Knox Case

In: Business and Management

Submitted By gachucha
Words 6464
Pages 26
Introduction
One of the most important trends in industrial organization of the past quarter century has been the growth of collaboration between independent companies. As large companies have pulled back their collaboration boarders through outsourcing and divestment of ‘non-core’ activities, they have increasingly cooperated with other companies in order to engage in activities and access resources outside their own boundaries. The concept of strategic alliances has become widely used in the business language to refer to the types of partnerships agreements between two or more companies that pursue a clear strategic collaboration objective, with different levels of possible integration among the members. In today’s competitive global economy strategic alliances are a crucial option for achievement of competitive advantage. By developing strategic alliances, organisations can share their excess or complementary resources and capabilities so as to strengthen their position in the market and gain competitive advantage. When such alliances are effectively and efficiently managed the partnering firms can gain immensely towards mutual profitability.
In any cooperative relationship trust is key for success. Where mutual trust and synergies exists, partnering organisations can benefit substantially from opportunities that can be exploited through maximum utilization of combined resources. On the other hand, where there is no trust, extensive monitoring systems become necessary to monitor each partners’ contribution and this results in increased cost of operations that ultimately hamper the competitiveness of the alliance.
Definition
A strategic alliance is a relationship between two or more parties to pursue a set of agreed upon goals or to meet a critical business need while remaining independent. Partners may provide the strategic alliance with resources such as…...

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