TECHNOLOGICAL INSTITUTE OF TEPIC

BUSINESS MANAGEMENT
STRATEGIC MANAGEMENT
SUMMARY OF COOPERATION STRATEGY

The cooperation strategy consists of two or more companies working to

achieve a common goal.
Strategic alliances are the primary type of cooperation strategy that
companies use. Collusion strategies are not used frequently,
but they are another kind of cooperation strategy. In the case of a strategy of
collusion, two or more companies cooperate in order to increase prices by
completely above the competitive level.

Las alianzas estratégicas como principal tipo de estrategia de cooperación

The strategic alliance is a cooperation strategy that consists of two or

more companies combine part of their resources and capabilities to create a
competitive advantage.
Strategic alliances allow companies to leverage resources and
capabilities they have, while working with their allies to
develop resources and capabilities that will be the basis of new advantages
competitive.
A competitive advantage gained through a cooperation strategy
it is usually called an advantage due to collaboration or relationships.

Three types of strategic alliances

The three main types of strategic alliances are: the joint venture.
venture, the strategic alliance with capital contribution and the alliance
strategic without contribution of social capital.

The joint venture is an alliance with which two or more

companies create an independent company from a legal standpoint
in order to share part of their resources and capabilities to develop
a competitive advantage. Joint ventures are very effective for
establish long-term relationships and transfer tacit knowledge. Given
that this knowledge cannot be encoded, it must be learned
through experiences like those that occur when people
companies were treated together in a joint venture.
The strategic alliance with social capital contribution consists of two or
more companies hold different percentages of the company that they have
constituted by combining part of its resources and capabilities to create
a competitive advantage.
The strategic alliance without contribution of capital consists of two or
more companies establish a contractual relationship to share part of
its unique resources and capabilities in order to create an advantage
competitive. With this type of strategic alliance, companies do not
they constitute a separate independent company and, therefore, do not
they have percentages in the social capital. For the same reason, alliances
 strategies of this kind are less formal and require less
commitment of the partners that joint ventures and alliances
strategic with contributions of social capital.

Generally, outsourcing contracts take the form of a partnership.

strategic without contribution of social capital.

Reasons for companies to form strategic alliances

Cooperation strategies have become an integral part of the landscape.

competitive and are of prime importance for many organizations.
Strategic alliances, among other benefits, allow partners to create
a value that they could not develop if they acted independently and enter into
the markets with greater speed. The effects of increased use of strategies
The cooperation is remarkable.
In essence, companies form strategic alliances to reduce competition.
improve their capabilities to compete, have access to resources, take advantage
opportunities and acquire strategic flexibility.
The unique competitive conditions of slow-cycle markets, of cycle
fast and normal cycle allow companies that use strategies of
cooperation achieves slightly different objectives.

Slow cycle markets

Companies in slow cycle markets often use alliances
strategies to enter restricted markets or establish franchises in
new markets.
Slow cycle markets are becoming increasingly rare in the landscape of the
twenty-first century competition for various reasons, including the privatization of the
industries and economies, the rapid expansion of capabilities and the internet to
the rapid dissemination of information and the speed at which advancements
technological advancements make it possible to quickly imitate even those products
they are very complex. The cooperation strategies can be very effective for you.
useful to companies that are transitioning from more or less protected markets
to others with more competition.

Fast cycle markets

Fast-cycle markets tend to be unstable, unpredictable, and complex.
The alliances between companies that currently have excess resources.
capabilities and others that have promising capabilities help that the
companies competing in fast cycle markets can transition with
effectiveness from the present to the future and also that they can enter quickly into the
new markets.
Normal or standard cycle markets
In normal cycle markets, which tend to be large and oriented towards the
economies of scale, it is likely that the alliances will be among partners who have
resources and capabilities that complement each other.
Companies can also cooperate in normal cycle markets with the
in order to acquire more market power.

Business-level cooperation strategy

The business-level cooperation strategy serves for the company

improve their performance in a product market. The organization formulates a
cooperation strategy at the business level when you think that the combination of
its resources and capabilities with those of one or more partners will create advantages.
competitiveness that she alone cannot create and that will lead to success in a market
specific to products. There are four cooperation strategies at the level of
businesses.

Complementary strategic alliances

Complementary strategic alliances are business alliances formed
in order for companies to share part of their resources and capabilities
in a way that complements them and allows them to develop competitive advantages.
There are two types of complementary strategic alliances: vertical and
horizontal.

Complementary vertical strategic alliance: In the case of an alliance

vertical complementary strategy, companies share their resources
and capabilities when they are at different stages of the value chain, to
to create a competitive advantage. Often, alliances
vertical complements are formed in reaction to changes in
entorno, es decir, sirven como medio para adaptarse a los cambios que
occur in this.
Horizontal complementary strategic alliance: A strategic alliance
horizontal complementary is that with which companies share
its resources and capabilities when they are at the same stage of the chain
of value to create a competitive advantage. Generally, companies
they use this type of alliance to focus on long-term opportunities
deadlines that exist for the development and distribution of products.
It is important to note that horizontal alliances may require that the
partners invest the same amount of resources, because these are rarely
they produce the same benefits for everyone.

Strategy to respond to the competition

In the competition, rivals imitate the competitive actions of their
counterparts are to attack them and respond to such actions they undertake to
compete against them. Companies use strategic alliances to
respond to the attacks from their competitors, but they can be difficult to
reverting and costly to operate, tend to ally more for strategic actions
that for the tactics.

Strategy to reduce uncertainty

Companies use business strategies, especially in the markets of
rapid cycle, to protect against risk and uncertainty. Also the
they are used in cases of uncertainty when entering new markets of
products or in emerging economies.
In other cases, companies form strategic business alliances to
reduce the uncertainty related to the development of new products or with
the establishment of a technological standard.

Strategy to reduce competition

Collusion strategies are used to reduce competition and differ from the
strategic alliances because they are often an illegal form of cooperation.
There are two types of collusion strategies: explicit collusion and
tacit collusion.
Explicit collusion occurs when companies negotiate in a way
direct to reach an agreement regarding the volume of production and to
price fixing with the purpose of reducing competition. The
explicit collusion strategies are illegal in the United States and in almost
all the encomiendas developed in the world.
Tacit collusion occurs when several companies in an industry
they observe both the competitive actions of others and their
responses and are based on them to coordinate, indirectly, their
decisions regarding reduction and prices. Tacit collusion leads to
resulting in a production volume below the level of competition and
prices above that level. In the case of tacit collusion, to
difference of what happens in explicit collusion, the companies do not
they negotiate the production and pricing decisions directly.
companies often use tacit collusion as a business strategy to
reduce competition in highly concentrated sectors.

Evaluation of cooperation strategies at the business level

Companies use business strategies to develop advantages.
competitive factors that contribute to a successful position and performance in the
specific product markets.
In order to develop a competitive advantage using an alliance, the set
particular of resources and capabilities that companies integrate through a
The alliance must be valuable, rare, difficult to imitate, and irreplaceable.
The evidence suggests that strategic business alliances that are
complement each other, especially the verticals, have a greater likelihood of creating a
sustainable competitive advantage. Horizontal complementary alliances, in
Occasions are difficult to maintain because they often occur between rivals.
The strategic alliances designed to respond to competition and reduce
uncertainties can also create competitive advantages, but these advantages to
they are more temporary than those developed through alliances
complementary strategies.
Of the four cooperation strategies, the one used to reduce competition.
it is the one with the least likelihood of creating a sustainable competitive advantage.
Companies that use these strategic business alliances to reduce the
competition must closely monitor to what extent they are facilitating the
creation of competitive advantages.

Corporate cooperation strategies

The company uses a corporate cooperation strategy to help it

diversify in terms of the products it offers, the markets it serves or
the two things. Alliances for diversification, synergistic alliances and the
franchises are the corporate cooperation strategies used with
more frequently.
Companies use alliances for diversification and synergies for
grow and diversify its operations through various means, and not through one
merger or acquisition. When a company wants to diversify into markets
where the host country government prevents mergers and acquisitions. The
alliances are a very convenient option. Strategic alliances
corporate deals are also attractive compared to mergers and,
particularly, with the acquisitions, because they require that they commit less
resources and allow greater flexibility in terms of activities
necessary to diversify the operations of the partners.

Strategic alliance for diversification

A strategic alliance for diversification is a corporate strategy for
cooperation that companies use to share part of their resources and
capabilities in order to diversify with new products or in other areas of
market. It should be noted that very diversified alliance networks can lead
that allied companies register poor performance. However, the
cooperative companies are also used to reduce diversification in
companies that are too diversified.

Synergistic strategic alliance

A synergistic strategic alliance is a corporate cooperation strategy.
that companies use to share part of their resources and capabilities with
the end of generating economies of scale. Synergistic alliances, just like the
complementary horizontal business strategic alliance, create synergies in
various functions or multiple businesses of the partner companies.

Franchising
Franchising is a corporate cooperation strategy that a company ...
uses as a contractual relationship through a franchise that describes and controls
the way you will share your resources and capabilities with your partners.
A franchise is a contract entered into by two independent companies from the
legal standpoint, through which the franchising company grants to the
franchised the right to sell its product or develop its activities in
a designated square, using its registered trademarks, during a
specific period.
The franchising strategy has particular appeal for industries.
fragmented, such as those in retail and commercial printing. In the
fragmented industries a significant number of small companies and
mediums compete as rivals, but no company or small group of
they have a dominant share, which allows a company to win
a large market share, consolidated independent companies by
means of contractual relationships.

Evaluation of corporate cooperation strategies

Each class of cooperation strategy entails costs. The strategies
cooperative corporations, compared to business ones, tend to have a
broader scope and be more complex, which makes them somewhat
most expensive point. The companies that formulate and use strategies of
Cooperation, especially corporate cooperation, must be aware of the costs.
This implies alliances and watching them very carefully.
Despite these costs, when companies formulate and use effectively
your corporate cooperation strategies can create competitive advantages and
value. The probability of the above occurring increases when the...
success experiences of alliances.

International cooperation strategy

Intrafrontier strategic alliances is an international strategy of

cooperation with which companies that have headquarters in different
countries combine part of their resources and capabilities to be able to create a
competitive advantage.
The increase in the use of cross-border strategic alliances is due to several
reasons. In general, multinational companies perform better than
those that are only national. Therefore, a company can form
cross-border strategic alliances to leverage core competencies that
they are the foundation of their national success to expand into international markets.
The limited opportunities for national growth and economic policies
from other governments are different reasons that lead companies to use the
intrafrontier alliances.
Companies also use cross-border alliances as support for their
transformation or to better utilize your advantage and take advantage of the opportunities that
arise in a rapidly changing global economy.

Network cooperation strategy

The network cooperation strategy consists of an agreement between several companies.

with the aim of forming multiple partnerships that will cooperate to achieve objectives
shared.
The network cooperation strategy is particularly effective when involved in
the companies that are grouped within a geographical area. The relationships
effective among the associates and the interactions between them when they share their
resources and capabilities increase the likelihood that the strategy of
network cooperation is successful, just like having a company works as
strategic center of production. The companies that are part of these
networks obtain information and knowledge from many sources. They can also
use these sets of heterogeneous knowledge to produce more and
best innovations.

Types of alliance networks

Having access to multiple collaborations increases the likelihood that they will
additional competitive advantages can be formed when the set is expanded
resources and capabilities that are shared. Greater development of new
capabilities, in turn, stimulate the development of product innovations,
the same ones that are fundamental for strategic competitiveness in the economy
global.
Therefore, dynamic alliance networks are primarily used for
stimulate the rapid innovations and products that create value and their subsequent
successful entry into the market, which highlights that its purpose often
it is the exploration of new ideas.
Small businesses also gain credibility faster when they participate.
in the relationships of these joint networks.

Competitive risks of cooperation strategies

It is worth noting, in a few words, that many cooperation strategies fail.

Failure is not desirable, but it can turn into a valuable experience for
Learn. Companies must carefully study the failure of a strategy.
cooperation in order to obtain information that they can use to
successfully formulate future cooperation strategies.
One of the risks of cooperation strategies is that one of the parties
he can act opportunistically. This form of behavior presents itself
when formal contracts do not prevent something from happening or when the alliance is
founded on a phase of perception of the partner's reliability.
Some cooperation strategies fail when it is discovered that one
the company has made false statements about the competencies it will bring to the
society. The risks of false statements regarding competencies is greater
common when the partner's contribution is based on some of its assets
intangibles.
Another risk is that a company does not fulfill the commitment to put on
disposition of the partners, the resources and the capabilities they are willing to contribute to the
cooperation strategy.
Another risk is that a company may make specific investments for the
alliance, while the other partner does not.
Management of cooperation strategies

As noted, cooperation strategies represent important

strategic alternatives for companies competing in the global economy.
Nevertheless, the analysis of these strategies also shows that they are very
complex and managing them well is quite a challenge.
The company that learns to manage cooperation strategies better than its
competitors could develop a competitive advantage in terms of this
activity.
The people in charge of managing the set of cooperation strategies of a
the company coordinates activities, organizes knowledge by categories
obtained from previous experiences and ensures that what the company knows
about how to formulate and effectively use strategies is in the hands of
the right people at the right time.
With the management's focus on minimizing costs, the company
celebrate formal contracts with their partners. These contracts provide for how
it will monitor the cooperation strategy and control the behavior of the
partners. The goal of this approach is to minimize the costs of the strategy of
cooperation and preventing a partner from displaying opportunistic behavior. The
the second approach to maximizing opportunities focuses on maximizing
the opportunities of society to create value. In this case, the partners are
ready to take advantage of unexpected opportunities to learn from the
others and explore the additional possibilities of the markets.
Companies can successfully use both approaches to manage the...
cooperation strategies. However, the costs of monitoring the strategy
cooperation is higher in the case of cost minimization, because
drafting detailed contracts and using many monitoring mechanisms is very
expensive, even when the approach aims to reduce costs of
alliance.