Strategic Alliance

Criss Dayana Ramirez International Business I

Strategic AllianceIs a voluntary, formal arrangement between two or more parties to pool resources to achieve a common set of objectives that meet critical needs while remaining independent entities.

Strategic alliances involve exchange, sharing, or co development of products, services, procedures, and processes.

Stages of Alliance FormationStrategy Development: involves studying the alliance’s feasibility, objectives and rationale, focusing on the major issues and challenges and 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: involves determining whether all parties have realistic objectives, defining each partner’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 winding down the alliance, for instance when its objectives have been met or cannot be met.

Types of strategic alliances

Global Strategic Alliances working partnerships between companies across national boundaries and sometimes formed between company and a foreign government, or among companies and governments.

Equity strategic alliance is an alliance in which two or more firms own different percentages of the company they have formed by combining some 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.

Advantages DisadvantagesAllowing each partner to concentrate on activities that best match their capabilities.

Learning from partners & developing competences that may be more widely exploited elsewhere.

Adequate suitability of the resources & competencies of an organization for it to survive.

share risk between the companies.

Significant differences between the objectives

Irreconcilable differences in business culture and management styles.

Opportunistic behavior by any participant.

Loss of control over such important issues as product quality, operating costs, employees, etc.

StarbucksStarbucks partnered with Barnes and Nobles bookstores in 1993 to provide in-house coffee shops, benefiting both retailers.

In 1996, Starbucks partnered with Pepsico to bottle, distribute and sell the popular coffee-based drink, Frappacino.

A Starbucks-United Airlines alliance has resulted in their coffee being offered on flights with the Starbucks logo on the cups.

AppleApple partnered recently with Clearwell in order to jointly develop Clearwell's E-Discovery platform for the Apple iPad. E-Discovery is used by enterprises and legal entities to obtain documents and information in a "legally defensible" .

Hewlett Packard and Disney

Hewlett-Packard and Disney have a long-standing alliance. Disney wanted to develop a virtual attraction called Mission: SPACE, Disney Imaginers and HP engineers relied on HP's IT architecture, servers and workstations to create Disney's most technologically advanced attraction.

WebgraphyStrategic 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

Thank you!!