Joint ventures and strategic alliance - Essay Example

Comments (0) Cite this document
The agreement is aimed at cooperating on specific activities in the business. The aim of the alliance is to ensure that the parties to the alliance benefit from the strengths of one another. The…
Download full paperFile format: .doc, available for editing
GRAB THE BEST PAPER96.3% of users find it useful
Joint ventures and strategic alliance
Read TextPreview

Extract of sample "Joint ventures and strategic alliance"

Download file to see previous pages It also fosters reduction of risks and costs between the parties in different areas. Such areas include relationships with suppliers and the development of new technologies. Strategic alliances are sometimes considered to have equal magnitudes as joint ventures. The difference between the two is where an alliance can accommodate parties that are competitors, and the engagement lasts for a short time as compared to a joint venture. A joint venture, therefore, is a business agreement in which the parties involved agree on certain factors towards the development of what looks like a new entity. The factors are development criteria, finite time, creation of a new entity and new assets by contribution of investment. The parties to the joint venture contribute equity. Per se, they share the expenses, assets and revenue on agreed on basis. Strategic alliances and joint ventures are critical to the organization for a number of reasons. The paper focuses on discussing these reasons and whether the reason enables the alliances and ventures to complement global mega-mergers as a global business strategy.
There are several critical reasons or important factors that necessitate for the formation of global strategic alliances and joint ventures. Per se, they are the benefits that international businesses may accrue from such alliances and ventures (Chou et al., 2014 p. 42). There are many motivational factors that may drive the firms to enter into the ventures or alliances. Per se, the use of strategic alliances and joint ventures is increasingly gaining popularity. A growing number of globally multinational firms are finding it better to carry their operations under such umbrellas. Firms argue that under such agreements, each party can bring to the table complementary strengths. Such powers enable the companies to gain significant competitive advantages (Chou et al. 2014, p. 42).
The firm’s knowledge ...Download file to see next pagesRead More
Cite this document
  • APA
  • MLA
(“Joint ventures and strategic alliance Essay Example | Topics and Well Written Essays - 2000 words”, n.d.)
Joint ventures and strategic alliance Essay Example | Topics and Well Written Essays - 2000 words. Retrieved from
(Joint Ventures and Strategic Alliance Essay Example | Topics and Well Written Essays - 2000 Words)
Joint Ventures and Strategic Alliance Essay Example | Topics and Well Written Essays - 2000 Words.
“Joint Ventures and Strategic Alliance Essay Example | Topics and Well Written Essays - 2000 Words”, n.d.
  • Cited: 0 times
Comments (0)
Click to create a comment or rate a document

CHECK THESE SAMPLES OF Joint ventures and strategic alliance

Corporate strategy: Joint Ventures and Strategic Alliances

...model. But the current buzz cannot be concluded as the ultimate success of the interface. We will have to wait and watch how practical the application is over a period of time. Also, there is all likelihood that players like Samsung and Nokia will come up with similar technologies to compete in the market. Apple’s acquisition of Siri is a clear example for the leverage of technology to gain market share. The moment they understood the potential of Siri to take the market by storm, they acquired it to be embedded into the handset. It was aimed at facing the stronger players like Samsung, Blackberry and Nokia. Joint Ventures and Strategic Alliances Joint...
10 Pages(2500 words)Essay

Contractual Agreements Vs Joint Ventures

...objectives related to different functions including R&D stipulate guidelines for performance of those functions smoothly. This paper refers to the R&D programs with inter-firm co-operation (IV & V points listed above). The modes could be either contractual or through joint ventures. The basic objective behind these methods is to ensure cost-economization and strategic intent. General trends in R&D dependency: The MERIT-CATI list which surveys the trend of R&D dependency establishes the following results: 1960s witnessed a relatively low number of such collaborations with a gradual increase towards the end from 10 a year to 30 a year. 1970’s continued the 30 a year trend and graduated to...
14 Pages(3500 words)Assignment

International Joint Ventures

...subsidiaries and joint ventures Subsidiaries are those companies which are controlled by larger organizations like an MNC. It guarantees full operational ownership in the host country. A wholly owned subsidiary is one where the parent company owns 100% stocks of the subsidiary company. These are the expensive and complicated form of market entry. To establish a wholly owned subsidiary, a company can either enter into ventures with a local company or can establish a new venture on its own in the host country (Charles & Jones, 2007, p.290). A joint venture is a strategic move adopted by countries while setting up a...
13 Pages(3250 words)Essay

Strategic Alliance

...? Strategic Alliance Introduction Strategic alliance is a relationship, which is formulated between two or more parties in order to follow agreed goals. Along with this, the companies aim at meeting the critical business needs while maintaining their separate entities. This form of cooperation tries to cover the loopholes of mergers and acquisitions and provide opportunities for remaining independent organisation while working together on some critical projects. This is basically an arrangement of two companies which take a decision to share resources in order to maximise their benefits from their projects (Dumela 2004). In strategic alliance, there is less involvement and it is temporary in nature which is unlike joint venture... ...
15 Pages(3750 words)Assignment

INTERNATIONAL JOINT VENTURES in dealing with local authorities in an effectively manner. SAIC helped GM get preferential government treatment in several areas. The workforce that has been instrumental for the collaboration was well prepared in helping the joint venture successfully compete with other players in the automotive market (Bellon, et al 2001). Due to its proficient performance with the guide of the SAIC, SGM managed to even acquire more plants in the Chinese market more than any foreign company has ever been allowed. Nevertheless, GM had all the trust in SAIC to give up shareholder majority with intent of making available acquisitions for local organisations. With such deliberations, it is therefore apparent that...
16 Pages(4000 words)Assignment

Associates and Joint Ventures

...Holdings & Joint Ventures Analysis of Implications Introduction Companies, especially trans-national companies find it convenient to acquire, amalgamate or go in for a joint venture operation with a company or unit with a native origin in the country they wish to operate. Even inside a country it has been found to be beneficial to hold a smaller unit as a joint venture to improve reach in the market without incurring the cost and gestation time as it would be in the case of opening a new unit. In the case of software companies this trend is more pronounced as it involves skilled human capital which comes along with the acquisition. The proposal is seen to be, in the light of a business operation to be the most favorable method... consider...
10 Pages(2500 words)Essay

Associate and Joint Ventures

...of the entities and the objectives of the participants. The reason behind this strategic alliance between the companies is not a single one in fact there are many. Companies engage in these activities to benefit more and reduce the risk involved with competition and failure. Here are a few advantages which the companies seek in order to maintain growth and expansion due to a Venture. Risk is shared because as the companies form a venture the organizations pool their resources and therefore if a company bears a loss then the pooled capital will decrease not the company’s. By forming a joint venture a company can easily expand their...
10 Pages(2500 words)Essay

General Electric's Joint Ventures

...of the business. As opposed to joint ventures where partner companies have significant power in making strategic decisions, acquisitions allow companies to have full control of management and resources (Hill, 2011). The preference for acquisitions by General Electric also resulted to the congruency of this strategy to its business philosophy. However with the changing business environment, the company has shifted to joint ventures as an entry mode into foreign markets. Question 2 In the recent past, General Electric has preferred joint ventures as a strategy for entry into foreign markets. This is because of the bids for...
2 Pages(500 words)Case Study

General Electrics Joint Ventures

...control over its daily business operations without the risks of losing the company’s technological know-how (498). Furthermore, in the process of being a ‘wholly owned subsidiary’, GE can freely engage itself with strategic alliances (499, 504). Back then, one of the possible reasons why GE stayed away from joint venture agreement is the fear of losing some of its technological know-how to its business partner. For many years, GE has been accustomed of having full control over its business operations. In the process of entering into joint-venture agreement with a local automobile manufacturer in China, GE will have to be forced to share...
4 Pages(1000 words)Case Study

Joint Ventures: BP and Rosneft

...(Saloner, Shepard, & Podolny, 2001). Drivers for the Joint Venture The expected regional position from this alliance is another reason I chose to evaluate this joint venture. The alliance will indisputably give way for more doors for BP, mostly within Russia, which is a key region in the oil and gas sector (Dess & Miller, 1993). The expected deal will permit one of the largest firms in the world to the experience it requires to break into the marketplace significantly and ensure its long time exploration of the widespread energy, and untapped hydrocarbon reserves that are therein. The deal strategically appears very...
10 Pages(2500 words)Essay
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.

Let us find you another Essay on topic Joint ventures and strategic alliance for FREE!

Contact Us