Strategic Alliance Management & Social Media

Phoenix Based SGB Media Group Announces Major Strategic Alliances During 2nd Quarter

Phoenix, AZ (PRWEB) August 14, 2010

via www.prweb.com

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About the Association of Strategic Alliance Professionals (ASAP)

Dedicated to the Practice of Alliance Formation Established in 1998, ASAP is the only professional membership association dedicated to alliance formation. ASAP's Objectives

* Create a distinct professional identity for executives and managers of strategic alliances

* Set standards of professional performance in the formation and management of strategic alliances

* Support the professional development of its members by promoting education, communication and fellowship through training and educational programs, conferences, workshops and on-line exchange.

 

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* Create awareness of the contributions of strategic alliances and strategic alliance professionals among corporate managers and executives and among the general public

* Sponsor, conduct, publish and disseminate research regarding advances and best practices in the field of strategic alliances

* Serve as a repository and exchange for resources to support the professional development of its members

More on Strategic Alliances

One of the fastest growing trends for business today is the increasing number of strategic alliances. According to Booz-Allen & Hamilton, strategic alliances are sweeping through nearly every industry and are becoming an essential driver of superior growth. Alliances range in scope from an informal business relationship based on a simple contract to a joint venture agreement in which for legal and tax purposes either a corporation or partnership is set up to manage the alliance.

For small businesses, strategic alliances are a way to work together with others towards a common goal while not losing their individuality. Alliances are a way of reaping the rewards of team effort - and the gains from forming strategic alliances appear to be substantial. Companies participating in alliances report that at much as 18 percent of their revenues comes from their alliances.

But it isn't just profit that is motivating this increase in alliances. Other factors include an increasing intensity of competition, a growing need to operate on a global scale, a fast changing marketplace, and industry convergence in many markets (for example, in the financial services industry, banks, investment firms, and insurance companies are overlapping more and more in the products they supply). Especially in a time when growing international marketing is becoming the norm, these partnerships can leverage your growth through alliances with international partners. Rather than take on the risk and expense that international expansion can demand, one can enter international markets by finding an appropriate alliance with a business operating in the marketplace you desire to enter.

A strategic alliance is essentially a partnership in which you combine efforts in projects ranging from getting a better price for supplies by buying in bulk together to building a product together with each of you providing part of its production. The goal of alliances is to minimize risk while maximizing your leverage and profit. Alliances are often confused with mergers, acquisitions, and outsourcing. While there are similarities in the circumstances in which a business might consider one these solutions, they are far from the same. Mergers and acquisitions are permanent, structural changes in how the company exists. Outsourcing is simply a way of purchasing a functional service for the company.

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What is a strategic alliance?

From Wikipedia:

 

A Strategic Alliance is a formal relationship between two or more parties to pursue a set of agreed upon goals or to meet a critical business need while remaining independent organizations.

Partners may provide the strategic alliance with resources such as products, distribution channels, manufacturing capability, project funding, capital equipment, knowledge, expertise, or intellectual property. The alliance is a cooperation or collaboration which aims for a synergy where each partner hopes that the benefits from the alliance will be greater than those from individual efforts. The alliance often involves technology transfer (access to knowledge and expertise), economic specialization ^[1], shared expenses and shared risk.

Contents [hide] 1 Types of strategic alliances 2 Stages of Alliance Formation 3 External links 4 Footnotes

[edit] Types of strategic alliances

Various terms have been used to describe forms of strategic partnering. These include ‘international coalitions’ (Porter and Fuller, 1986), ‘strategic networks’ (Jarillo, 1988) and, most commonly, ‘strategic alliances’. Definitions are equally varied. An alliance may be seen as the ‘joining of forces and resources, for a specified or indefinite period, to achieve a common objective’.

According to Yoshino and Rangan^[2] the Internationalisation Strategies can be categorized using the model displayed at the right side.

[edit] Stages of Alliance Formation

A typical strategic alliance formation process involves these steps:

• Strategy Development: Strategy development involves studying the alliance’s feasibility, objectives and rationale, focusing on the major issues and challenges and development of resource strategies for production, technology, and people. It requires aligning alliance objectives with the overall corporate strategy.
• Partner Assessment: Partner assessment involves analyzing a potential partner’s strengths and weaknesses, creating strategies for accommodating all partners’ management styles, preparing appropriate partner selection criteria, understanding a partner’s motives for joining the alliance and addressing resource capability gaps that may exist for a partner.
• Contract Negotiation: Contract negotiations involves determining whether all parties have realistic objectives, forming high calibre negotiating teams, defining each partner’s contributions and rewards as well as protect any proprietary information, addressing termination clauses, penalties for poor performance, and highlighting the degree to which arbitration procedures are clearly stated and understood.
• Alliance Operation: Alliance operations involves addressing senior management’s commitment, finding the calibre of resources devoted to the alliance, linking of budgets and resources with strategic priorities, measuring and rewarding alliance performance, and assessing the performance and results of the alliance.
• Alliance Termination: Alliance termination involves winding down the alliance, for instance when its objectives have been met or cannot be met, or when a partner adjusts priorities or re-allocates resources elsewhere.

The advantages of strategic alliance includes:

1. Allowing each partner to concentrate on activities that best match their capabilities.
2. Learning from partners & developing competences that may be more widely exploited elsewhere
3. Adequency a suitability of the resources & competencies of an organization for it to survive.

There are four types of strategic alliances: joint venture, equity strategic alliance, non-equity strategic alliance, and global strategic alliances.

• Joint venture is a strategic alliance in which two or more firms create a legally independent company to share some of their resources and capabilities to develop a competitive advantage.
• Equity strategic alliance is an alliance in which two or more firms own different percentages of the company they have formed by combining some of their resources and capabilities to create a competitive advantage.
• Nonequity strategic alliance is an alliance in which two or more firms develop a contractual-relationship to share some of their unique resources and capabilities to create a competitive advantage.
• Global Strategic Alliances working partnerships between companies (often more than 2) across national boundaries and increasingly across industries. Sometimes formed between company and a foreign government, or among companies and governments

[edit] External links

• Association of Strategic Alliance Professionals, Inc. Professional organization that serves those who manage strategic alliances and corporate partnerships.

• SMART- Strategic Merger & Alliance Resource Training program Metropolitan Detroit program assisting nonprofit organizations with the strategic alliance process.

• / Example of Strategic Alliance program Example of strategic Alliance program with Oracle and Unisys.

• Example of coaching approach to cooperations smE-MPOWER approach for coaching the formation of strategic alliances developed within a European Union funded public project. Resulting international network of cooperation coaches as a learning community.

Introduction to "Strategic Alliance Management & Social Media" Blog

A Strategic Alliance is a formal relationship between two or more parties to pursue a set of agreed upon goals or to meet a critical business need while remaining independent organizations. In this day of social networking many of these alliances are being developed over the internet and thus changing the way in which strategic alliances are formed, the reasons they are formed and how they are managed.

This blog's purpose; therefore, is to discuss strategic alliance management within the context of social media marketing and social networking. I welcome comments and thoughts from the readership and look forward to an ongoing publication.