An agreement between two or more parties to pursue a set
of agreed upon objectives needed while remaining
This form of cooperation lies between mergers and
Strategic alliances occurs when two or more organizations
join together to pursue mutual benefits.
8/12/2015 STRATEGICALLIANCE 6
Strategic alliance, cont.
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
8/12/2015 STRATEGICALLIANCE 7
One company takes over another and clearly established itself as the
new owner, From a legal point of view, the target company ceases to
exist, the buyer "swallows" the business and the buyer's stock continues
to be traded.
8/12/2015 STRATEGICALLIANCE 8
Two firms, often of about the same size, agree to go forward as a single
new company rather than remain separately owned and operated. This
kind of action is more precisely referred to as a "merger of equals."
Both companies' stocks are surrendered and new company stock is
issued in its place.
"Businesses once grew by one of two ways: grass
roots up, or by acquisition. In both cases, the
manager had control.
Today businesses grow through alliances, all kinds
of dangerous liaisons and joint ventures, which, by
the way, very few people understand"
8/12/2015 STRATEGICALLIANCE 9
51% of CEOs will enter into new alliances in the
coming 12 months.
8/12/2015 STRATEGICALLIANCE 10
PwC CEO Study January 2015
Types of Alliance (according to purpose)
1- Technology development alliance : engineering agreement ,
Technology commercialization agreement
2- Operation and logistic alliance : taking advantage of an exiciting
investment in an country by local firm
3- Marketing , sales , Service alliance : company make use of another
company infrastructure in a foreign market for its products to help
penetration of the foreign market
4- Multiple activity alliance : two or more types of alliance
while marketing alliance are single country alliance , as international
firm take on different allies in each country , technology , development
and operation alliance are usually multi country , can be done over
Micheal porter and Mark fuller
8/12/2015 STRATEGICALLIANCE 11
Booz-Allen & Hamilton 1999 Survey of Top 2000 US & European firms
8/12/2015 STRATEGICALLIANCE 12
One of the best approaches to grow globally, reaching out to larger
number of clients for products and services.
To develop new product offering through complementary products /
Access to local markets through partnering with local companies, which
provides better understanding of the market and culture.
8/12/2015 STRATEGICALLIANCE 17
Shared responsibility over the developed product / service.
Enable participating companies to focus on its own competitive
Reduced cost of accessing and operating in new markets.
Benefits to clients includes access to more convenient and wider range
Competitors may go into alliance for a common goal.
8/12/2015 STRATEGICALLIANCE 18
Can become ineffective if one partner is not performing as expected.
May result in limiting the flexibility of one partner in taking certain
decisions in his own benefit.
May require large human and financial investments to join / comply
with the standards of the alliance.
8/12/2015 STRATEGICALLIANCE 19
Considerations before joining
Is the alliance relevant to the mission and vision of the company, and its
scope of business.
Will the alliance help the company in accessing new markets.
Will the alliance help the company in improving its know-how.
Will the alliance help in increasing the company's revenues.
8/12/2015 STRATEGICALLIANCE 20
8/12/2015 STRATEGICALLIANCE 21
Alliances as Percentage of
Columbia University, European Trade Commission, Studies by BA&H,
AC.1983-1987, 1988-1993, 1994-1996, 1999 EIU Global Executive Survey
Andersen Consulting, Warren Comp.
8/12/2015 STRATEGICALLIANCE 22
Alliance ROI Outperforms
1989-1993 BA&H survey of 2,500 U.S. alliances and 1994-1996
BA&H alliance study of 200 non-U.S. alliances
8/12/2015 STRATEGICALLIANCE 23
Case study #1
8/12/2015 STRATEGICALLIANCE 24
“Executing leadership in managing a portfolio of alliance products and
services using an agreed process.”
Established in 1997
28 members, airline companies from different countries
8/12/2015 STRATEGICALLIANCE 25
To make the travel experience for any passenger easy and smooth,
◦ Closer locations at airports
◦ Common airport facilities (lounges….).
◦ Coordinated travel schedules
◦ Faster transfer
◦ One frequent flyer system
8/12/2015 STRATEGICALLIANCE 26
192 countries served.
More than 4600 aircrafts.
18,500 daily flights.
640 million passengers annually.
180 billion USD sales annually .
8/12/2015 STRATEGICALLIANCE 27
Case study #2
STRATEGIC ALLIANCE AND THE INTELLECTUAL
CAPITAL OF FIRMS
8/12/2015 STRATEGICALLIANCE 28
The survival of companies depends on their capacity for innovation
derived from their organizational intelligence, and knowledge that seen
as a major differential and that the companies management of these
intangible assets are determinants for their growth and sustainability.
8/12/2015 STRATEGICALLIANCE 29
1- Do strategic alliances positively influence the intellectual capital of
the companies that enter into alliances ?
2- Whether the distinct types of proposed strategic alliance influence
the intellectual capital of the companies researched with differing
H0 : Strategic alliances provide an increase in the
intellectual capital of the organizations partnered.
8/12/2015 STRATEGICALLIANCE 30
Corporate Intellectual Capital
8/12/2015 STRATEGICALLIANCE 31
Alliance Type For the purpose of the Study
An original classification consolidated into three broad groups is
proposed for the purposes of this study.
1- Production alliance: An alliance that focuses on the integration of
processes with limited interaction between productive activities.
2- Marketing alliance : An alliance that generally involves non-
competing organizations with common interests, or associated activities
that exploit different market niches to increase their distribution power
and market response time.
3- Innovation alliance : An alliance for the purpose of exchange and
sharing knowledge for the co-development of products, technologies or
8/12/2015 STRATEGICALLIANCE 32
Brazilian industrial firms were selected according to the three :
1- Firms had to have entered into alliances in the last ten years.
2- Firms had to have entered into alliances in the last ten years.
3- Of these 269 companies, only those with sales over $60 million were
143 potential collaborates were located and contacted.
8/12/2015 STRATEGICALLIANCE 33
Research Method, cont.
The collaboration of the principal executives of these 143 companies
was sought as they were considered to be professionals capable of
answering a questionnaire whose responses required a global vision.
Received from 33 companies
The questionnaire featured five questions.
1- The first is what types of strategic alliance were formed by the firm
with other companies .
2- The next four questions (2,3,4 and5) sought to identify the influence
of the alliances formed on the four groups of intangible assets :
processes, relationship capacity, innovation capacity and human capital,
using Likert scale varying from “much worse” to “much better” Scoring
from (-2) to (+2)
8/12/2015 STRATEGICALLIANCE 34
Research Method, cont.
The responses to question 1 led to the formation of seven different
combinations of strategic alliance, derived from the three types
Production, Marketing, Innovation (production and marketing);
(production and innovation); (marketing and innovation); (production,
marketing and innovation)
The responses to questions 2,3,4 and 5 were converted into values and
consolidated in a matrix.
A cluster test was conducted that result in groupings
with good homogeneity between the objects within each groups and
good heterogeneity between the groups.
8/12/2015 STRATEGICALLIANCE 35
Strategic alliances of different types have a positive impact on the
intellectual capital of the organizations involved in them.
The innovation alliance provide the greatest increase in intellectual
capital, and it has the most influence on the creation of intangibles.
When innovation alliances are associated with another type of alliance
their contribution to intellectual capital are reduced.
An even greater reduction in the ratio occurs when the innovation
alliances are associated with the two other types of alliance
8/12/2015 STRATEGICALLIANCE 36
David C. Mowery, Joanne E. Oxley, Brian S. Silverman, Strategic Alliances
and Inter firm Knowledge Transfer (1996) shared expenses and shared
Journal or Intellectual capital , Vol 10 Iss 4 p. 539 – 558 Paper Title:
(Strategic alliances and the intellectual capital of firms) Author : Luiz
Antonio Joia Rodrigo Malheiros Published in : 2009
8/12/2015 STRATEGICALLIANCE 38