BACHELOR OF BUSINESS ADMINISTRATION

BUSINESS ADMINISTRATION

STRATEGIC MANAGEMENT

Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
What is NOT a reason Companies enter strategic alliances?
A
Strengthen competitive advantage
B
Hedge against uncertainty
C
Learn new capabilities
D
Enter old markets
Explanation: 

Detailed explanation-1: -Strategic alliances are formed to gain market share, try to push out other companies, pool resources for large capital projects, establish economies of scale, or gain access to complementary resources.

Detailed explanation-2: -Joint Venture is not an example of a strategic alliance. In a strategic alliance, the two companies remain separate entities. In a joint venture, a new entity is formed.

Detailed explanation-3: -Differing procedures and opinions between the parties The parties in the alliance may experience different levels of what is tolerated by production errors. One company may deliver its goods or service behind schedule, or do a bad job producing their goods or service which may lead to distrust among the two companies.

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