1999 Farm Credit System
National Directors Conference
Tuesday September 14th
10:30 - 11:45 a.m.


Alliance, Not Competition
Using the logic of alliance and collaboration to grow and thrive
in a changing business environment


Robert M. Tomasko
Author · Consultant · Speaker




I. Old myths vs. new realities

· Getting ahead means getting bigger

· The best products always do best in the marketplace

· Markets always find a point of equilibrium

· Successful competitors win every battle

· For my business to win, yours must loose


II. The case for collaboration

· Business is seldom a zero sum game played only once

· In the long run, strategies that do-well-for-yourself outperform ones aimed at beating-the-

· Sometimes the best way to do well is to let others, including competitors, succeed

· Your fortune may be more interdependent on your competitor's than it appears

· Competition is increasingly among networks and alliances of companies rather than only
among individual companies

· Companies don't only compete, they also complement

· A business complements yours if customers value what you have more when they have
what the other business offers, than when they have only what you provide

· Companies grow markets through complementing each other (win-win competition)

· Companies divide markets by competing (lose-lose competition)

· Cooperative efforts create value by sharing:

- risks, costs, knowledge, relationships

· Collaboration with competitors provides:

- benchmarks to guide your ongoing improvement

- insights into how they will behave if the alliance ends

- standards that can help grow the market

- possibilities to create complementary ventures that can increase demand

· The existing legal and regulatory framework sets the ground rules for collaboration with

· Sustainable collaboration builds markets by adding value to customers

· In the short run collaboration is a fast way to acquire new products, markets and skills

· In the long run collaboration provides:

- opportunities to learn from your partner

- a trial marriage


III. Making alliances work

· Have clear short and long-run objectives

· Know what you have to offer and what you need

· Carefully understand the objectives of your partner

· Neither party should be able to accomplish alone what both can together

· Continually monitor how changes in the market change everyone's objectives

· Establish and monitor specific performance requirements

· Avoid the "wallflower" syndrome

· Avoid one-sided relationships - providing a beachhead for your competitor to steal your

· Define off-limits and other ground-rules

· Avoid "love at first sight" - conduct a phased-in courtship

- walk before you run - start small with limited joint activities

- make mid-course corrections - build the relationship on successes

· Collaboration involves both sides playing the roles of teacher and learner to share
information and smoothly integrate operations

· Add bandwidth (multiple points of contact) to the relationship

· Long-lasting partnerships manage the relationship, not just the deal

· Cement the relationship with integrity, mutual respect, and willingness to give-and-take

· Partners show tangible signs of long-term commitment through the resources they devote to the relationship

· Understand your competitive posture and that of your partner's




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