Strategic Alliance Report

Topics: Mergers and acquisitions, Strategy Pages: 2 (609 words) Published: November 12, 2008
Strategic alliance, joint venture, merger and acquisition refer to different forms of corporate partnering and the degree of participation in each other businesses. The joint venture and the strategic alliance have gained increasing popularity in corporate business models because of their relative flexibility, and at much less cost than a corporate merger or acquisition.

A Strategic Alliance is a formal relationship between two or more parties to pursue a set of agreed upon goals or to meet a critical business need while remaining independent organizations. Partners may provide the strategic alliance with resources such as products, distribution channels, manufacturing capability, project funding, capital equipment, knowledge, expertise, or intellectual property. The alliance is a cooperation or collaboration which aims for a synergy where each partner hopes that the benefits from the alliance will be greater than those from individual efforts. The alliance often involves technology transfer (access to knowledge and expertise), economic specialization [1], shared expenses and shared risk.

Types of strategic alliances
Various terms have been used to describe forms of strategic partnering. These include ‘international coalitions’ (Porter and Fuller, 1986), ‘strategic networks’ (Jarillo, 1988) and, most commonly, ‘strategic alliances’. Definitions are equally varied. An alliance may be seen as the ‘joining of forces and resources, for a specified or indefinite period, to achieve a common objective’. According to Yoshino and Rangan[2] the Internationalisation Strategies can be categorized using the model displayed at the right side. [edit] Stages of Alliance Formation

A typical strategic alliance formation process involves these steps: ·Strategy Development: Strategy development involves studying the alliance’s feasibility, objectives and rationale, focusing on the major issues and challenges and development of resource strategies for production,...
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