Strategic Alliances What is Strategic Alliances It is agreement for cooperation among two or more independent firms to work together in the supply chain toward common objectives In practice, a group of suppliers provide a range of products or services that partly complement one another Types of Strategic Alliances Joint Venture based on ownership of capital Equity Strategic Alliances based on ownership of capital and involvement Nonequity strategic alliance based on contracts Global Strategic Alliances management of the resources Stages of Strategic Alliances Strategy Development Partner Assessment Contract Negotiation Alliance Operation Alliance Termination Drivers of Strategic Alliances Technology innovation International trade Telecommunication development Outsourcing of R&D and service Collapse of competition barriers Foreign investment Risks sharing Economy of scale Trends of Strategic Alliances Product and Service Performance and Complementary Position and Leadership in the industry Capabilities and Competencies Social Responsibility Driven Key Factors of Success Strategic Alliances Resource commitment place the goals of a strategic alliance within the framework of the long-term strategies of a company Information sharing and quality Planning the integration Evaluating impact on the stakeholders Trust and Coordination Compatibility, Capability, Commitment Goals of Forming Alliances Setting new global standards Blue-ray alliances leaded by sony Confronting competition CLARK-VOLVO on heavy equipment Access to a geographic market MOTOROLA-TOSHIBA Uniting forces BOEING, GENERAL DYNAMICS, LOCKEED Access to technology Internet 2 Alliances leaded by government Alliances between corporations and non-governmental organizations It is a new trend, driven by sustainability and social responsibility exist between corporations in economic industries and NGOs in social issue industries 155 of US Fortune 500 companies forms alliances with non-government organizations Case Study : HD DVDs vs Blue-ray Hitachi, LG, Panasonic, Pioneer, Philips, Samsung, Sharp, Sony, and Thomson formed the Blu-ray Disc Foundation Toshiba, NEC, Sanyo, Microsoft, RCA, Intel, and Venturer Electronics formed HD DVD Promotion Group Customer will choose one of two incompatible technologies Blue-ray’s Challenges The demand of high definition video Inexpensive storage medium to hold large amount of data for HD video Expensive blue lasers Significantly different and incompatible with HD DVD technology Blue-ray alliance’s Approaches Shifting studio alliances Shifting retail distributors Include Blu-ray player in the popular game console The Outcomes Toshiba and HD DVD alliances ceased the development and production of HD DVD Most retailers adopted Blu-ray and phased out HD DVD Microsoft ceased the production on HD DVD player on Xbox Discuss the following questions: What problems do the format war address? What issues and challenges do Blu-ray present? What can be done to address these issues? What are the business issues that should be addressed when Blu-ray win the format war?
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