The use of strategic alliance in an organization

When you are working in a large organization, a different type of partnership will occur in your organization.

equity strategic alliance example

Each partner therefore provides the other with vital resources and uses the partnership to extend its skill set into new areas.

The first company to create a new technology might set the standards for its industry simply because it is the first. You would start a strategic alliance when you are unable to achieve results on your own, or when the strategic alliance will dramatically improve the time to results.

If so, even without trust, the alliance can succeed.

Strategic alliance advantages and disadvantages

An example would be the close relation between car manufacturers and their suppliers. Overcoming competition Companies often co-operate in marketing or distribution to overcome competition. During this time the number of strategic alliances increased dramatically. Partnering with a local company can help overcome these barriers. It is very difficult to predict whose technology will set the standard for the industry, so trying to be the first into the market with a new technology can be very risky. Examples would be early credit institutions or trade associations like the early Dutch guilds. An opportunity for each member of the relationship to achieve their goals, but assisting the other party to achieve theirs. Each partner therefore provides the other with vital resources and uses the partnership to extend its skill set into new areas.

The real issue is follow-through. It is a way to supplement internal assets, capabilities and activities, with access to needed resources or processes from outside players such as suppliers, customers, competitors, companies in different industries, brand owners, universities, institutes or divisions of government.

These shareholdings make the company stakeholders and shareholders of each other. Both partners are complex organizations and integrating their alliance goals only happened due to solid planning and manageable expectations regarding implementation.

The use of strategic alliance in an organization

Definitions are equally varied. Especially suppliers get involved in product design and distribution decisions. A strategic alliance is a long-term value-creating relationship. The relationship moved Starbucks into the bottled-beverage market while PepsiCo gained an innovative product with a well-branded partner. When discussing the definition I always emphasize the italic items. As a result, the most competitive corporations are adopting a strategy of maintaining their core competencies only. Many pharmaceutical companies have marketing alliances.
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6 Reasons for forming strategic global business alliances