Developing a framework to consistently assess the value of corporate alliances
Situation
The Corporate Alliances Team at a Fortune 100 company was interested in leveraging industry insights to formulate a methodology and framework to evaluate deals with corporate partners. Since the team did not have a way to value partnership deals, advertising trades were sometimes unbalanced, marketing assets were undervalued, and most importantly partner negotiations were weakened.
Approach
Accurate measurement is both art and science. Orchid Strategy Group was engaged to design a measurements framework to evaluate alliances. Our approach to developing a Corporate Alliances Measurements Framework was based on an assessment of value for what each party brings to the deal. We created a quantitative framework to understand the value of our client’s contribution to the alliance, the partners’ contributions, and finally an overall assessment of the “deal” to consistently evaluate the balance between our client and their partners. Orchid Strategy Group then created two prototypes for in-flight alliance partnerships to trial the measurements framework. Based on the learnings from the prototypes, we delivered a working version of the Corporate Alliances Measurement Framework to use as a repeatable process for all future alliances.
Solution
The solution included measurement tools with the flexibility to be used to assess, vet, and evaluate alliance partnerships as follows:
Client Contribution – inventory and quantitative market value of client’s marketing assets, i.e. “rate card”
Partner Contribution – strategically, yet objectively, assess partner alignment including brand, timing, customer targeting, etc. Also from a tactical perspective, quantify the value of the deal to our client’s customers as well as hard cost investment
Evaluation Report – executive summary detailing a disciplined and consistent measurement of the Alliance including partner’s contribution, client’s contribution, and in-market performance
Results
Our client has institutionalized the use of the measurements framework with internal team members. Implementation of the Alliances Measurements Framework has resulted in stronger negotiations and overall stronger partnerships.