The Coming into Force of the Contract


partners from the group of considered companies. The basic questions that must



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Business Project Management and Marketing Mastering Business Markets-201-403


partners from the group of considered companies. The basic questions that must
be asked is: Which partner best meets the requirements for a successful order
acquisition and/or management and the requirements for the application of any
proposed form of cooperation? This question must be reviewed with regard to the
following summarized aspects:
1. Resources and capacities of a potential partner:
• Technical
• Organizational
• Personnel
• Financial and
• Know-how-related (including sales/marketing know-how)
• Reputation/standing
The following must be clarified: Where and how can a partner help
• in acquisition,
• in financing,
• in local contacts,
• in project management and
• in after-sales services?
2. Customer specifications and preferences:
The selection of coalition partners often has to consider mandatory customer
specifications. In some cases, the customer specifies consortium partners or even
subcontractors (in international business this is referred to as “
named
subcontractors”
, “
nominated subcontractors”
). The reasons for these kinds of
specifications from the customer’s perspective include existing business
relationships or the special capacities of the relevant supplier. This particularly
occurs in international marketing, if customers require the fulfillment of
suborders in their own country
(
¼
Local Content;
if this relates to production:
Local Manufacturing)
. A review must also take place to confirm that the
considered partners meet the prequalification characteristics specified by the
customer. In some cases, certain partners are selected in order to jointly meet
prequalification criteria (Engelhardt and Gu¨nter
1981
, p. 126 et seqq.).
3. Performance and quality criteria:
• Quality, scope and limitation of supplies and service
• Local shares of the order/project (local content/local manufacturing)
• Services, esp. after-sales services
Project Cooperation
367


• Financing services
• Standardization (options)
• Rights of use, industrial property rights (patent licenses, etc.)
• Sales capacities (incl. location and branch issues)
• Availability of capacities, delivery deadlines
• Spare parts supply and
• Proposal design and presentation
4. Partner contacts and experiences with the customer, if applicable with their
consultants or in the customer country; references and reputation with the
customer, in the customer country, in third countries.
5. Additional qualities and expected behavior of a partner, etc.:
• Risk tolerance; risk distribution (e.g. liability issues)
• Division and allocation of tasks in acquisition and management
• Takeover of organizational functions (e.g. management/control)
• Distribution of costs
• Credit rating
• Currency
• Language and communication
• Conformity with the corporate policy and culture
• Compatibility with other partners and
• The partner’s political environment
6. Conditions of cooperation, e.g.:
• Possible types of contracts
• Intensity of the cooperation
• Partner relationship, exclusivity agreements, licensing
• Term of the agreements and
• Opportunities for attractive follow-up cooperation
7. Own experience with certain partners (e.g. with regard to the pricing behavior)
8. Competition situation and Competitive strategy perspectives
9. Risk considerations with regard to the considered partner
The result of the review of all the above considerations will allow the group of
potential partners to be narrowed down and concentrated. This group can then be
further reduced by negotiations. The decision on the cooperation partner then
moves to the phase of contractual specification of the cooperation.
4.4
Cooperation Risks and Contracts
Project cooperation and other forms of cooperation enable barriers to access to be
overcome and strengths to be bundled; however, they also involve typical risks.
Cooperation primarily serves to diversify and limit commercial risks. However, it
also introduces additional, new risks. An example is the risk of default of a ‘weak’
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