STRATEGIC ALLIANCESStrategic alliances are cooperative agreementsbetween two or more companies to worktogether and share resources to achieve acommon business objective.
WHY STRATEGIC ALLIANCE..?• Sharing Resources like products, distribution channels, manufacturing capability, project funding, capital equipment, knowledge, expertise, or intellectual property.• To create Synergy – to gain competitive advantage
TYPES OF STRATEGIC ALLIANCE• Joint venture - Legally Independent Company• Equity strategic alliance - own different % of the company• Non-equity strategic alliance - A Contractual - Relationship• Global Strategic Alliances - working partnerships between companies – across national boundaries or May be between foreign government.
ADVANTAGES• Allowing each partner to concentrate on activities that best match their capabilities.• Learning from partners & developing competences that may be more widely exploited elsewhere.• Adequate suitability of the resources & competencies of an organization for it to survive.
DISADVANTAGES• Technology – Low Cost Manufacturing. – US & Japanese Companies• Organization Culture.• Competition – How to Compete in future.
KEY FACTORS OF STRATEGIC ALLIANCESelect the proper partners for the intended goalsShare the right informationNegotiate A deal that includes risk and benefitanalysis (not necessarily equal) for all sides.Come to a realistic agreement on the time tomarket and corporate expectationsMutual, flexible commitment on whatsappropriate to change, measure and share withineach partners culture
PROCESS OF STRATEGIC ALLIANCE Setting alliance strategy Selecting a partner Structuring the alliance Managing the alliance Re-evaluating the alliance
STARBUCKS• Barnes and Nobles bookstores in 1993• In 1996 - Pepsico to bottle distribute and sell the popular coffee-based drink Frappacino.• A Starbucks-United Airlines alliance has resulted in their coffee being offered on flights with the Starbucks logo on the cups• Kraft foods has resulted in Starbucks coffee being marketed in grocery stores.
APPLE LTD• Apple has partnered with Sony, Motorola, Phillips, and AT&T in the past.• Apple has also partnered more recently with Clearwell in order to jointly develop Clearwells E-Discovery platform for the Apple iPad. E-Discovery is used by enterprises and legal entities to obtain documents and information in a "legally defensible" manner.