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Nexia Ebner Stolz


Alliances are more popular than acquisitions

The era of the lone wolf in the SME sec­tor is over: 94 per cent of small and me­dium-si­zed com­pa­nies in Ger­many have al­re­ady gai­ned ex­pe­ri­ence with stra­te­gic al­li­an­ces. 88 per cent are plan­ning to en­gage in al­li­an­ces in the fu­ture. These are two core fin­dings from Eb­ner Stolz Ma­nage­ment Con­sul­tants’ study, “Stra­te­gi­sche Al­li­an­zen. Wir­kungs­vol­les In­stru­ment oder über­schätz­ter Hype? Das sagt der Mit­tel­stand” (“Stra­te­gic Al­li­an­ces: Ef­fec­tive In­stru­ment or Over­ra­ted Hype? What the SME Sec­tor Has to Say”). The ma­nage­ment con­sul­tants sur­veyed 500 cor­po­rate lea­ders as part of the study. The ana­ly­sis in­clu­des the ex­pe­ri­en­ces seen in more than 300 al­li­an­ces.

The fi­gu­res show that, in the SME sec­tor, busi­ness co­ali­ti­ons are ef­fec­tively de­ployed in­stru­ments to make com­pa­nies fit for the fu­ture. To­day al­li­an­ces hold even grea­ter re­le­vance than mer­gers and ac­qui­si­ti­ons. In par­ti­cu­lar, the si­gni­fi­cant ad­van­ta­ges of al­li­an­ces in­clude lo­wer fi­nan­cial com­mit­ments, risk sha­ring and are re­la­tively easy to dis­mantle.

Alliances are more popular than acquisitions © Thinkstock

Col­la­bo­ra­ti­ons of­ten oc­cur in core areas

The study also ad­dres­ses the pre­con­cep­tion that al­li­an­ces are only sui­ta­ble for the en­tre­pre­neu­rial pe­ri­phery. Quite the con­trary: The SME sec­tor’s col­la­bo­ra­tive prio­ri­ties lie in purchasing (19 per cent), re­se­arch and de­ve­lop­ment (17 per cent), ma­nu­fac­tu­ring (17 per cent) and dis­tri­bu­tion (15 per cent).

Yet al­li­an­ces are not only po­pu­lar, they are usually crow­ned with suc­cess as well. 65 per cent of SMEs sur­veyed ra­ted the al­li­an­ces they had joi­ned hereto­fore po­si­tively and at­test to the mea­sura­ble im­pact these al­li­an­ces have had on cor­po­rate growth. Con­ver­sely, howe­ver, this me­ans that one-third of SMEs did not achieve the ob­jec­tives and ex­pec­ta­ti­ons they had set. The re­asons for this of­ten lie in their im­ple­men­ta­tion. Only a small por­tion (12 per cent) of these com­pa­nies fol­low cle­arly de­fi­ned pro­cess steps. Yet it is struc­tu­red, tho­rough im­ple­men­ta­tion that forms the ba­sis for a suc­cess­ful al­li­ance. This is es­pe­cially true with re­spect to the le­gal ar­ran­ge­ments. A well draf­ted con­tract can be cru­cial to a suc­cess­ful al­li­ance for­ma­tion for all par­ties in­vol­ved, and can pre­vent con­flicts and en­sure suc­cess in the long term.

Select part­ners care­fully

In any case, the study shows that an al­li­ance is not a sure-fire suc­cess. In­deed, there are nu­me­rous hurd­les to over­come in terms of their im­ple­men­ta­tion. The grea­test obst­acle, howe­ver, is dif­fe­rent cor­po­rate cul­tures. In ad­di­tion, part­nerships of­ten fail as a re­sult of com­pe­ting claims to lea­dership, a lack of con­sen­sus in terms of ob­jec­tives and stra­tegy, and in­ade­quate com­mu­ni­ca­tion. These points de­mons­trate just how im­port­ant the choice of part­ners is. Ne­vert­he­less, op­por­tu­nities are of­ten mis­sed. 37 per cent of re­spond­ents are loo­king for the right team player amongst their cur­rent busi­ness con­ta­cts. Howe­ver, they ra­rely turn to other ex­ter­nal re­sour­ces, such as as­so­cia­ti­ons, events, pri­vate net­works or con­sul­tant con­ta­cts. The pro­ba­bi­lity of fin­ding a com­pany per­fectly sui­ted to an al­li­ance in terms of their ex­per­tise, stra­tegy, ob­jec­tives and cor­po­rate cul­ture is the­re­fore much lo­wer.

De­spite all of the dif­fi­cul­ties in­vol­ved in their im­ple­men­ta­tion, stra­te­gic al­li­an­ces have ta­ken hold amongst small and me­dium-si­zed en­ter­pri­ses. Nine out of ten study par­ti­ci­pants are plan­ning to join forces with other com­pa­nies in the fu­ture as well. A ma­jo­rity of those will even go beyond al­li­an­ces. In the com­ing years, part­ners from ab­road will be un­der in­cre­asing de­mand. For ex­am­ple, 29 per cent of SMEs hope to col­la­bo­rate with busi­nes­ses in ano­ther EU coun­try; nearly the same per­cen­tage is also loo­king for a part­ner out­side of the EU.

All of the study’s fin­dings are avail­able in the spe­cial edi­tion of the cu­st­omer ma­ga­zine FO­RE­CAST.

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