1. Strategic Alliances

2. Strategic Alliances : A strategic alliance is a
relationship between firms that allows to create
more value than they could individually create. The
firms come together to attain agreed upon goals,
while maintaining their independence.
It is a co-operative agreement between potential or
actual competitors.
e.g. GM & Hitachi collaborating to produce
electronic components for automobiles,
e.g.- GE and Wipro to develop new versions of
medical diagnostic equipment for emerging
markets.

3. Joint ventures:
Joint ventures involve the partner’s
creation of a third entity representing the
interests and capital of the two or more
partners.
Partners contribute their own proportional
amounts of capital, distinctive skills,
managers, reporting systems and
technologies to the venture.

4. Successful Strategic
Alliances
Fuji & Xerox
IBM with Toshiba
Toyota & GM
Hero Honda
Wipro GE
L&T and Mitsubishi
Unsuccessful strategic
alliances
PAL- Peugeot
TVS- Suzuki
Godrej Soaps - P&G
Kinetic- Honda
Bajaj –Kawasaki
Mahindra- Renault

5. Rationale for Joint Ventures
1.The basic motive for starting a joint venture is sharing
investment.
2. Learning ( knowledge acquisition) is the second biggest
motive for joint ventures.
3. Reduce investment outlay and share risk.
4. to gain endorsement from government authorities.
5. to acquire complementary technological or management
resources at lower cost , or to drive benefits from
economics of scale , critical mass , and learning
experience.
6. Another rationale for joint ventures is to gain tax
advantages

6. Rationale for Joint Ventures
1.The basic motive for starting a joint venture is sharing
investment.
2. Learning ( knowledge acquisition) is the second biggest
motive for joint ventures.
3. Reduce investment outlay and share risk.
4. to gain endorsement from government authorities.
5. to acquire complementary technological or management
resources at lower cost , or to drive benefits from
economics of scale , critical mass , and learning
experience.
6. Another rationale for joint ventures is to gain tax
advantages