What is Alliance Strategy?

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What is Alliance Strategy?

• Group 4

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C o n t e n t
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Definition of Alliance

• What is alliance?
• Answer a strategy that used to fulfill a broad
  range of corporate goal, including
• Gaining scale.
• Reducing costs.
• Accessing new skills.
• Product or market.
• Sharing risk.
• Characteristics of Alliance
• Agreements between 2 or more separate firms.
• Flexible contract.
• Joint decision making.

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introduction

• Todays, about 20-50 of alliance are being
  implement in corporate value.
• Many firms have been successful in implementing
  alliance into their company, such as Starbuck,
  IBM, Eli Lilly, and Corning Glass.
• However, up to 30-70 of alliance failed.
• So, what are the reasons behind the failure of
  those alliances?

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What make the alliance failed?

• Unclear Strategies.
• Poor partner choice.
• Unbalanced alliance economics.
• Dysfunctional governance.
• Clashing corporate culture goal.
• Lack of sufficient operating staff skill and
  parent commitment.

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Get TO THE RIGHT DIRECTION!!!

• Instead of focusing on the strategic alliance,
  managers should focus on alliance strategy,
  because strategic alliance without an alliance
  strategy is likely to failed.
• Strategic Alliance A deal, a new venture, an
  organization.
• Alliance strategy an intent, a dynamic process,
  a logic that guide alliance decisions.

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Develop alliance strategies, not strategic
alliances . . .

• 1. Let business strategy drive the alliance
  logic.
• 2. Design the alliance to fit the strategy.
• 3. Grow relationships, dont just do deals.
• 4. Use constellations of alliances, not
  stand-alones.
• 5. Organize internally to cooperate externally.

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The 4 factors of alliance strategy
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The 4 factors of alliance strategy

• Alliance Design identify the role of alliance
  in the business strategy, including
• Setting the goal.
• Scope of alliance.
• Determining the criteria method for selecting
  partner.
• Crafting the structure process for shaping value
  and decision making in the alliance.

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The 4 Factors of alliance design

• What are the goals of the company?
• Which partner should the company select to
  alliance with in order to meet the goals?
• How should the Alliance be structured?
• Which type of Alliance would be suitable?
• What is the process of adjusting or terminating
  an alliance ?

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The 4 factors of alliance strategy

• Alliance management how partners of alliance
  make continual investment of effort and adjust
  their relationship in response to new
  circumstances.
• The success of alliance depends much on the
  unfolding relationship between the partners.
• What will be the process of making decisions?
• Example will there be a meeting with a CEO every
  time a decision has to be made or are the mangers
  of the department allowed to make the decisions?

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The 4 factors of alliance strategy

• What are the terms relationship between the
  parent company and our company?

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The 4 factors of alliance strategy

• Alliance Constellation the collection of
  alliance that fits together, collection are often
  important for companies-in-system-on-network-type
  business.
• How many and what type?
• Should the alliance be formed?

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The 4 factors of alliance strategy

• Alliance capability how a supportive internal
  infrastructure can create a successful of
  external alliance.
• Alliance capacity normally seek ways to share
  best practices among it business units and to
  develop special expertise where it is needed.
• The more capability the more
  selections of partners.

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The success of one depends on the other.
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Mastering Alliance Strategy

• Determine how alliances fit in your strategy.
• Collect and analyze your own experience.
• Develop and introduce alliance tools.
• Coordinate your alliance activities.
• Find and internalize best thinking.