Internationalization through Strategic Alliances & Joint Ventures Helena Grba 0201823 Ulrico...
-
date post
22-Dec-2015 -
Category
Documents
-
view
218 -
download
0
Transcript of Internationalization through Strategic Alliances & Joint Ventures Helena Grba 0201823 Ulrico...
Internationalization through Internationalization through
Strategic Alliances & Joint Strategic Alliances & Joint
VenturesVentures
Helena Grba 0201823
Ulrico Figà-Talamanaca 0200754
Kasia Kozirog 0208736
Anne-Sophie Le Boubennec 0200110
PlanPlan
Introduction
I – Strategic Alliances
II – Joint Ventures
III – Network Groups
IV – Case Study
Conclusion
IntroductionIntroduction
Deciding whether to go abroad Advantages
Risks
Deciding in market to enter
Deciding how to enter the
market
IntroductionIntroduction
I – Strategic Alliances
II – Joint Ventures
III – Network Groups
IV – Case Study
Conclusion
Deciding how to enter the market
Indirect or direct exporting
Licensing
Joint Ventures
Direct Investment
IntroductionIntroduction
I – Strategic Alliances
II – Joint Ventures
III – Network Groups
IV – Case Study
Conclusion
I – Strategic AlliancesI – Strategic Alliances “ A strategic alliance typically includes
a constellation of agreements
involving technology swaps, joint
research and development or co-
development, and/or the sharing of
complementary assets, such as where
one party does manufacturing and the
other distribution for a co-developed
product”
Introduction
I – Strategic AlliancesI – Strategic Alliances
II – Joint Ventures
III – Network GroupsIII – Network Groups
IV – Case Study
Conclusion
Several Kinds of Strategic Several Kinds of Strategic AlliancesAlliances
Licensing : Manufacturing industries Services & Franchises
Joint Venture : Specialization across partners Shared value adding
A particular one : Network Groups
IntroductionIntroduction
I – Strategic AlliancesI – Strategic Alliances
II – Joint Ventures
III – Network Groups
IV – Case Study
Conclusion
II – Joint VenturesII – Joint Ventures
„Joint ventures are business entities that are owned by two or more firms that share resources and skills"
IntroductionIntroduction
I – Strategic Alliances
II – Joint VenturesII – Joint Ventures
III – Network Groups
IV – Case Study
Conclusion
Types of Joint Ventures
Nonequity joint ventures
Equity join venture
Scale Link
IntroductionIntroduction
I – Strategic Alliances
II – Joint VenturesII – Joint Ventures
III – Network Groups
IV – Case Study
Conclusion
Nonequity Joint VenturesNonequity Joint Ventures
IntroductionIntroduction
I – Strategic Alliances
II – Joint VenturesII – Joint Ventures
III – Network Groups
IV – Case Study
Conclusion
Equity Joint VenturesEquity Joint Ventures IntroductionIntroduction
I – Strategic Alliances
II – Joint VenturesII – Joint Ventures
III – Network Groups
IV – Case Study
Conclusion
Firm A
Firm B
Joint Venture
Frim A 50%Frim B 50%
Frim A
Frim B
Scale Joint VenturesScale Joint Ventures IntroductionIntroduction
I – Strategic Alliances
II – Joint VenturesII – Joint Ventures
III – Network Groups
IV – Case Study
Conclusion
Link Joint VenturesLink Joint Ventures
Firm A Joint Venture
Frim A 50%Frim B 30%Frim C 20%
Frim A
Frim B
Firm C
IntroductionIntroduction
I – Strategic Alliances
II – Joint VenturesII – Joint Ventures
III – Network Groups
IV – Case Study
Conclusion
Why Joint Ventures?Why Joint Ventures?
To take existing products to foreign markets
To diversify into new business
To strengthen the existing business
To bring the foreign products to local
markets
IntroductionIntroduction
I – Strategic Alliances
II – Joint VenturesII – Joint Ventures
III – Network Groups
IV – Case Study
Conclusion
Strengthening The Existing Business
To obtain economies of scale, new technology and know-how or to diminish the risk of the project
Existing market and existing product
IntroductionIntroduction
I – Strategic Alliances
II – Joint VenturesII – Joint Ventures
III – Network Groups
IV – Case Study
Conclusion
Taking Products To Foreign Markets
Existing products and new market
Company often looks for a partner in the same branch. Such a partner will have a good feel for the local market
Joint venture covers only some activities
IntroductionIntroduction
I – Strategic Alliances
II – Joint VenturesII – Joint Ventures
III – Network Groups
IV – Case Study
Conclusion
Bringing Foreign Product To
Local Markets Protection against new
technology and new competitors
Better use of existing manufacturing plants and of their distribution channels
Existing market and new products
IntroductionIntroduction
I – Strategic Alliances
II – Joint VenturesII – Joint Ventures
III – Network Groups
IV – Case Study
Conclusion
Diversification Into New Business
Joint venture may be used to
enter both into the new
business and the new market
IntroductionIntroduction
I – Strategic Alliances
II – Joint VenturesII – Joint Ventures
III – Network Groups
IV – Case Study
Conclusion
Access to Expertise
Cost Savings Manufacturing
Capability Reduced Risk
Sharing of Future Profits
Creating a Competitor or a Potential Competitor
Distractions
IntroductionIntroduction
I – Strategic Alliances
II – Joint VenturesII – Joint Ventures
III – Networks Group
IV – Case Study
Conclusion
Advantages and Disadvantages
Transaction Cost Theory of Equity Joint Venture
Main Objectives
Economie of Scale
Overcoming Entry Barriers
Pooling Knowledge
Reducing Political Risk
IntroductionIntroduction
I – Strategic AlliancesI – Strategic Alliances
II – Joint VenturesII – Joint Ventures
III – Network Groups
IV – Case Study
Conclusion
Transaction Cost Theory of Equity Joint Venture
Device inefficient market for
intermediate inputs
Raw Materials and
Components
Knowledge
Distribution
Loan Capital
IntroductionIntroduction
I – Strategic AlliancesI – Strategic Alliances
II – Joint VenturesII – Joint Ventures
III – Network Groups
IV – Case Study
Conclusion
Transaction Cost Theory of Equity Joint Venture
Raw Materials and Components
Loan Capital
Distribution Economies of scale Quality Control
IntroductionIntroduction
I – Strategic AlliancesI – Strategic Alliances
II – Joint VenturesII – Joint Ventures
III – Network Groups
IV – Case Study
Conclusion
Transaction Cost Theory of Equity Joint Venture
Knowledge Tacit KnowledgeMarketing
KnowledgeCountry
Specific
Joint Ventures vs. Licensing
Patent rights Patent Rights+ Tacit Knowledge
IntroductionIntroduction
I – Strategic AlliancesI – Strategic Alliances
II – Joint VenturesII – Joint Ventures
III – Network Groups
IV – Case Study
Conclusion
Transaction Cost Theory of Equity Joint Venture
Acquisition Acquisition
Greenfield InvestmentGreenfield Investment Joint VentureJoint VentureVS.
Assets :
Firm – Specific
Public Goods
Employees
IntroductionIntroduction
I – Strategic AlliancesI – Strategic Alliances
II – Joint VenturesII – Joint Ventures
III – Network Groups
IV – Case Study
Conclusion
III – Network GroupsIII – Network GroupsDefinition
Companies joined forces for a common purpose that is to say in a large overarching relationship.
Alliance groups are a number of companies linkes together by through collaborative agreements.
IntroductionIntroduction
I – Strategic Alliances
II – Joint Ventures
III – Network GroupsIII – Network Groups
IV – Case Study
Conclusion
SchemaSchema
IntroductionIntroduction
I – Strategic Alliances
II – Joint Ventures
III – Network GroupsIII – Network Groups
IV – Case Study
ConclusionExemple of a Structure Group in 1994Exemple of a Structure Group in 1994
H-P
HitachiHitachi
HitachiHitachiSamsungSamsung
SequoiaSequoia
StratusStratus
Goals and AdvantagesGoals and Advantages
New technology and implantation
« Snowball effect »
Maximize joint volume in order to
exploit Economie of Scale
Cooperation & Exploitation
Competitive advantages
IntroductionIntroduction
I – Strategic Alliances
II – Joint Ventures
III – Network GroupsIII – Network Groups
IV – Case Study
Conclusion
ManagementManagement
Differences in Alliance Network SizePattern of GrowthComposition Internal CompetitionGovernance Structure
IntroductionIntroduction
I – Strategic Alliances
II – Joint Ventures
III – Network GroupsIII – Network Groups
IV – Case Study
Conclusion
The ConstraintsThe Constraints
Organizational Dependance
Strategic Gridlock
IntroductionIntroduction
I – Strategic Alliances
II – Joint Ventures
III – Network GroupsIII – Network Groups
IV – Case Study
Conclusion
Key FactsKey Facts
The partnership complement one another
Depends of the competitive advantages
Carefull management
IntroductionIntroduction
I – Strategic Alliances
II – Joint Ventures
III – Network GroupsIII – Network Groups
IV – Case Study
Conclusion
IntroductionIntroduction
I – Strategic Alliances
II – Joint Ventures
III – Network GroupsIII – Network Groups
IV – Case Study IV – Case Study
Conclusion
OSG Microelectronics
50-50 JV between Olin Corporation (US) and CIBA-GEIGY AG (Switzerland) in January 1, 1991
Objective of becoming an innovative supplier of photoresist and polyamide products and services to semiconductor customers worldwide.
Synergistically combine of unique technological capabilities
Operating with a total quality Management (TQM) philosophy to reach a goal of innovation and customer satisfaction.
Early success in the new venture - after six months of operation OSG became number three in microelectronics industry
IntroductionIntroduction
I – Strategic Alliances
II – Joint Ventures
III – Network GroupsIII – Network Groups
IV – Case Study IV – Case Study
Conclusion
OSGOSG Structure & Management Structure & Management Complex AND decentralized Departments in Europe, North America and
Pacific Rim, coordinated on a global basis, "Triad alliance"; photoresist supplier
represented in all three major electronics markets of the world.
90% of the OSG staff former Olin employees HR Management area contracted from Olin; to
minimize the disruption to employees Olin HR policies was originally adopted.
Dissatisfaction of former CIBA-GEIGY executives and employees
Necessary move for the Ardsley group to East Providence
IntroductionIntroduction
I – Strategic Alliances
II – Joint Ventures
III – Network GroupsIII – Network Groups
IV – Case Study IV – Case Study
Conclusion
The major challenge: JV Integration
Integration of former CIBA-GEIGY staff into venture:
Company handbook and newsletter: again originally taken from Olin – equals partners?
Divided loyalty to the parent firm and to the JV
Physical relocation for Ardsley group, causing uncertainty and anger
Staffing dilemma: "2-year-no-bid-policy"
The Solution: Forging a JV IdentityThe Solution: Forging a JV Identity
Focus on communication: important for reaching personal goals as well as to the strategic requirements of the venture
Creating a new and "fair" HR policy
Developing a feeling of loyalty by employees to the JV
Creating a new value system unique to OSG
IntroductionIntroduction
I – Strategic Alliances
II – Joint Ventures
III – Network GroupsIII – Network Groups
IV – Case Study IV – Case Study
Conclusion