Research Paper on:
Companies and Strategic Alliances

Unformatted Sample Text from the Research Paper:
benefits that need to be considered, but also the costs that may be felt. To start any look at strategic alliances the first stage is to define what is meant  by a strategic alliance. The definition of a strategic alliance is not clear cut, for some authors it appears to include joint ventures (Thompson, 1998). In this paper ventures  that include new jointly owned companies or involve some type of equity ownership are classified as joint ventures, and separate from strategic alliances. Strategic alliances are formed when there is  deemed to be a benefit to be gained form to organisations working tighter. This may be two companies that are competitors which have common skills, alternatively it may be companies  that have complimentary competences or skills (Thompson, 1998). In most cases, there will be some type of existing link, such as though the value chain where an alliance may create  more value in the supply chain. Strategic alliances are created so that both partners, or more as alliances may be more than only two companies, will benefit. This may be  in increased sales, lower costs or the transfer of skills or knowledge (Mintzberg et al, 1998). The main goal will be a synergy, where there is an agreed level of  co-operation that does not involve mergers or equality purchases, but will create an increase in the bottom line. The idea is to gain a competive advantage over those the companies  compete with in a cost effective manner. There are two main types of strategic alliances, the first is that which take place  between companies at the same stage in the value chain that may deal in competing products or services, or complimentary goods and services. These are horizontal in nature. The motivation