Strategic Alliance Essay Example | Topics and Well Written Essays - 3000 words

strategic Alliance - Essay ExampleNike is unmatchable of the largest and most popular athletic footwear company, but it not manufacturing even a single shoe. Similarly, Boeing is superstar of the queen-sizedgest aircraft manufacturing companies, but it does not manufacture not more than cockpits or wing bits. These companies have entered into strategic alliances with the suppliers to do the manufacturing activities for them. Strategic Alliance is an agreement between the firms for conducting the business activities together. Strategic alliance goes beyond just unceremonial handshake agreements or partnership. It includes lengthy formal contract in which both the parties also exchange the right and tally capital to establish a joint venture firm or corporation Strategic alliance means merger of two companies. This is what is generally assumed, but companies argon coming up for multi-strategic alliances nowadays. This expertness be because they are willing to utilize their stren gths to controlling the market. For example, a strategic alliance of six companies was form to develop General Magic Corporation for developing the communication software called Typescript. The companies involved in the strategic alliance are Apple, Motorola, Sony, AT&T, Philips and Matsushita (Longenecker, & TenaLoeza, 2010, p. 224). The large organizations not only form strategic alliance with big organizations but also with the small companies too. The alliances are formed in order to form joint ventures for utilise their skills and expertise to promote their competitive advantage. It links two business entities, without affecting the independent legal condition of the firm or company (Kale, & Singh, 2009, p. 2). Strategic Alliance Trends The strategic alliances have become a piffling form of business practice, which has its primary focus on change magnitude the credibility of the business through friendship of one of more companies. It is also done for achieving the strateg ic objectives of the company, entering into new market, increasing the market share, increasing the delivery capacity of the company, reducing the cost of operation, and introducing innovative products or services in the market. The alliances of the companies nowadays contribute to 20-33 percent of their annual revenue. The companies get the advantage of handling larger order volumes they get bigger customers and contribute offer high quality products or services to the customers. It can be seen that the strategic alliances between the companies are growing at a pace of 25 percent annually (Keasler, & Denning, n. d., p. 3). In an alliance, the different part of the whole organization get involved such as the sales, marketing, supply chain, delivery department, etc. SO it can be well assumed that the support of the internal resources is necessary for a