How Two Oil Companies Used The Breakout Strategy Process To Initiate a Profitable Joint Venture


A Breakout Strategy Process for a two-company team exploring a potential joint venture between a US and Canadian oil company, where all previous attempts to forge a viable, mutually beneficial JV strategy had failed.

The Opportunity

For several years, the top executives of two oil companies believed there was strong potential for a profitable joint venture between two refineries, one owned by each company. One company was the majority owner of the other, and the refineries, which were close together, seemed to have complementary strengths and disadvantages. However, three efforts over the past four years, using cross-company task-forces and/or expert industry consultants, had failed to find enough synergies to create a viable JV. Now, the Chairmen of the two companies had mandated a final look that would determine once and for all whether a profitable JV was possible.

The Project

Because of a successful strategic planning project with one of the two companies, the team assigned to the project asked us to design and facilitate a series of three one-day meetings to attack the problem. The team consisted of four upper-middle managers, two from each company. They wanted this assistance because they knew they knew they had to think “out-of-the-box,” because they needed each company’s “voice“ to be fully heard, and because needed to move very rapidly. As it turned out, each company had different views on the future environment and different biases about what strategies might work.

The Result

In just three meetings, the team had a breakthrough. After a number of previous attempts over four years had failed, this small team came up with a new set of interrelated short-term and long-term strategies (and a corresponding cost/benefit analysis) that made a mutually beneficial JV a reality. The overall payoff: New revenues and savings that ran to many millions of dollars a year.

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