Eli Lilly Alliance Strategy

While Lillys existing Alliance strategy is advanced and industry recognized, there
are few critical aspects that must be studied. Following list considers some of
those items and proposes suggestions on improving LAMPs governance structure.
1. Revenue growth opportunity: Build a dedicated team as part of OAM
that looks out for potential firms, that are innovators, to form new alliances.
The strategy is to identify those firms at early stages of their development
so that Lilly gains the competitive advantage by entering into exclusive
partnership.
2. International Expansion through Alliance and benefiting from
offshoring while leveraging intercultural skills: Lilly needs to build a
team of professionals, as part of OAM initiative, with diverse cultural
background so that post alliance conflicts can be readily identified and
resolved. A periodic transfer program of employees among different
subsidiaries might turn out to be effective to get the global perspective.
3. P&L at alliance level and individual projects: Since growth through
alliances is going to be a dominant strategy for Lilly, it should have separate
P&L responsibility at individual alliance and project level. Restructure OAM
to form a new vertical which will report its own financial data. All the
investment and cash flows from molecules developed through alliances will
report their data under this division.
4. Integrating Procurement into OAM Strategy: Leveraging existing
OAMs skill and knowledge base to form alliance with major suppliers of raw
materials. A great SCM (supply chain management) process in coordination
with alliance partner can help supply of drug to different markets in an
effective manner, improving continuous revenue source and maximizing
opportunity.
5. Role of OAM in negotiating stage (with feedback loop to help
business development): An early involvement of OAM in negotiation
stage can leverage revenue opportunities and can help strike friendlier
terms with the alliance partners. This will not only strengthen the
relationship, but also help cut down on potential alliances that have lower
potential.
6. Governance structure and modification to LAMP: One of the critical
challenges Lilly has faced in past arose from lack of shared strategic intent.
At times partners may have different business and strategic intent that is
hard to predict and hence synergies in later stages of project development
are negatively affected. In order to implement good governance and
achieve positive result (number of drugs approved and moved to next
stage), a strong accountability framework must be worked out so that
Alliance Champion, Alliance Leader, and Alliance Manager can closely
monitor the progress at alliances. They can be compensated well along with
top scientists from alliance for better performance.
Group - E
Soubhagya

Atul, Ayon, Deepti, Kuheli, Raj,

Eli Lilly Alliance Strategy

7. Creating value for OAMs and Alliances: Arrange internal networking

and knowledge sharing session among alliance managers/stakeholders to
help identify potential alliance issues and areas of improvement.

Group - E
Soubhagya

Atul, Ayon, Deepti, Kuheli, Raj,