An insight on Strategic Alliances, with appropriate examples, rationales, factors, challenges and types of strategic alliances.

1. STRATEGIC ALLIANCE

2. Strategic Alliances are co-operative agreements between two
or more companies to work together and share resources to
achieve a common business objective.
CONCEPT

3. SPOTIFY AND UBER APPLE PAY AND MASTER CARD
Apple decided to get into
digital payment business,
Apple got the services &
Mastercard got it’s reputation
GOOGLE AND LUXOTTICA
With each other’s alliance,
both companies expanded
their business by combining
technology with luxury
These two companies, through
this alliance, increasing their
customer base as they offer
uber riders to take control of
the stereo

4. To Enhance Capability and
Competence
To Enhance Value Creation
To Leverage Resources / Risk
Management
To Enhance Market Position and
Achieve Business Development
To Achieve Globalization
OBJECTIVES

5. RESULTS IN
ECONOMIES OF
SCALE IF
PROPERLY
PLANNED AND
EXECUTED
WHERE RISK IS
HIGH IN AN
INDUSTRY, TWO-
PLAYER FORM
ALLIANCE TO
MITIGATE THE
RISK
STRATEGIC ALLIANCE HELPS
THE COMPANIES DEAL WITH
COMPETITIVENESS
BUILD BRAND
AWARENESS BY
USING
GOODWILL OF
AN ALREADY
ESTABLIISHED
COMPANY
COMPETE WITH THE BEST
PLAYER IN THE INDUSTRY
RATIONALE
OF
STRATEGIC
ALLIANCE

6. Select the
proper partners
for the indented
goals
Share the right
information & come
to a realistic
agreement on time
Negotiate a deal
that includes both
the risks and
benefits
Share details -Mutual,
flexible commitment
on what’s suitable to
change
Respect and
protect the brand
of each partner
KEY FACTORS
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7. THREAT
2
1
THREAT THREAT
3
THREAT
4
Partners may
misrepresent
what they
bring to the
table (lie
about
competencies
that they do
not have)
Partner may
fail to commit
resources and
capabilities to
the other
partners
One partner
may commit
heavily to the
alliance while
the other
partner does
not
Partners may fail
to use their
complementary
resources
effectively
CHALLENGES

8. A joint venture is a child
company of two parent
companies. It’s maintained by
sharing resources and equity
with a binding agreement
1
Joint Venture An equity strategic alliance
is created when one
company purchases a
certain equity percentage
of the other company
When two or more
companies sign a
contractual relationship to
pool their resources and
capabilities together
Global strategic alliances are
typically set up when a
business desires to edge into a
related business or new
geographic market
Global
Strategic
Alliances
4
Non-equity
Strategic
Alliance
3
Equity
Strategic
Alliance
2
Types of Strategic Alliances

9. JOINT VENTURE EQUITY STRATEGIC ALLIANCE
NON-EQUITY STRATEGIC ALLIANCE GLOBAL STRATEGIC ALLIANCE
Google & NASA together
developed Google Earth
Walmart invested in Indian
E-commerce giant Flipkart
Maruti-Suzuki alliance in India
Nokia and Microsoft entered into
Global Strategic Alliance
Examples

10. 3
The firm has to be
selective in choosing
the partner looking
at a bigger picture,
so that everything
runs smoothly, and
business is not
affected
2
Strategic alliances can
work for the benefit
of a business to
reduce development
costs and speed up
timescales
It is an important tool for
attaining and maintaining
competitive advantages
1
Businesses should be
properly aware of the
alliances and choose
between the available
options
Mutual benefits among
partners should be
carefully assessed
CONCLUSION

11. THANK YOU