A Network of Alliances case analysis

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A Network of Alliances case analysis

By | April 2013
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MGT 362
Mei Fang Sung (0563365)
Corning Incorporated: A Network of Alliances case analysis
From 1980 to 1988, there are 2000 major alliances happen between U.S. and European. Most of the companies wanted to take advantage on low cost, new technology transmission, and sharing the risk. However, a U.S.-based survey point out that 57% of alliances had not succeeded between 1975 and 1985. There are several reasons, insufficient trust, conflict business goal, and chaos hierarchy organization. Corning is one of the most successful companies to create their alliances network. The reason why they were doing this is because they don’t have enough skill to transfer their innovation to profit. Therefore, they need to make alliance with some companies who has outstanding performance in the area that related to Corning Strategy Wheel. Corning made a network of alliances. That means each operation and alliance can share their technology skill more fluently without too many hierarchical restrict. Here, we will analysis three proposal that may influence their future. First, Gibson proposed that he wants to sell all of the share back to Ciba-Geigy and use those fund ($150 million) to invest in three laboratory testing companies. In my opinion, I do think this is a good way to thrive their business in the Laboratory sciences. Ciba Corning had a pretty good performance in 1988 but the return in the future would be low. In addition, the laboratory sciences has poor CAGR because they used to focus on merely medical diagnostics. Corning should consider about selling the rest of the share in Ciba Corning and investing in higher market growth rate industry, such as laboratory testing industry. If we take a look at Laboratory Testing Industry in 1988, we know that the market growth rate were between 5% and 20%. This will consolidate Corning’s Laboratory Sciences strategy. Also, they gained more new technology skill to share with their network organization....