Why too many alliances end in divorce

Participation in multi-firm alliances is increasingly essential for business success, and careful selection of alliance partners is a key to alliance effectiveness. Current advice on partner selection tends to focus on one prospective alliance partner at a time, on how well prospective partners fit the business strategy of the proposed alliance and on the operational workability of the alliance. This article extends that advice by giving greater attention to issues involving multiple prospective partners and issues arising from the long-term alliance strategy of the firm. With multiple prospective partners, selection issues are more complex than with just one prospective partner. The long-term alliance strategy of the firm focuses primarily on organizational learning of new technical, managerial and partnering skills and on improving organizational positioning in the evolving landscape of alliance activity. The logical connections between current advice and the extensions developed here are drawn. Learning and positioning opportunities, if seized, can contribute significantly to the long-term prosperity of the organization.