Strategic Alliances - Essay Sample

The modern business world has been the center stage of most strategic alliances between companies in different markets. Ideally, a strategic alliance is aimed at creating an agreement for two or more business parties to pursue given objectives or goals that are defined in business terms while still remaining to be independent entities. The strategic alliances that exist in the business world have taken that approach of providing both parties with some form of the advantage gained from the relationship (Albers, Wohlgezogen & Zajac, 2016). The advantage may be gained through various aspects mostly including the access to unique and varied sets of resources that enhance and expand business operations for the better.

One example of such partnerships is the partnership between Lyft and General Motors (GM). Lyft is a company that works to manage the transportation app going by the same name. The purpose of the app is to help users locate nearest transportation services at the convenience of their internet enabled phones. On the other hand, GM is a motor manufacturing company that has a wide market share on a global basis. The strategic alliance between these two major industry players in their respective market was mainly aimed at creating the availability of autonomous cars to consumers in regard to proximity of the services.

General Motors has done extensive work in manufacturing autonomous cars. Autonomous cars are vehicles that are essentially driverless. The role to be played with GM will be the provision of the existing infrastructure that they have are using in the development of autonomous cars. On the other side, Lyft is a transportation company that runs through user requests for rides in regard to the location of the nearest Lyft car. Furthermore, this transportation company has an already established set of drives that operate their vehicles or rather associated vehicles. The role that Lyft will play in the strategic alliance is one of providing an automated system for matching drivers, passengers, payments and routing in the transportation sector.

As seen in the previous paragraph, the two companies have different and important roles to play in the partnership. The strategic partnership will, therefore, entail the development of a network of autonomous vehicles on an online platform that is user-oriented. This feat will be achieved by the resource brought by both companies into the partnership. Due to the nature of the strategic partnership, the two companies have very different business structures that are important in attaining the objectives of the alliance (Steinhilber, 2013). Furthermore, the two companies need each other to realize the given objectives thus creating a sense of dependence on each other on the business angle (Brouthers, Nakos & Dimitratos, 2015). Therefore, the two companies are bound to gain a significant competitive advantage in their respective markets as defined by the strategic alliance objectives.

Indeed, strategic alliances are bound to make both parties gain considerably in the joint business venture. However, these companies are also bound to exist independently but carry out joint operations involved in the partnership. The joint operations aim at using the varying set of resources provided by each company to realize a common business goal. The two companies will work together for the purpose of the strategic partnership but still be able to maintain their other separate business operations independently without interference from operations involved in their major business interests.

References

Albers, S., Wohlgezogen, F., & Zajac, E. J. (2016). Strategic alliance structures: An organization design perspective. Journal of Management, 42(3), 582-614.

Brouthers, K. D., Nakos, G., & Dimitratos, P. (2015). SME entrepreneurial orientation, international performance, and the moderating role of strategic alliances. Entrepreneurship Theory and Practice, 39(5), 1161-1187.

Steinhilber, S. (2013). Strategic Alliances: three ways to make them work. Harvard Business Press.