Presented by Matthew Chatterton & David Axford January 2007

1. Presented by Matthew Chatterton & David Axford January 2007 Socia 2006 Business Partnerships Survey

2. Contents Methodology Profile of participants and the market Making partnerships work Cultural fit Sharing and maintaining control Initiatives, capabilities & advice Partnership Summary

3. Methodology • A total of 92 telephone interviews conducted by Ipsos MORI • All participants personally involved in establishing/ managing a long term collaborative business partnership • All large public/private sector organisations • Coverage • 51 public and 41 private sector companies surveyed • Outputs • Topline data; verbatim listings; presentation of findings; PR support • Fieldwork: 2 November – 22 December 2006

4. Profile of participants & the market

5. List of participating organisations (1)

6. List of participating organisations (2)

7. Sector splits and job functions Transport Retail/finance Central government Health/NHS IT/technology Local government Construction 55% PUBLIC SECTOR 45% PRIVATE SECTOR Job functions • 17% FDs - 14% HR/personnel directors • 22% IT/tech directors - 47% ‘other’ directors (incl. CEO, operations, planning) Base: All (92)

8. A significant minority (1/3) have over 20 ongoing partnerships Q4 Approximately how many partnerships is your organisation in at the moment? None 1 - 5 6 - 10 11 - 15 16 - 20 Over 20 Don’t know Mean = 12.7 partnerships Base: All (92)

9. Two-thirds expect partnership activity to increase Q5 Do you think that the amount of partnership activity your organisation is involved in is likely to increase or decrease over the next five years or will it stay the same? 67% INCREASE Increase substantially Increase a little Stay the same Decrease a little Decrease substantially Don’t know Base: All (92)

10. Collaborative partnerships seen as key to current and future success Q2 How important do you feel collaborative partnerships are to the success of your organisation? Q3 And how important do you feel they will be to the success of your organisation in five years’ time? Not very important Fairly important Not at all important Very important Essential Not important Important Now 85% 5 years time 91% Base: All (92)

11. The average partnership is around 5 years long Q6 We realise that this may vary quite widely, but what is the average length of your organisation’s current or proposed collaborative relationships? Under 3 years 4 – 6 years 7 – 10 years 11 or more years Don’t know Mean = 5.8 years Base: All (92)

12. Making partnerships work

13. Having a common purpose and shared objectives seen as the main success factor Q7 What would you say are the most important factors in building successful partnership between two organisations? TOP 10 MENTIONS A common purpose & mutual/shared objectives Good understanding and acceptance of each other’s culture Good personal relationships Trust/openness/honesty Effective communication systems The right contract and performance measures A willingness at all levels to solve problems together Clear accountabilities Cost/value for money Clear decision-making authorities Base: All (92)

14. The greatest overall focus has been on governance and operations…. Q8 Thinking about the partnerships you have been involved in, typically how much effort has been focused on each of the following general areas….? (a) Governance (by which I mean contracts, decision-making and control) (b) Operations (that is, management information, service levels and learning) (c) Behaviours (such as leadership, problem solving, cultural compatibility) Not applicable None at all Just a little Fair amount A great deal Governance 89% Operations 93% Behaviours 64% Base: All (92)

15. …but behaviours is recognised by most as offering the greatest additional value Q9 Thinking about these three elements of collaborative partnerships - governance, operations and behaviour – in which ONE do you think organisations could realise the greatest additional value by focusing more closely on it? Governance Operations Behaviours Don’t know Base: All (92)

16. Shared values seen as underpinning successful governance Q10a What specific aspects of governance should organisations focus on? MOST FREQUENT MENTIONS • Ensure values are appreciated/shared (36% or 5 mentions) • Better focus on objectives (29% or 4 mentions) • Building relationships/partnerships (21% or 3 mentions) • Mutual understanding (21% or 3 mentions) Mutual values to ensure shared values are appreciated.. secondly [that] the right people are in place with the right skills…and thirdly, openness [Local government] Have a well-established set of requirements before entering into an agreement. They should be managed throughout the agreement and moderated as required [Construction] Base: All mentioning governance as element where organisations could realise greatest additional value (14)

17. Continued and consistent focus on objectives needed for operations to work properly Q10b What specific aspects of operations should organisations focus on? MOST FREQUENT MENTIONS • Better focussing on objectives (30% or 8 mentions) • Building relationships/partnerships (22% or 6 mentions) • Mutual understanding (19% or 5 mentions) • Good communication (15% or 4 mentions) Understanding them better – it’s very broad and depends on the client. Focus on cost efficiency and better ways of doing things [Finance] The partnership is over a long period of time. It is very easy for the focus to slip – one starts with good intentions but you must keep focussed throughout the duration [Central government] Base: All mentioning operations as element where organisations could realise greatest additional value (27)

18. Building relationships seen as demanding but vital to success Q10c What specific aspects of behaviours should organisations focus on? MOST FREQUENT MENTIONS • Building relationships/partnerships (56%) • Mutual understanding (35%) • Good communication (17%) • Ensure values are appreciated/shared (15%) By looking at the rewards and benefits and minimising the pain [Construction] It’s really quite bog-standard stuff, like values and keeping promises, along with openness and integrity…also the ability to acknowledge when you have done something wrong and work to fix it [IT/technology] It comes back to leadership and clarity of purpose [Local government] Base: All mentioning behaviours as element where organisations could realise greatest additional value (48)

19. Cultural Fit

20. Cultural fit is significant part of selection criteria for most Q12 When selecting an organisation to partner with, how significant is the fit between their culture and the culture of your own organisation, as part of the selection criteria? 85% SIGNIFICANT Very significant Fairly significant Not very significant Not significant at all Not applicable Base: All (92)

21. A range of ‘hard’ and ‘soft’ analysis undertaken to test cultural fit Q13 How do you analyse the cultural fit of a potential partner? Understanding them/their culture Communication/general conversations/face-to-face meetings Analyse the partner by how experienced they are Look into their history/track record What their values are Analyse the partner by looking at their attitudes Amount of effort they’re willing to spend on relationship Policies Size of the company Other Don’t know Base: All who think cultural fit is very/fairly significant part of selection criteria (78)

22. In their own words Q13 How do you analyse the cultural fit of a potential partner? Illustrative verbatim comments Face to face meetings, understanding their ethos [Transport] Partly by researching and ensuring the information is sound and then taking the time to consider the partner’s historical track record and experience….and if necessary engage with third party assistance [Local government] Looking at their methods…at whether they have worked in our industry…Personal empathy [with] people involved [Finance] Analysis. The size of the company - but it’s difficult to asses without coming face to face [Central government]

23. Sharing & Maintaining Control

24. Two-thirds have found handing over control of some operational functions difficult… Q14 Establishing partnerships often involves giving up some direct control over certain aspects of your operations. How easy or difficult do you think your organisation has typically found the process of giving up control? Very easy Fairly easy Neither/nor 63% DIFFICULT Fairly difficult Very difficult We didn’t give up any direct control Don’t know Base: All (92)

25. …and this varies by organisation size and type Q14 Establishing partnerships often involves giving up some direct control over certain aspects of your operations. How easy or difficult do you think your organisation has typically found the process of giving up control? Difficult Easy All < 5,000 emps 5,000+ emps FDs IT/technology HR/personnel Base: All (92); <5,000 employees (51); 5,000+ employees (40); FDs (16); IT/tech (20); HR/personnel (13)

26. Previous experience and internal cultural help in process of relinquishing some control Q15 Why do you think that process is typically easy? • We’ve had a good experience/been through this before (5 mentions) • It’s a matter of culture (4 mentions) • Building trust (1 mention) We have previous experience….by the time you release control you know the key performance indicators you share….I know by looking at the key performance indicators that things are under control [Finance] If you get the relationship established the right way it’s easy [and have] a clear shared vision of what you want to do [Central government] It’s the culture within our business. It’s how people are taught and trained. We want to be in partnerships [Construction] Base: All who think process is easy (14)

27. Difficulties appear to stem from deep-seated concerns (most of which are rational) Q15 Why do you think that process is typically difficult? • Control element/giving up control (48%) • It’s a matter of culture (36%) • Building trust (7%) • Change in management (3%) [It’s] cultural. One wants to preserve and control, keep perceptions of the brand [Retail] The people who run the firm are control freaks! [Finance] There is accountability for funding and all governments need to know what they are getting [Central government] That we don’t have a 100 percent understanding of the process - in other words we are not sure what we are giving up [Finance] Base: All who think process is difficult (58)

28. ‘Hard’ measures used in nearly all cases but more limited application of ‘softer’ metrics Q16 Which, if any, of the following types of performance measures do you have in place to assess the progress of the partnership? Financial measures Activity measures Outcome measures Relationship measures Other Don’t know Base: All (92)

29. Nearly all concede that earlier planning helps mitigate later operational issues Q11 To what extent do you agree or disagree with the following statement: most problems experienced during the operation of a partnership could have been avoided by more careful planning at the set-up stage 86% AGREE Strongly agree Tend to agree Neither/nor Tend to disagree Strongly disagree Don’t know Base: All (xx)

30. Initiatives, Capabilities & Advice

31. Meetings/workshops and in-house training are main initiatives applied Q18 How, if at all, have you addressed the challenges of collaborative partnerships and built partnering capability? TOP MENTIONS Regular meetings/seminars/workshops Offered in-house training to existing staff Building good relationships Set up a specialist in-house team to manage partnerships/alliances Not undertaken any initiatives/ changed practices etc. Used outside consultants as advisors/coaches Sent people on external training courses Base: All (92)

32. Effective communication and working on the relationship help to prevent ‘blame response’ Q20 How have you avoided slipping into a more confrontational approach or adopting a ‘blame response’ when serious issues arise? TOP MENTIONS Good communication Having/developing good relationships/partnerships Focus on what went wrong/learning from mistakes Having strong governance Having the right framework in place at the set-up stage Being open/honest Being clear/up-front Have not avoided this/still many issues/problems Base: All (92)

33. In their own words Q20 How have you avoided slipping into a more confrontational approach or adopting a ‘blame response’ when serious issues arise? Illustrative verbatim comments Good communication and being open about issues. Also being consistent on the ground you can’t give away and being able to compromise on the vast area of middle ground [IT/technology] Seriously hard work on both sides [Central government] Focus on the facts. Look at alternative perspectives - we’ve bought in a brokering person. [I] think it’s a challenge for the partnership [Retail] Have very clear and well- constructed contracts. A good level of communication from the earlier stages [Construction]

34. Improved relationship management/collaborative leadership capabilities seen as particularly useful Q17 Organisations require a range of qualities or capabilities in order to partner successfully. Which, if any, of the following qualities/capabilities would you like to have had more access to in setting-up and running a collaborative partnership? Relationship management 5,000+ emps=73% Collaborative leadership Programme management 5,000+ emps=60% Facilitation and coaching skills Dispute resolution Commercial management Have the necessary qualities Base: All (92)

35. Developing a deeper understanding and ensuring objectives are truly shared seen as cornerstones of successful partnering Q21 What would be the key pieces of advice that you would give to someone about to take on a role that involved managing a collaborative partnership? Develop good understanding/sharing objectives/goals/ business Ensure greater clarity/be more open Take more time building relationships Structure governance Devote more time and effort Ensure good communication Ensure accountability is right Other Base: All (92)

36. In their own words Q21 What would be the key pieces of advice that you would give to someone about to take on a role that involved managing a collaborative partnership? Illustrative verbatim comments Do a lot of talking [NHS/Health] Make sure the foundations are right, basic principles are in place - joint aims/ joint goals [Central government] Get as much advice as you can before you start. Ensure both sides have a clear understanding of what to achieve from the partnership [Central government] Don’t think it will be easy - treat it like a marriage where you have to work at it to get the long term results and benefits [Construction] Work on the relationships and ensure that accountability is right [IT/technology]

37. Partnership

38. Partnerships are not seen as a ‘passing fad’ Q19 To what extent do you agree or disagree with the following statement? (a) “Partnerships are a passing fad that won’t have a long term place in the world of work” Strongly disagree Strongly agree Tend to agree Tend to disagree 92% DISAGREE Base: All (92)

39. Over 9 in 10 see partnering as a key management tool for future success Q19 To what extent do you agree or disagree with the following statement? (b) “Partnering will be a key management tool for success in the future” Strongly disagree Strongly agree Tend to agree Tend to disagree 92% AGREE Base: All (92)

40. Most do not see partnerships as a ‘necessary evil’ which must be endured Q19 To what extent do you agree or disagree with the following statement? (c) “Partnerships are a necessary evil and we have to learn to live with them” Strongly disagree Strongly agree Tend to agree Tend to disagree 67% DISAGREE Base: All (92)

41. 9 in 10 disagree that the benefits of partnerships rarely outweigh the costs Q19 To what extent do you agree or disagree with the following statement? (d) “The benefits of partnerships rarely outweigh the costs and should be avoided where possible” Strongly disagree Strongly agree Tend to agree Tend to disagree 90% DISAGREE Base: All (92)

42. Over 9 in 10 agree that collaboration will be a vital foundation for long term global economic success Q22 To what extent do you agree or disagree that the ability to collaborate with others in different businesses and different cultures will be a vital foundation for long term success in a globalised economy? 1% Strongly agree 92% AGREE Tend to agree Neither/nor Tend to disagree Strongly disagree Don’t know Base: All (92)

43. Nearly 9 in 10 agree that partnering can transform how well we meet future business and social goals Q23 To what extent do you agree or disagree that partnering and collaboration between organisations has the potential to transform our ability to meet business and social goals in the future? Strongly agree 88% AGREE Tend to agree Neither/nor Tend to disagree Strongly disagree Don’t know Base: All (92)

44. Extra analysis

45. A common purpose/shared objectives and having close relationships with trust/honest seen as main success factors Q7 What would you say are the most important factors in building successful partnership between two organisations? TOP 10 MENTIONS A common purpose & mutual/shared objectives Good personal relationships/trust/openness/honesty (combined) Good understanding and acceptance of each other’s culture Effective communication systems The right contract and performance measures A willingness at all levels to solve problems together Clear accountabilities Cost/value for money Clear decision-making authorities Base: All (92)

46. No significant differences in actual implementation of performance measures (eg relationship measures) Q16 Which, if any, of the following types of performance measures do you have in place to assess the progress of the partnership? Financial measures Activity measures Outcome measures Relationship measures All respondents Other Mention “good personal relationships” * Do not mention “good personal relationships” * Don’t know * Q7 ‘Good personal relationships’ as one of) the most important factors in building a successful partnership (spontaneous) Base: All (92)

47. A slightly higher proportion of those saying giving up control was ‘easy’ do not see partnerships as a ‘necessary evil’ to be endured Q19 To what extent do you agree or disagree with the following statement? (c) “Partnerships are a necessary evil and we have to learn to live with them” Strongly disagree Strongly agree Tend to agree Tend to disagree All respondents Those who found giving up control ‘easy’ * Those who found giving up control ‘difficult’ * * Q14 How easy or difficult has your organisation typically found the process of giving up control? Base: All (92)

48. Summary

49. Summary (1) • Collaborative partnerships seen as “essential/very important” to their success by around 9 in 10 organisations (now and in the future) • A third have 20+ ongoing partnerships at the moment • Two-thirds expect an increase in partnership activity • More effort is focussed on governance and operations than behaviours • But behaviours seen as offering the best way to add value • 85% say cultural fit is a “significant” part of their selection criteria • Two-thirds have found giving up control “difficult” BUT most have performance measures in place (except relationship measures) AND 86% agree that more careful planning during set-up could have prevented operational issues

50. Summary (2) • Two-thirds would have liked more access to collaborative leadership resources in the early stages of their partnership(s) • Among the largest organisations the need is even more widespread • Getting ‘under the skin’ of the partner organisation – understanding their goals, culture and objectives – is the main advice to others considering collaborative partnerships • Partnerships are seen as ‘here to stay’ by 9 in 10 and are seen to be a key management tool for success by the same proportion • There is strong disagreement (90% disagree) that the benefits of partnership rarely outweigh the costs and should be avoided • Partnerships are also felt to offer a wider role for the future – in terms of global economic success and even for helping us to meet social goals