Forming A Strategic Alliance †Free Sample - Myassignmenthelp.Com

Question: 1.Explain theissues, challenges, or disadvantages to forming a strategic alliance. Give an example to provide a context to your discussion. Answer: For growing as an organisation and prospering with each passing year, there is a necessity to find innovative and creative strategies to expand and penetrate into new markets. Strategic alliance relationships have grabbed the attention of business analysts in recent times as it serves as a tool for both parties involved to increase the capital and brand awareness without experiencing negative financial impact. Like most business strategic tools, there are certain issues or challenges involved with a strategic alliance that is to be discussed herein. Strategic alliances come with some significant difficulties, the most important one being the fact that one party handling all the business internally might now have to rely on a second party. If the other party has some hidden agendas, the project might suffer. For example, a party might have hidden agendas related to profit extraction and might show hide the actual cost and profit details. Collateral damage would arise in such cases that can also lead to possible career derailment for employees. All companies, big or small, have difficulties while carrying out their first strategic alliance venture due to loss of control. The decision-making process is usually difficult when a multi-dimensional approach is required. The potential challenges pertaining to strategic alliances include selecting the right partners, upholding honesty and trust, and proper reassessment of the alliance. Negotiating the parameters that describe these aspects is critical. An organisation entering into a strategic alliance for the very first time has to be mentally prepared for the control issues. Simultaneously, an organisation entering into an alliance with a first timer has to be patient and show professionalism (Jones and George). References Jones, Gareth, and Jennifer George.Contemporary management. McGraw-Hill Higher Education, 2015.