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„Fish swim in swarms to appear bigger and more dangerous for their enemies“
Humanity has long sought to unite around a common theme in order to better achieve goals with the strength of the community. In strategic alliances this is the same. Why it makes sense to swim in a swarm and what the global climate agreement has to do with alliances? “3 questions, 3 answers” and with Dr. Christian Liedtke, Head of Strategic Alliances at KUKA.
April 8, 2021
Reading Time: 3 min.
1. Why do companies form strategic alliances and how do we at KUKA decide which alliance to join?
„ Strategic alliances are nothing new. It is part of our DNA, we have been trying to ally ourselves with others since the Stone Age to better achieve our individual goals together. But it is not only a political move, it is a natural behaviour and a logical consequence. Fish swim together in shoals to appear larger and more dangerous to their enemies. This is similar to the situation in companies. But there is another facet to the whole thing: In such an alliance, we would also lose our identity and our individual competencies would become less important. This is why in the business world, companies form alliances in which they complement each other, i.e. they work together to offer customers a more comprehensive range of products and services, thus winning over customers.
Alliances make sense where local optimization of individual problems does not make sense, but where comprehensive, global solutions are needed. A striking example is the global climate agreement: If we bring CO2 emissions down to zero and all others do not, the world will not be helped much.
Alliances help where problems cannot be solved alone because of their complexity, where costs cannot be borne by one person, or where financial risks can simply be spread over several shoulders. But alliances also make sense where one can jointly drive the market in the right direction, as with the DIN standard for screws, which ensures that not everyone makes their own screw.
How do we decide which alliances we are active in? First of all, the chemistry between the companies involved must be right, you must have similar views, similar goals, similar customers, etc. Then the legal framework has to fit (e.g. antitrust law) and very important: we have to expect realistic advantages. This is the reason why we actively participate in certain initiatives, perhaps only listen to others and do not participate in others”.
2. Rights and duties: What can we demand as a member of an alliance and what do we have to contribute on the other side?
“In an alliance, you can only benefit through active cooperation. That covers not only the co-operation at Showcases or technical committees, it belongs also much politics, marketing and communication to it – thus activities, which do not serve the purpose indirectly.
In return we can expect a certain loyalty from the other members, i.e. results are not used against us, we work out solutions together and profit from them together. We profit from a certain prestige. For example, KUKA is still seen as a pioneer and innovation leader in the Industry 4.0 sector. However, we also have to pay membership fees and contribute through our work. This also means giving presentations for other members from which we may not directly benefit, or even standing at a trade fair booth and talking to interested parties who will never become our customers”.
3. What goals must be achieved for a strategic alliance to be successful and when is membership for KUKA considered successful?
“In the end, it is always about achieving business goals. That means: All measures must somehow be aimed at generating more sales or saving costs. This can be achieved directly by developing or increasing market share. Together, we get to talk to customers whom we could never have won on our own. We save costs by using technology from partners at low cost, or we benefit by having alliance partners develop features for us. Indirectly, multiplication effects through partners, i.e. recommendations, marketing, publications, are also a success. In short: It is our goal to develop further and deeper partnerships, to carry out projects together and to win customers and generate business together. If we succeed in this, our membership in a strategic alliance is a success”.
Equipping young talents for the future, getting them excited about STEM subjects and introducing them to new technologies is a mammoth project. At KUKA, we are working on this in various places and are in close contact with educational institutions and politicians to enable the younger generation to get to grips with new technologies.