Strategic AllianceIs a voluntary, formal arrangementbetween two or more parties topool resources to achieve acommon set of objectives thatmeet critical needs whileremaining independent entities. Strategic alliances involve exchange, sharing, or co development of products, services, procedures, and processes.
Stages of Alliance FormationStrategy Development: involves studying thealliance’s feasibility, objectives and rationale,focusing on the major issues and challengesand development of resource strategies. Partner Assessment: involves analyzing a potential partner’s strengths and weaknesses, creating strategies for accommodating all partners’ management styles.
Stages of Alliance FormationContract Negotiation: involvesdetermining whether all parties haverealistic objectives, defining eachpartner’s contributions and rewards. Alliance Operation: involves addressing senior management’s commitment, finding the caliber of resources devoted to the alliance, linking of budgets and resources with strategic priorities.Alliance Termination: involves windingdown the alliance, for instance when itsobjectives have been met or cannot bemet.
Types of strategic alliancesEquity strategic alliance is an alliance in whichtwo or more firms own different percentages ofthe company they have formed by combiningsome of their resources and capabilities. Non-equity strategic alliance is an alliance in which two or more firms develop a contractual- relationship to share some of their unique resources and capabilities.Global Strategic Alliances working partnershipsbetween companies across national boundariesand sometimes formed between company and aforeign government, or among companies andgovernments.
Advantages DisadvantagesAllowing each partner to Significant differences between theconcentrate on activities that best objectivesmatch their capabilities.Learning from partners & Irreconcilable differences in businessdeveloping competences that may culture and management styles.be more widely exploitedelsewhere. Opportunistic behavior by anyAdequate suitability of the participant.resources & competencies of anorganization for it to survive. Loss of control over such importantshare risk between the companies. issues as product quality, operating costs, employees, etc.
StarbucksStarbucks partnered with Barnes andNobles bookstores in 1993 to provide in-house coffee shops, benefiting bothretailers. In 1996, Starbucks partnered with Pepsico to bottle, distribute and sell the popular coffee- based drink, Frappacino.A Starbucks-United Airlines alliance hasresulted in their coffee being offered on flightswith the Starbucks logo on the cups.
AppleApple partnered recently with Clearwell in order to jointly develop Clearwells E-Discovery platform for the Apple iPad. E-Discovery is used by enterprises and legalentities to obtain documents and information in a "legally defensible" .
Hewlett Packard and DisneyHewlett-Packard and Disney have a long-standing alliance. Disney wanted todevelop a virtual attraction called Mission: SPACE, Disney Imaginers and HPengineers relied on HPs IT architecture, servers and workstations to createDisneys most technologically advanced attraction.
Webgraphy Strategic Alliances Help for Cooperative Strategies, Management, Homework Help - Transtutors.com. (n.d.). Online Tutoring, Homework Help, Assignment Help – Transtutors.com. Retrieved March 18, 2013, from http://www.transtutors.com/homework-help/strategic- management/cooperative-strategies/strategic-alliances/ Strategic Alliance Advantage and Disadvantage. (n.d.). Internet Business Lawyer - Internet Law and Internet Attorney. Retrieved March 18, 2013, from http://www.socalinternetlawyer.com/strategic-alliance-advantage- disadvantage/ Media, D. (n.d.). Examples of Successful Strategic Alliances | Chron.com. Small Business - Chron.com. Retrieved March 18, 2013, from http://smallbusiness.chron.com/examples-successful-strategic-alliances- 13859.html