S18: M&A & Cooperative strategies

Question 1

What is a business-level cooperative strategy?

Answer 1

Firms combine some of their resources to create competitive advantage by competing in one or more product markets

Question 2

What is a complementary strategic alliance?

Answer 2

Firms share some of their resources in complementary ways to create competitive advantage (ex: vertical and horizontal)

Question 3

What is the competition response strategy?

Answer 3

Formed to respond to competitor’s actions, especially strategic actions (ex: you see your competitor doing this, you try to do something in return that is similar to what your competitor did)

Question 4

What is the uncertainty/competition-reducing strategy?

Answer 4

Uncertainty: used to hedge against risks created by an uncertain competitive environment (ex: new product market)

Competition: used to avoid excessive competition while the firm marshals its resources to improve its strategic competitiveness