6: Partnering as a Strategic Choice

Question 1

2 dims whereby companies should partner up

Answer 1

• highly shared customer based

- highly shared capabilities

Question 2

opportunity vs vulnerability matrix (for MnA?):

the 3 zones

Answer 2

high return on sales n low relative market share
=> vulnerability

low return on sales n high relative market share
=> opportunity

return on sales roughly proportional to relative market share
=> normative band

Question 3

the 2 key areas of a SWOT analysis

Answer 3

S-O => focus

W-T => de-risk

Question 4

Negotiation frameworks:

BATNA, ZOPA and reservation value

Answer 4

• best alternative to negotiated agreement
• zone of possible agreement = bw the 2 BATNAs
• reservation value = price at which you’ll walk away

Question 5

The 3 dimensions of dealmaking according to 3-D negotiation

Answer 5

1) tactics = people n processes: do not play hardball, act at the table
2) deal design = value n substance: (re-)design deals w lasting value
3) setup = scope n sequence: get away from table to create more favorable setup

Question 6

De-escalation in 3 steps n a principle

Answer 6

power > rights > interests

“Seek first to understand, then to be understood.” Stephen Covey

Question 7

Negotiauction def.

Answer 7

= negotiating w multiple ALTERNATIVE counterparties, e.g. buyers, at same time

Question 8

The 5 strategic Qs for a firm

Answer 8

1. what is our winning aspiration?
2. where will we play?
3. how will we win?
4. what capabilities are required?
5. what mgmt systems should be in place?