Henderson strategizes for organization's good

January 31, 2000

BY MICHAEL KRAUSS

Name, rank and serial number: John C. Henderson, 52, Professor of Management Information Systems and director of the Systems Research Center at Boston University School of Management. Studied organizational behavior in government as a young academic; now an expert on Internet business strategy and partnerships. Wrote "Strategic Alignment: Leveraging Information Technology for Transforming Organizations," published in 1993 and picked by executives at IBM last year as one of the most influential papers on management and information technology in the last half-century.

Mantra: "Not all relationships are the same. Different relationships for different problems."

Why study partnerships? "It was an outgrowth of my interest in organizational studies, systems theory and technology." (Among his inspirations are anthropologist Margaret Mead, philosopher Thomas Kuhn, economist Kenneth Boulding and the work of IT strategists Warren McFarlan and Jim Cash.)

Why was the "Strategic Alignment" paper so important? "Some organizations couldn't afford to hire the best IT professionals and build state-of-the-art computer systems. They had to partner to get the best. The paper signaled a shift in organizational structure."

How does an organization foster a long-term relationship? Create mutual benefit, a joint commitment to processes and a predisposition to trust and cooperation.

How does an organization make it work day-to-day? Create organizational links, assure there are distinctive competencies and share knowledge and learning.

What do marketers need to know about partnerships? "There's a tendency to use the term 'partnership' when what you are really doing is relationship selling. Partnership is not about building a relationship with an individual so that you can sell
more-partnership is about creating an organizational capability that enhances organizational value. If you're talking partnership and living a transactional relationship, you could get into serious trouble."

Who are the Web's best partners?" Yahoo! does "quite well. They really have their act together." Also, FairMarket is "developing an understanding of how to work through relationships." These companies focus on "what's core. They establish a portfolio of relationships from transactional to true partnerships. (Partnerships) are investments. You have to… ask yourself, 'What's the ROI on the investment?' If the ROI is only increased sales and not value creation, you should question what you're doing."

Bottom line? "The key is to understand what kind of relationship you have and manage that relationship accordingly."

Michael Krauss is a partner with Diamond Technology Partners in Chicago.
He can be reached at news@ama.org.