week 9

Question 1

What are the four types of networks described by Cravens & Piercy (1994)?

Answer 1

1. Virtual Network – Low volatility, collaborative (e.g., Star Alliance)

2.    Flexible Network – High volatility, collaborative (e.g., AWS + startups) 

3.    Value-Added Network – Low volatility, transactional (e.g., Toyota suppliers) 

4.    Hollow Network – High volatility, transactional (e.g., Nike outsourcing)

Question 2

What are Achrol’s four types of networks?

Answer 2

1. Internal Market – Within one organisation (e.g., P&G departments)

2.    Vertical Market – Across the supply chain (e.g., Apple + Foxconn) 

3.    Inter-Market (Concentric) – Across related industries (e.g., Google + Samsung) 

4.    Opportunity Networks – Temporary, goal-specific (e.g., SpaceX + NASA)

Question 3

What is the difference between a merger and an acquisition?

Answer 3

• Merger: Mutual agreement to combine ownership

*    Acquisition: One firm takes control of another

Question 4

What are six motives for mergers and acquisitions?

Answer 4

1. Speed of market entry

2.    Response to competition 

3.    Market consolidation 

4.    Financial strategy 

5.    Gaining capabilities 

6.    Meeting stakeholder expectations

Question 5

What are the challenges in making acquisitions work?

Answer 5

• Cultural integration issues

*    Failure to realise synergies 

*    Lack of middle management buy-in 

*    Poor strategic fit

Question 6

What is a strategic alliance?

Answer 6

A partnership where firms share resources and activities to pursue strategic goals without full ownership.

Question 7

What are key motives for forming strategic alliances?

Answer 7

• Gaining critical mass

*    Achieving co-specialisation 

*    Promoting organisational learning

Question 8

What are six types of strategic alliances and examples of each?

Answer 8

1. Joint Venture – Sony Ericsson

2.    Consortium – Airbus 

3.    Network – Starbucks supply chain 

4.    Franchising – McDonald’s 

5.    Licensing – Disney merchandise 

6.    Sub-contracting – Apple + Foxconn

Question 9

Why do strategic alliances often fail?

Answer 9

• Misaligned goals

*    Cultural mismatches 

*    Poor communication 

*    Ineffective governance 

*    A study found less than 50% of MNCs were satisfied with their alliances

Question 10

What are three ingredients of successful alliances?

Answer 10

1. Clear strategic purpose

2.    Defined expectations and benefits 

3.    Strong relationship management

Question 11

How can firms measure strategic alliance performance?

Answer 11

• Using the Balanced Scorecard (Kaplan & Norton, 1992)

*    Includes financial and non-financial metrics 

*    Helps align performance with strategic objectives