Module 7 Strategic alliances

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Module 7 Strategic alliances
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Evidence of alliances

• In an effort to establish itself as a force in
  European and Japanese markets, the Nasdaq formed
  a joint venture with SSI Technologies of India to
  develop an internet-based trading and market
  system to launch Nasdaq Europe and Nasdaq Japan.

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• In February 2001, the Coca-cola company and
  Procter Gamble announced a 4.2 billion joint
  venture to use Coca-Colas huge distribution
  system to increase reach and reduce time to
  market for the PG products Pringles and Sunny
  Delight.

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Learning objectives

• Understand the potential benefits and risks
  associated with strategic alliances
• Learn the life cycle of strategic alliances
• Review forms of strategic alliances
• Learn the monitoring and evaluating process for
  strategic alliances
• Analyze and deal with problems related to
  strategic alliances

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Benefits of strategic alliances

• Market
• Resources
• Technology
• Management practices
• New opportunities
• Competitive advantages

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Types and forms of alliances

• Strategic alliances any formal arrangement
  between two or more organizations for purpose of
  mutual gain.
• Ownership vs control
• Number of members
• Governance structure
• Mandated vs voluntary participation

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A life cycle of organization alliances in health
care
Stages
Critical crossroads
Emergence
Transition
Maturity
Environment threat uncertainty
Put alliance Interest first Realize
Benefits Attain objectives Member commitment
Motivation to Achieve alliances Increase
Dependence Activities Hire or
form Management group Coordination control
Increased Dependence Or Withdrawal Future
of alliance
Share ideologies dependencies
Define purposes of Alliances Develop membership
criteria
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Risks of strategic alliances

• Overly optimistic
• Poor communication
• Lack of shared benefits
• Lack of commitment
• Lack of a clear boundary
• Lack of evaluation system
• Slow results or payback
• Culture mismatch

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Monitor and evaluate strategic alliances
Decide to monitor performance
Decide the purpose
Design methodology
Collect data
Interpret data
Report and recommendations
Evaluate the process
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Analyze and deal with problems

• Locate problems
• Environmental problems
• Strategy problems
• Structure problems
• Behavior problems
• Identify the root of the problem
• Parochial self-interest
• Misunderstanding and a lack of trust
• Different assessments
• Low tolerance for ambiguity

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• Deal with problems
• Education
• Participation
• Facilitation
• Negotiation
• Cooperation
• Coercion

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Information about the third case summary

• Average 7.89
• Winner of The Best Quality
• Shaen Ann Stesco
• Winners of The Excellent Summary
• Maryellen Gleeson
• Mary Choi Jenna Allen