Global Marketing Management

Warren J. Keegan

Chapter 9 Cooperative StrategiesAnd Global Strategic Alliances

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Overview

The Nature of Global Strategic Partnerships

Success Factors Alliances between Manufacturer &

Marketer International partnerships in developing

countries Co-operative Strategies in Japan: keiretsu Beyond Strategic Alliances Summary

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Learning ObjectivesBe cognizant of global strategic

partnerships – GSPs Recognize success factors of

GSPsLearn about key characteristics

of Japanese keiretsu & their effects on competition

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Demands on Strategic Alliances

Competitive collaborations offer significant advantagesCharacteristics:

Participants remain independent following to the formation of the alliance

Participants share the benefits of the alliance as well as control over the performance of assigned tasks

Participants make ongoing contributions in technology, products and other key strategic areas

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Global Strategic Partnership

Two or more companies develop a joint long-term strategy

The relationship is reciprocalVision & efforts are truly globalTransfer of resources between partnersPartner must know their core strength and be able to

defend their positionWhen in new markets, partners must retain identities

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Success Factors of Alliances

MissionStrategyGovernanceCultureOrganisationManagement

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Four Principles of GSPs

1. Partners are still in competition with each other

2. Some conflict is to be expected

3. Must understand where cooperation ends & competitive compromise begins

4. Learning from partners is critical

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Case Examples of Partnership

CFM International/GE/Snecma- A success storyAT&T/Olivetti - A FailureBoeing/Japan - A Controversy

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Co-operative Strategies in Japan:Keiretsu

Interbusiness alliance or enterprise group, where different companies or company groups are intertwined

Operates in a broad spectrum of marketsKeiretsu executives sit on each other`s boards & share

informationForeign competitors interpret keiretsu relations as

cartels which dominate the market and restrict competition

The most famous keiretsu are Mitsui and Mitsubishi

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Beyond Strategic Alliances

Information, communication technologies and globalisation have fostered new forms of strategic alliances:

Relationship enterprise Groups of firms in different industries will be held together by

common goals that encourages them to act like a single firm

Virtual corporation Multiple co-operations which are employed only when needed

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SummaryCompanies can choose among a wide range of

alternatives, when participating in foreign markets

Ownership requires substantial resources, but offers full control

Co-operative strategies include global strategic partner-ships, the Japanese keiretsu or the virtual enterprise