IBS: Les 6

Question 1

International strategic alliances

Answer 1

1. Equity alliances (equity joint-ventures and cross-shareholdings)
2. Purely contractual alliances

Question 2

Hamel et al. (alliances between international rivals)

Answer 2

Learning race between Asian and Western firms. Often won by the latter because they bring in tacit routines

Question 3

Anderson and Jap (Alliances in general)

Answer 3

Een partner kan van de andere partner afhankelijk worden door asymmetrical learning of door asymmetrical alliance specific investments

Question 4

Anderson and Jap: safeguards to avoid dependence, bounded reliability, and conflict

Answer 4

• Swapping hostages: symmetrical alliance-specific investments
• Attention to (and investment in) alternative partners
• Regular re-evaluation of the alliance relationship

Question 5

Kale and Anand: equity JVs between market-seeking MNEs and local firms in an emerging economy

Answer 5

Partner contributions:
MNE: NLB FSAs such as technology, management skills, and financial capital
Local firm: LB FSAs such as governmental ties, market knowledge, distribution channels and local brands.

Question 6

Ghemawat and Ghadar: 2 beliefs which have made cross-border M&As very popular

Answer 6

1. globalization causes consolidation within industries, forcing firms to undertake M&As in order to survive
2. M&As yield synergies and thus create value

Question 7

Options for potential acquirers

Answer 7

1. Grant autonomy to acquired firm to maintain its routines and recombination capabilities
2. Learn how to integrate acquired firms
3. Don’t do it (choose a different strategy)
   => strategic alliances, which are preferred over M&As when: - some of target’s resources are not needed
   - these ‘unwanted’ resources are difficult to dispose of
   -an M&A would upset the target’s employees and thus cause huge integration challenges
   -an M&A is politically sensitive