also includes "information" or having open communication with partners as key to a successful relationship (p.100). However, you are right in that it is not clearly listed as one of the steps in the selection criteria. I think this important function is hidden in "infrastructure for learning" section (Kanter, 1994 p. 107) and throughout the case studies. Since it's so important to the success of alliances, it really makes sense to have it more prominently highlighted.
Thanks for sharing another interesting article.
Adriana
Nice post, Brenda. This reading seems to be a nice complement to those we read this week. Like Adriana said, I do think communication was central in Kanter's (1994) article. For example, she writes, "Companies with strong communications across functions and widely shared information tend to have more productive external relationships" (p. 107).
ReplyDeleteAs this week's readings demonstrated, communicating trust is also an important element to alliances. Did Butler (2010) take this into account? If not, how do you think trust can be communicated in alliances?
Thanks for the comments Adriana and Courtney. I hear what you say about communication being mentioned in the articles for this week. I believe Butler provided an expanded perspective on how important communication is to ensuring an alliance’s success.
ReplyDeleteCourtney, in response to your question, Butler (2010) does address the necessity of trust in an alliance. His focus, again, is on the communication advantages of trust. Interpersonal trust is necessary so those involved may feel confident in asking questions to ensure complete understanding (Butler, 2010, p. 709). Butler (2010) also states that quality communication can built trust and confidence between the organizations (p. 707).
As I read the other posts, I know I am not the only one intrigued, but not surprised, by how closely business alliances mirror personal partnerships. Both trust and communication are essential ingredients in both.
Nice post, Brenda. You have taken a very important element of the relationship side or alliances and melded them with communication-specific "navigational aids," that are vital to corporate collaboration, as well as interpersonal relationships within those collaborative environments.
ReplyDeleteFrom your comments, it is obvious that you think along the same lines as I do. With my personal/professional experience within large corporations that have alliances with other companies, one of the biggest challenges I faced as a manager was being able to build personal relationships within the context of the alliances we had. This was especially evident with the company I recently departed. The roadblocks I faced were structurally-based, both within the company I worked for, and at the "control point" that had been set up by senior management. Organizational control prevented those important interpersonal relationships from growing across the alliance boundaries. This was likely, in hindsight, a form of "controlling the message." I believe this was a result of the company, while large, being a privately-owned, family-based corporation. I think this situation negatively impacted our organization's ability to build strong bonds of trust and information-sharing within the company, and across and into our vital alliances.