The age of strategic partnerships.

• Author: Kelley, Gaynor N.

Here are a few key principles that have emerged as essential in managing a strategic partnership effectively.

If the 1980s were known as the decade of mergers and acquisitions, the 1990s may well become the era of strategic alliances.

In the past few years, corporations as varied as GE, Ford, Apple Computer, Time-Warner, AT&T, and Toyota have actively formed alliances with global partners. And a recent survey of America's fastest growing companies found that more than half the CEOs are involved in an average of three alliances. Two thirds of those CEOs believe their agreements are "very important" or are "critically important" to present and future growth.

The trend is not likely to change. Business is risky and unpredictable in today's global marketplace. The cost of product development and technology has skyrocketed, and expenses continue to mount with the changing demands of the 1990s business world: rigorous quality standards, less time-to-market, and tougher competition as more companies specialize on a piece of the product puzzle. And as the race to win market share accelerates, businesses are still faced with an uncertain world economy.

Confronting these challenges has been the focus of most corporations over the last few years. And for many companies, strategic partnerships have proven to be effective in speeding development, penetrating new markets, expanding their presence, enhancing productivity, and lowering investment risk. Partnerships have also provided shortcuts to production efficiency and quality, at the same time reducing time-to-market and time-to-profit pressures.

Like many solutions, cooperative relationships can vary based on the scope of the problem and the imagination of management. They range from traditional joint ventures to research contracts; from technology transfer agreements and consortia to licensing arrangements.

At Perkin-Elmer, the strategic partnership has been a critical tactic for growth over the last few years. In our experience, a partnership that is implemented effectively can quickly add know-how and competitive muscle to all kinds of business ventures. Most important, the right partnership can benefit both product development and financial performance of both companies for years to come.

Our partners include large multinational corporations that are leaders in their field, as well as smaller entrepreneurial firms with innovative techniques that benefit from our expertise in manufacturing...