Preview

Strategic Alliances, National Responsiveness, Government Demands

Better Essays
Open Document
Open Document
1480 Words
Grammar
Grammar
Plagiarism
Plagiarism
Writing
Writing
Score
Score
Strategic Alliances, National Responsiveness, Government Demands
Strategic alliances:

Strategic alliances is an agreement between two or more companies to work together for a certain time in order to achieve some business objectives, help each other reach new technologies or to be able to build core competencies against other competitors.

The traditional view about Strategic alliances is that they were formed for:

- Defensive to protect profits
- Means for preempting competition
- Competitive and win - lose orientation.

While nowadays there is a current perspective about strategic alliance that goes beyond the traditional view and it consists of:

- Collaboration can create opportunities for all participants to be successful
- Can create multiple sources of competitive advantage
- Win † win orientation that relies on both collaboration and competition.

Strategic alliances could be formed for the following reasons:

1) Technology exchange: most of the recent strategic alliances (more than 50 %) are formed for technology exchange. this is done to obtain the necessary capabilities and resources needed for creating new technology or using some technologies to develop the companies’ competencies.

2) Global competition: strategic alliances are formed in order to allow the partners to build up more strength and be able to be more competitive in the global market against a common enemy better than each one fights alone.

3) Industry convergence: by this it means company gets together and become a single company in order to achieve more success in a certain industry.

Risk that faces strategic alliances:

Most alliances that work are done between two companies from industrial countries.

But even any kind of strategic alliance has some risks that might occur during this partnership:

- Strategic alliances are sometimes used by partners to build competitive advantages against each other, or might even make one partners stronger than the other that will manage to take more market share from him.

You May Also Find These Documents Helpful

  • Good Essays

    10. It is also observed that within the service sector strategic alliances are less common, but those between hotels, airlines and tour operator’s and between accountants and management consultants are increasing.…

    • 741 Words
    • 3 Pages
    Good Essays
  • Good Essays

    Strategic Alliance Report

    • 609 Words
    • 3 Pages

    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.…

    • 609 Words
    • 3 Pages
    Good Essays
  • Good Essays

    CHAPTER 8 note 1

    • 2433 Words
    • 9 Pages

    Strategic alliances are partnerships between two or more firms which decide they can better pursue their mutual goals by combining their resources—financial, managerial, technological—as well as their existing distinctive competitive advantages. Alliances—often called cooperative strategies—are transition mechanisms that propel the partners’ strategy forward in a turbulent environment faster than would be possible for each company alone. Alliances typically fall under one of three categories:…

    • 2433 Words
    • 9 Pages
    Good Essays
  • Satisfactory Essays

    Strategic Ppt

    • 298 Words
    • 3 Pages

    •Strategic alliances, joint ventures, and strategic account collaborations are example of cooperative relationships between independent firms. The Rationale for Inter organizational Relationships DRIVERS OF INTERORGANIZATIONAL RELATIONSHIPS The Various drivers of relationship fall into four broad categories: •Opportunities to enhance value by combining the competencies of two or more organizations.…

    • 298 Words
    • 3 Pages
    Satisfactory Essays
  • Good Essays

    The advantages of international strategic alliance are as follows; it is much more flexible to than an acquisition with respect to the degree of control enjoyed by both party. International strategic alliance may facilitate entry into a foreign market, or at least speed up your entrance into new markets. When a company decides to enter a market, it is wise to get a partner who knows that market or is from that market. Understanding the market can promise success for the business in the future. An alliance may be necessary because cooperation with or participation in a local company is a condition of trading in a particular country, or because the cooperation of a local partner will help to overcome barriers such as local regulatory, cultural and language difficulties. Secondly, an alliance helps one to gain new skills and technology. An alliance is to bridge a competency gap by accessing the skills of a strategic partner, the other partner will be looking for something else in return that may take the form of further technology transfer. Thirdly, an alliance allows firms to share the fixed costs and resources of developing new products, processes or services. Fourthly, it exploits new opportunities to strengthen your position in the market where your partner already has a foothold. Other advantages include it helps one to broaden a company’s business and political contact base, increase sales, enlarge the distribution channels, enhancing your image in the…

    • 1706 Words
    • 7 Pages
    Good Essays
  • Powerful Essays

    Life Is Beautiful

    • 16865 Words
    • 68 Pages

    Narula, R. & Hagedoorn, J. (1999). Innovating Through Strategic Alliances: Moving Towards International Partnerships and Contractual Agreements. Technovation, 19(5), 283– 294.…

    • 16865 Words
    • 68 Pages
    Powerful Essays
  • Good Essays

    Organizational Agility

    • 863 Words
    • 4 Pages

    A formal relationship created among independent organizations with the purpose of joint pursuit of mutual goals.…

    • 863 Words
    • 4 Pages
    Good Essays
  • Powerful Essays

    Controlling Case study

    • 17854 Words
    • 72 Pages

    Ireland, R.D., Hitt, M.A., & Vaidynanath, D. (2002). Alliance management as a source of competitive…

    • 17854 Words
    • 72 Pages
    Powerful Essays
  • Good Essays

    Strategic International Alliances (SIA) - SIAs, the other category of collaborative relationships, are sought as a way to shore up weaknesses and increase competitive strengths. Opportunities for rapid expansion into new markets, access to new technology, more efficient…

    • 464 Words
    • 2 Pages
    Good Essays
  • Powerful Essays

    Alliance Nissan & Renault

    • 2848 Words
    • 36 Pages

    The cross-shareholding model ensures that both partners have a mutual selfinterest and encourages each to pursue “win-win” strategies that benefit both.…

    • 2848 Words
    • 36 Pages
    Powerful Essays
  • Best Essays

    Strategic alliance

    • 1346 Words
    • 4 Pages

    Strategic alliance can be an advantage for companies. However, strategic alliance is hard to be managed as it caused a high number of failures. There are many factors causing the failure of strategic alliance. Different in perception, different in culture, trust issues and many other that cause alliances to fail (Robynhenderson101's Blog 2011).…

    • 1346 Words
    • 4 Pages
    Best Essays
  • Good Essays

    A Strategic Alliance is a 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. This form of cooperation lies between M&A and organic growth.…

    • 702 Words
    • 3 Pages
    Good Essays
  • Good Essays

    Strategic Alliances

    • 679 Words
    • 3 Pages

    In regards to horizontal strategic alliances, these involve firms that are in competition with each other who form an alliance together to compete against other competitors and although alliances are anti-competitive; anti-trust laws should be a main focus when product/s is sold in multiple markets (Sarkissian, 2013)…

    • 679 Words
    • 3 Pages
    Good Essays
  • Powerful Essays

    With information mobility, borderless business expansion and rapid updates of technologies, increasing competition for technology-based companies is a well accepted phenomenon. In order to cope with this phenomenon, more technology-based companies form alliances or M&As, because they expect positive returns of it. The expected advantages of forming alliances are sharing partners’ strength, dispersing costs and risks, acquiring resources, and learning from partners. Quite in line with the reasons for forming alliances, reasons for forming M&As are increasing market or political power, reaching economies of scope or synergies, and reducing of transaction and information costs. However, some studies reveal there are not only positive effects after forming alliances or M&As. Hagedoorn and Schakenraad (1994) have given us some examples : joint venture activity tends to have a significant negative impact or insignificant effects on profitability (a study of Berg et al. (1982)), and general mergers have shown a decline in profitability (a study of Meeks (1977)). Consequentially, companies need careful strategic management that might affect their ex post effects of alliances or M&As. For the strategic management, literature highlights that understanding motives and selecting suitable partners are crucial for forming alliances or M&As.…

    • 2024 Words
    • 9 Pages
    Powerful Essays
  • Good Essays

    An alliance is a longer-term partnership between two or more organizations. Alliance can be relatively loose and tactical through to strategy. A strategic alliance involves a reciprocal commitment by the various parties to longer-term collaboration which involves the mutual deployment of resources.…

    • 839 Words
    • 4 Pages
    Good Essays