Forming a strategic alliance essay

Document Type:Essay

Subject Area:Management

Document 1

Strategic alliances give the chance for flexibility that can be of benefit to each of the involved organizations. Nevertheless, that same energy applied to keep options open can thwart the association and bring about disagreements in the progress of the alliance (Cheng-WenLee, (2007). Hence, it is vital for both the parties to provide full consideration to a big array of issues before reaching an agreement; this way, each of the organizations forming alliance has clear and precise expectation. Specifically, it is essential for both Company A and Company B be clear on: the allocation of profits attained from the alliance; the scope of the authority of each company with respect to the association; the capacity of one or both companies to veto or supersede decisions of the other; the level of control over and access to resources of the two parties, for instance the intellectual property; and lastly the level of control that each company will have over the resulting innovation or product.

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As I opt to form an alliance with this organization from Europe, it will be most appropriate to involve a law firm that has expertise in the operation and structuring of strategic alliances. This can at times be considered to be a form of competition between the parties with regards to which organization uses its resources more than the other. One organization might choose to use fewer resources in the alliance and use most of it in its external deals, hence killing the spirit of association. In the progress of the alliance, one party might choose to fully commit to the objectives of the alliance, while the other might not. By doing this, it is by fact possible for the alliance to fail in attaining its goals.

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Another challenge that arises due to the formation of an alliance is the commitment of capabilities and resources by both partners. For instance, the decision to merge together both resources owned by the two companies will be a vital one (Margherita Russo1 & Maurizio Cesarani 1, 2017). Additionally, it will be imperative to maximize the subjective expected utility of the two organizations. This is to mean that, the two organizations will come into an agreement to utilize and share their capabilities harmoniously without any form of discrimination or hidden intent. To enhance the alliance initiative, I will employ the descriptive decision making model to read, understand and be able to predict the other partner’s behavior. The primary objective is to acquire a precise model of the partner’s real decision process, and clearly understand what motives drive their decisions; whether it is mutual growth or individual development (Linwei Li, Feifei Jiang, Yunlong Pei & Nengqian Jiang, 2017).

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Another decision making method that will be effective in ensuring success in the alliance initiative is the operations research method. This is a very important method that entails the practical use of quantitative methods in the course of decision making (Meagher, Kieron & Wait, Andrew, 2019). When applying this method, I will employ the mathematical, scientific or logical means to attain realistic solutions to problems that might arise as a result of the alliance. The Linear programming decision making method is another vital method applicable to this alliance initiative. This is a quantitative method utilized in decision making (Robert Lawrence Kuhn, 1989). All in all, as a senior executive of the company, I believe when all factors are held constant, and the alliance is formed with the Organization from Europe, then profitable decisions will be based on the interest of both organizations (T.

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