Wedding HR to Strategic Alliances

By Sunoo, Brenda Paik | Personnel Journal, May 1995 | Go to article overview

Wedding HR to Strategic Alliances


Sunoo, Brenda Paik, Personnel Journal


You've seen them off the highway. You've probably even fidgeted behind one at the nearest pit stop: The long-haul trucker who's tying up the pay phone. He could be calling home. But most likely he's on hold, awaiting his fleet manager's next road assignment. Wouldn't it be great if we could just eliminate the frustration on his end, the manager's and our own? That's just what J.B. Hunt Transport Services, Inc. and IBM did in 1993. A strategic alliance between the two companies produced the on-board computer--a satellite technology that looks like a cellular phone and simplifies the trucking industry's ability to track and assign its drivers while expanding IBM's commercial market.

In addition, Armonk, New York-based IBM also introduced a new software program called Micromap(R) to simplify the logistics manager's job by sorting through the difficult process of matching loads to truckers. This enabled the computer to consider more than 90 different assignment possibilities. "[The computers] also give us the ability to communicate back and forth with the drivers every minute and at any place in the world," says Steve Palmer, executive vice president of human resources and risk management for Lowell, Arkansas-based J.B. Hunt. Already, the technology shared through the alliance has reduced the number of driving miles and has contributed to getting employees home on time. Moreover, the onboard computers have helped to reduce fatigue and the number of highway accidents, he says.

Companies are looking for ways to share resources and opportunities.

The strategic alliance between J.B. Hunt and IBM is only one of thousands springing up in the business world every day. One of the most visible partnerships announced recently is the one between Microsoft Corp. and DreamWorks, the entertainment studio founded by producer Steven Spielberg, former Disney executive Jeffrey Katzenberg and music mogul David Geffen. Others include Schering-Plough Corporation and Corvas International; Motorola and various enterprises in China; Amoco and Enron corporations. The list goes on. Today's strategic alliances are cooperative arrangements between two or more companies that want to develop a win-win strategy. Primarily, both sides want to gain access to untapped geographic markets and resources, exercise more control and share risks. They can be created in response to a variety of needs and can take the form of anything from a technology licensing agreement to a full-blown joint venture. Both parties, essentially, want to reduce the time needed to get product to a greater market at the lowest possible costs. According to global management and technology consulting firm Booz.Allen & Hamilton, more than 20,000 new alliances were formed between 1987 and 1992. Nearly 6% of the revenue generated from the top 1,000 U.S. firms now comes from alliances. But about 40% of U.S. alliances today are still considered failures because they don't achieve their objectives, says John R. Harbison, vice president for Booz.Allen, based in Los Angeles.

No one knows exactly why they're failing, but industry analysts, business consultants and organizational development specialists are beginning, at least, to understand their nature, to avoid some of the traps and to identify the keys to an alliance's success. Some also advocate a stronger presence of human resources executives. Because most strategic alliances are initially driven , by CEOs and marketing and sales executives, HR executives have been underrated and ignored in the process. But, as those involved in alliances are learning, HR . professionals--such as the ones from Dresser Industries, J.B. Hunt Transport, Inc. and Lau Technologies--can contribute to an alliance's success at any stage: They can help define the two partners' culture, assess the alliance's business needs and map out a common language. In addition, HR can take responsibility for the usual compensation and benefits issues that would apply to the alliance employees. …

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