Study On Strategic Alliances Business Essay

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A strategic alliance is when two or more businesses join together for a set period of time. The businesses usually are not in direct competition but have similar products and / or services that are directed towards the same target audience. Because competitive markets keep improving what you can get from transactions, an alliance must stay ahead of the market by making continuous advances. Strategic alliance is a primary form of cooperative strategies. A strategic alliance is a partnership between firms whereby resources, capabilities, and core competences are combined to pursue mutual interests.

Alliances can be structured in various ways, depending on their purpose. Non-equity strategic alliances, equity strategic alliances and joint ventures are the three basic types of strategic alliances.

Orange UK is a mobile network operator and internet service provider in the United Kingdom. It has acquired by France Telecom, boasting of 17 million customers through its mobile and broadband services.

Orange UK currently offers two mobile phone packages; "pay as you go" and "pay monthly" service plans.

Orange UK operates a GPRS, EDGE and 3G service and is in the process rolling out of HSDPA network. Orange's 2G network covers 99% of the UK population and has the largest integrated 3G/2.5 G network in the UK. In addition to this Orange UK provides DSL services, under the same brand.

Pakistan Mobile Communication Limited, better known as Mobilink GSM is a telecommunication services provider in Pakistan. The company is Pakistan's leading cellular operator with a subscriber base of 31.5 people and market share of 32% as of June 2010.

Mobilink started operations in 1994 as the first GSM cellular mobile service in Pakistan by Motorola Inc. later it was acquired by Orascom, an Egypt based multi national company.

In addition to cellular service, the Orascom group is diversifying its service portfolio by setting up new businesses and also expanding through acquisitions. They have also started DSL broadband service through WiMax based technology under the label of 'Mobilink Infinity'.

Why strategic alliances?

In the new economic, strategic alliances enable business to gain competitive advantage through access to a partner's resources including markets, technologies, capital and people.

Orange UK's teaming up with Mobilink GSM will add complimentary resources and capabilities, enabling the participants to grow and expand more quickly and efficiently. Especially fast growing companies like Mobilink GSM rely heavily on alliances to extend their technical and operational resources. In the process, they save time and boost productivity by not having to develop their own from scratch. They are then freed to concentrate on innovation and their core business.

Many fast growing technological companies use strategic alliances to benefit from more-established channels of distribution, marketing or brand reputation of bigger, better known players. However, more traditional businesses tend to enter alliances for reasons such as geographic expansion, cost reduction, manufacturing and other supply chain synergies.

Planning for a Successful Alliance:

Before entering into a strategic alliance it is important for the stake holders of both Orange UK and Mobilink GSM to give enough thought to the structure of the relationship and details of how it will be manages, implemented and monitored.

Define expected outcomes from the relationship for all the parties in the strategic alliance.

Define and document the elements provided by each party, and the benefits a successful alliance brings to each.

Identify the results that will cause the alliance to be most beneficial to you business and define the structure and operating issues that need to be addressed to achieve these results.

Protect the company's intellectual property rights through legal agreements and restrictions when transferring propriety information.

Define the basics of how you will operate.

Be certain that the company cultures are compatible and the parties can operate with an acceptable level of trust.

Effective Business Partnerships

10 Key Features:

The voluntary nature of partnerships. The partners have clear and common goals based on mutual benefits.

Common interest. Partnerships are what enables many companies to make continuous improvements. By sharing with others, you can direct your resources and capabilities to projects you consider most important.

Synergy - the concept of value added or the total being greater than the sum of its individual parts.

The mutual dependency that arises from sharing risks, responsibilities, resources, competencies and benefits.

Explicit commitment or agreement on the part of the participants.

Working together. In the most strategic partnerships, the partners work together at all levels and stages, from the design and governance of the initiative to implementation and evaluation.

Complementary support. Focus on the firm's resource on what you do best and what creates sustainable competitive advantage and tap to the resources of others for the rest. To decide why, when and how to partner with other for complementary resources., weigh the small amount of cost savings that doing non-core-competence tasks might bring against the distraction and investment that will require to stay up-to-date.

Shared competencies and resources - partnerships are a mechanism to leverage different types of resources and competencies, including, but not only, money.

Effective communication between strategic business partners should be regular, open, transparent, with accountable structures for joint decision making and conflict resolution.

Respect and trust between the partners is at the core of today's complex and rapidly changing knowledge economy. It is one of the most efficient mechanisms for governing innovative business partnerships. With trust as foundation, the companies can share their know-how to achieve synergy.

The seven Dimensions of Strategic Innovation:

The strategic innovation framework weaves together seven dimensions, that Orange UK and Mobilink GSM need to consider in order to achieve their desired outcome.

A management innovation process, combining non-traditional approaches to business strategy.

Strategic alignment that helps build support.

Industry foresight and understanding emerging trends.

Consumer / customer insight, helping to understand expressed and unexpressed needs.

Core competencies and technologies leveraging and extending corporate assets.

Organizational readiness and the ability to take prompt action in an emergency.

Disciplined implementation as well as managing the path from inspiration to business impact.

Involving Stakeholders in the Planning of Change:

Creating a plan for involving as many people as possible, as early as possible, in the change process is necessary, especially when forming an alliance, so that everybody involved in the business, who will be impacted by the change have can adept accordingly.

Orange UK should involve all stakeholders, process owners, and employees who will feel the impact of the changes, as much as possible, in the learning, planning, decisions, and implementation of the change. Often, in change management, a small group of employees learns important information about change and change management. If they fail to share the information with the rest of the employees, the remaining employees will have trouble catching up with the learning curve.

If a small group makes the change management plans, employees affected by the decisions will not have had needed time to analyze, think about, and adjust to the new ideas. If you leave employees behind, at any stage of the process, you open the door in your change management process, for misunderstanding, resistance, and hurt.

Even if employees cannot affect the overall decision about change, involve each employee in meaningful decisions about their work unit and their work.

Build measurement systems into the change process that tell people when they are succeeding or failing. Provide consequences in either case. Employees who are positively working with the change need rewards and recognition. After allowing some time for employees to pass through the predictable stages of change, negative consequences for failure to adopt the changes, are needed.

You cannot allow the nay-sayers to continue on their negative path forever; they sap your organization of time, energy, and focus, and eventually, affect the morale of the positive many. The key is to know, during your change management process, when to say, enough is enough.

Help employees feel as if they are involved in a change management process that is larger than themselves by taking these actions to effectively involve employees in change management.

Stakeholder involvement is based upon the belief that expertise does not lie solely with program professionals. Stakeholders are persons or organizations that have investments in the content of a program, or in the dissemination and evaluation of a program. Over the last several years the interpretation of stakeholder involvement has changed as programs have focused not just on individuals and families, but the broader ecology including neighborhood, workplace, schools, and places of worship, communities and the society. Work in the area of teen pregnancy prevention, for example, as in the general public health, social service and education fields, involves partnerships. Consequently, decisions regarding programs should include the considerations and perspectives of multiple stakeholders.

Stakeholders offer important insight into each phase of program planning, implementation and evaluation. Stakeholders are most commonly involved at the beginning stages of program planning. They are able to provide insight for the various needs that a program or curriculum should meet. Experience shows that once the goals have been set in the first part of program development, stakeholders are sometimes not consulted in latter stages of program implementation and evaluation. This is unfortunate because stakeholders have the potential to illuminate issues and needs during the course of program implementation (Banach & Gregory, 2001). Frequently stakeholders who participate in an initial needs assessment may not be the same stakeholders who ultimately sustain the program. Consequently, eliciting on-going feedback and keeping lines of communication open are crucial to program success. This is particularly true in community-based youth development programs. A broad range of stakeholders has the knowledge, daily life experiences and expertise that can contribute to program success.

Stakeholders may be involved in multiple roles and various functions. Focus groups may be conducted to get initial ideas and reveal community norms, history and players. Community mapping may be conducted to learn about the important features, places and events. Volunteer opportunities, advisory committees, participation in hiring processes, program committees, and various other means can be explored. The important point is that if stakeholders are valued, they will be welcomed and their voices heard.

How well you listen to and respond to ALL of your stakeholders' issues - and are seen to be doing so - is a significant measure of the effectiveness of your management of these relationships.

SYSTEMS TO INVOVLE STAKEHOLDERS IN PLANNING OF CHANGE:

Stakeholder Management is an important discipline that successful architecture practitioners can use to win support from others. It helps them ensure that their projects succeed where others fail.

The benefits of successful Stakeholder Management are that:

The most powerful stakeholders can be identified early and their input can then be used to shape the architecture; this ensures their support and improves the quality of the models produced.

Support from the more powerful stakeholders will help the engagement win more resource, thus making the architecture engagement more likely to succeed.

By communicating with stakeholders early and frequently, the architecture team can ensure that they fully understand the architecture process, and the benefits of enterprise architecture; this means they can support the architecture team more actively when necessary.

The architecture engagement team can more effectively anticipate likely reactions to the architecture models and reports, and can build into the plan the actions that will be needed to capitalize on positive reaction whilst avoiding or addressing any negative reactions.

It is essential in any initiative to identify the individuals and groups within the organization who will contribute to the development of the architecture, identify those that will gain and those that will lose from its introduction, and then develop a strategy for dealing with them.

Steps in the Stakeholder Management Process

The following sections detail recommended Stakeholder Management activity.

Identify Stakeholders:

Identify the key stakeholders of the enterprise architecture.

The first task is to brainstorm who the main enterprise architecture stakeholders are. As part of this, think of all the people who are affected by it, who have influence or power over it, or have an interest in its successful or unsuccessful conclusion.

It might include senior executives, project organization roles, client organization roles, system developers, alliance partners, suppliers, IT operations, customers, etc.

When identifying stakeholders there is a danger of concentrating too heavily on the formal structure of an organization as the basis for identification. Informal stakeholder groups may be just as powerful and influential as the formal ones.

Most individuals will belong to more than one stakeholder group, and these groups tend to arise as a result of specific events.

Look at who is impacted by the enterprise architecture project:

Who gains and who loses from this change?

Who controls change management of processes?

Who designs new systems?

Who will make the decisions?

Who procures IT systems and who decides what to buy?

Who controls resources?

Who has specialist skills the project needs?

Who has influence?

In particular, influencers need to be identified. These will be well respected and moving up, participate in important meetings and committees (look at meeting minutes), know what's going on in the company, be valued by their peers and superiors, and not necessarily be in any formal position of power.

Although stakeholders may be both organizations and people, ultimately the enterprise architecture team will need to communicate with people. It is the correct individual stakeholders within a stakeholder organization that need to be formally identified.

Managing Resistance to Change:

Resistance to change can occur because of changes that had been planned and implemented inappropriately. They should be cooperative and participating by providing guidance and advice and criticism in order to manage the change process goes well. With support, suggestions and criticisms from members of organizations often get their ideas and innovations to the process of change. We can change the negative energy of resistance into a positive contribution to the process of change.

Management role to facilitate and provide support for change through the system and device that is conducive. For example provides a medium for employees to provide feedback on the changes, the device that lets employees know the progress and advancement process of change, there is a system of coaching and Counseling from a chief of staff.

Negotiation is required in the process of change. Top management negotiations for an all out support changes. Support from management can be a commitment in an incentive and reward programs. Reward systems can be a carrot and stick, anyone who contributed towards the changes will get the prize and who impede the change will get the punishment.

Strategies to manage resistance to change can be made with the manipulation that is to replace or move an influential person for groups of resistance. By distancing the person is the power of resistance groups will be weakened and is more easily influenced.

Last strategy is to force. This action is done if all actions have been carried out yet able to overcome resistance to change. If changes must be immediately implemented and not be delayed is done under compulsion to follow the process of change so that energy is allocated to implement changes.

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