Before signing off on strategic partnerships, experts stress value of solid due diligence process
Excerpted from the July 2023 issue of University-Industry Engagement Advisor. UIDP members can view the entire issue here.
What do industry engagement managers look for when implementing a due diligence process with a potential strategic partner, and what key steps lead them to the decision point? Many are guided by a number of key “boxes” that must be checked off — while also recognizing that no two processes look exactly the same.
“There really isn’t one right way to do things; each institution has its own distinct culture,” says John Garnetti, managing director in the Office of Business Engagement at UW-Madison. “You should adopt a due diligence process that aligns with your culture.”
That seems to be a rule of thumb among engagement professionals, but there are certain steps that should be taken and certain issues to address in almost every case, they say.
“In the context of a strategic collaboration, in my mind a couple of elements are important, although there’s not necessarily one ideal due diligence process,” says Paul Nkansah, PhD, senior director of corporate partnerships at Johns Hopkins University. “Number one, risk assessment — trying to protect the reputation of our university. You also want to make sure you’re complying with federal and state laws. And third, [you must determine] whether this is a collaboration worth pursuing.”
“Due diligence, in my mind, is making sure there is good alignment between what industry is looking for and what Penn State has expertise in,” says Priya Baboo, senior director of corporate and industry engagement at PSU. Other key elements, she adds, are technical expertise and the ability to provide financial support.
As for how the process itself plays out, she continues, it’s important to “think more about identifying the intent — why you want to make this happen, why it’s important to you as an organization.” In addition, “understand where there is buy-in from leadership to make his happen, and how you align with not just objectives but big picture macroeconomics — all the things that are happening in industry related to the topic being discussed.”
During a series of conversations, says Baboo, “it’s critical to learn how open the industry partner is to [establishing] an ecosystem. We’re very much focused on whether we’re creating an ecosystem that benefits regional development, our internal stakeholders, and our start-up ecosystem. Make sure you’re able to bring in additional partnerships that will be beneficial to both parties. It’s a ‘rolling’ due diligence model — it’s not a one-time, one-and-done deal.”
Derek Newton, assistant vice-president for innovation, partnerships, and entrepreneurship at the University of Toronto, agrees. “We always want to work with partners who share our mission and understand that we are a public research institution — and creating knowledge and getting it out [into society] is important for us,” he says.