Short Write-up –Innovation across Firm Boundaries
Short Write-up –Innovation across Firm Boundaries
Xin Gu
1. What were some key problems in the Alpha-Omega alliance? What caused them?
First, both firms were accustomed to getting their way" with alliance partners because of their market clout and size; but this situation was different. Since both companies rarely compromised, partnership discussions were arduous. At one low point, both sides refused to give in on a particular issue, and one team coldly got up and left. Second, one major hurdle was integrating the partners’ customer databases. Each firm's customer list was a significant corporate asset, and neither was willing to openly give the other partner access. Third, frequent disputes centered on issues such as which company name customer service representatives would use. For instance, Omega refused to allow Alpha's logo to appear on the front of "its"' membership cards. After several months, they reached a compromise: the new cards would have an "Alpha side" and an "Omega side." Forth, the participation of the senior executives is unbalanced. The Omega’s top-tier executives were more centrally involved in the alliance while the Alpha were too bureaucratic and not assigning enough personnel who were able to approve decision.
2. How did the lack or presence of trusting relationships affect the alliance?
The authors claimed that trust plays an important (often dominant) role in successful alliances, and communication and information processing are instrumental to building trust between partners. The alliance was embedded in a contentious competitive environment, so perceptions of hidden agendas, deceit, opportunistic behavior, and carefully measured communication heightened the tension. Fear of "hidden agendas" and ulterior motives preoccupied managers on both sides. Alpha and Omega accused each other of opportunism: their needs were routinely superseded by the .self-intere.st of their counterpart. While Alpha participants were generally
Xin Gu
1. What were some key problems in the Alpha-Omega alliance? What caused them?
First, both firms were accustomed to getting their way" with alliance partners because of their market clout and size; but this situation was different. Since both companies rarely compromised, partnership discussions were arduous. At one low point, both sides refused to give in on a particular issue, and one team coldly got up and left. Second, one major hurdle was integrating the partners’ customer databases. Each firm's customer list was a significant corporate asset, and neither was willing to openly give the other partner access. Third, frequent disputes centered on issues such as which company name customer service representatives would use. For instance, Omega refused to allow Alpha's logo to appear on the front of "its"' membership cards. After several months, they reached a compromise: the new cards would have an "Alpha side" and an "Omega side." Forth, the participation of the senior executives is unbalanced. The Omega’s top-tier executives were more centrally involved in the alliance while the Alpha were too bureaucratic and not assigning enough personnel who were able to approve decision.
2. How did the lack or presence of trusting relationships affect the alliance?
The authors claimed that trust plays an important (often dominant) role in successful alliances, and communication and information processing are instrumental to building trust between partners. The alliance was embedded in a contentious competitive environment, so perceptions of hidden agendas, deceit, opportunistic behavior, and carefully measured communication heightened the tension. Fear of "hidden agendas" and ulterior motives preoccupied managers on both sides. Alpha and Omega accused each other of opportunism: their needs were routinely superseded by the .self-intere.st of their counterpart. While Alpha participants were generally