Business Strategy / Ch

Chapter 9 Cooperative strategy

Cooperative Strategy

Knowledge Objectives:

1. Explain cooperative strategies & why firms use them

2. Define & discuss three types of strategic alliances

3. Name the business-level cooperative strategies &

describe their use

4. Discuss the use of corporate-level cooperative

strategies & describe their use

5. Understand the importance of cross border strategic

alliances as an international cooperative strategy

6. Describe cooperative strategies’ risks

7. Describe approaches used to manage cooperative

strategies.

A Cooperative Strategy

A strategy in which firms work together to achieve a shared objective.

Strategic Alliances

Develop
Manufacture
Distribute
Goods
Services
where their
are combined to pursue mutual interests to
Core
Competencies
Capabilities
Resources
Partnerships between firms
Firm A
Firm B

Types of Strategic Alliances

Alstream Inc. Microcell & NR Communications
RIM - Research in Motion’s “Blackberry” services
used on wireless devices worldwide.
Domtar & Cascades formed Norampac
Independent firm is created by the joining assets from two other firms where each contributes 50% of the total
Joint Venture
Partnership where the 2 partners don’t own equal shares
Equity Strategic Alliance
Contract is given to supply, produce or distribute a firm’s goods or services (without equity sharing)
Non-Equity Strategic Alliance

Reasons for Alliances by Market Type

Standard Cycle Market
* Gain market power
* Gain access to complementary resources
* Overcome trade barriers
* Meet competitive challenge
* Pool resources for large projects
* Learn new business techniques
Fast Cycle Market
* Form an industry technology standard
* Share risky R&D expenses
* Overcome uncertainty
* Maintain market leadership
* Speed-up product, service or market entry
* Gain access to a restricted market
* Establish franchise in a new market
* Maintain market stability
Slow Cycle Market