Joint Ventures, Strategic Alliances and Mergers & Acquisitions
Joint Ventures, Strategic Alliances, Collaborations and Merger and Acquisitions
Questions |
Q1. Why is a Joint Venture (JV) preferable to more general collaboration form of the Strategic Alliance?
Q2. What are the relative merits and weaknesses of JVs and SAs?
Q3. Why would company seek M&A as a market entry strategy? What are the advantages and disadvantages of M&A? why might a merger fail and what might be the outcome?
Q4. What are the relative merits/ disadvantages of JVs, SAs, and M&As
Collaboration |
Cooperation between two or more firms can take many forms, such as cross- licensing of proprietary technology, sharing of production facilities, co-funding of research projects and marketing of each other’s products using existing distribution networks. Such cooperation is know as strategic alliance or joint venture (a special type of strategic alliance).
There are two types of collaboration: those who include and those that exclude.
Excluded: one or both of the companies pursuit their own interests. Then there will be opportunity for cheating, either:
-Aggressive cheating: cheating in which is detrimental to the other party.
- Neutral cheating: the other party can benefit but you don’t say or do anything for their advantage.
Included: When both parties refrain from cheating through patients.
The ingredients to a successful collaboration is: -Clear purpose -Operational compatibility -Performance expectations (goals, governance) -Mutual trust -Mutual adjustment (flexibility)
Element to think about when selecting a partner:
-Nature of a potential partner’s products or services- its often hard to cooperate with a firm in one market while doing a battle with the same firm in another market. Under such circumstances, each firm may be unwilling to reveal all its expertise to the other partner for the fear that the partner will use the knowledge against the firm in the other market.
Most experts believe a firm should ally with a
Questions |
Q1. Why is a Joint Venture (JV) preferable to more general collaboration form of the Strategic Alliance?
Q2. What are the relative merits and weaknesses of JVs and SAs?
Q3. Why would company seek M&A as a market entry strategy? What are the advantages and disadvantages of M&A? why might a merger fail and what might be the outcome?
Q4. What are the relative merits/ disadvantages of JVs, SAs, and M&As
Collaboration |
Cooperation between two or more firms can take many forms, such as cross- licensing of proprietary technology, sharing of production facilities, co-funding of research projects and marketing of each other’s products using existing distribution networks. Such cooperation is know as strategic alliance or joint venture (a special type of strategic alliance).
There are two types of collaboration: those who include and those that exclude.
Excluded: one or both of the companies pursuit their own interests. Then there will be opportunity for cheating, either:
-Aggressive cheating: cheating in which is detrimental to the other party.
- Neutral cheating: the other party can benefit but you don’t say or do anything for their advantage.
Included: When both parties refrain from cheating through patients.
The ingredients to a successful collaboration is: -Clear purpose -Operational compatibility -Performance expectations (goals, governance) -Mutual trust -Mutual adjustment (flexibility)
Element to think about when selecting a partner:
-Nature of a potential partner’s products or services- its often hard to cooperate with a firm in one market while doing a battle with the same firm in another market. Under such circumstances, each firm may be unwilling to reveal all its expertise to the other partner for the fear that the partner will use the knowledge against the firm in the other market.
Most experts believe a firm should ally with a