Alliances , M&A etc

What is inter-firm cooperation (IFC)?

Partnerships between independent firms to gain competitive advantage.

What are the main forms of inter-firm cooperation?

• Transactional relationships

• Strategic alliances

• Mergers and acquisitions

What is a strategic alliance?

A formal partnership between firms that share goals and resources while staying legally independent.

What are the three types of alliances?

1. Contractual / Non-equity alliances

2. Equity alliances

3. Joint ventures (JVs)

When do alliances make strategic sense?

• Entering new or difficult markets

• High uncertainty

• Need to share costs and risks

• Gaining access to local knowledge or regulation

What are four types of alliance value?

• Symbiotic relationships

• Knowledge sharing

• Outsourcing

• Risk sharing / investment management

What is the goal of the strategic assessment step in alliance formation?

To evaluate long-term goals, market conditions, internal capacity, and strategic fit of an alliance.

Why is organisational buy-in important in alliance planning? (when key people in a company understand, support, and commit to a plan or partnership)

Organisational buy-in is important because it ensures alignment, support, and cooperation key for a successful and lasting alliance.

What is due diligence in partner engagement?

A thorough evaluation of cultural, strategic, legal, and financial compatibility with a potential partner.

Why is the contract crucial in the partnership execution stage?

It defines scope, ownership, decision rights, responsibilities, and exit rules to avoid conflicts.

What should governance and evaluation include in an alliance?

• Decision-making structure

• Performance review process

• Periodic reassessment of strategic alignment

When should you exit an alliance?

When the partnership no longer meets goals, becomes inefficient, or strategic needs change.

How does a joint venture differ from a contractual alliance?

A joint venture forms a new legal entity with shared control, while a contractual alliance doesn’t involve ownership.

Why might an alliance fail?

Cultural or strategic misalignment
Lack of trust
Poor governance
Incompatible goals or values
Redundancy of resources
Better value from M&A

What are the main steps in creating a strategic alliance?

1. Set clear goals

2. Identify the right partner

3. Assess compatibility

4. Develop a business case

5. Negotiate terms

6. Formalise the agreement

7. Gain internal buy-in

8. Implement the alliance

9. Monitor progress

10. Review and adjust as needed

What should governance and evaluation include in an alliance?

• Decision-making structure

• Performance review process

• Periodic reassessment of strategic alignment

What is the first step in creating a strategic alliance?What is the purpose of the strategic assessment?

• Strategic assessment.

• To evaluate your own long-term goals, market risks/opportunities, and internal capacity.

What questions should be asked during strategic assessment?

What are our strategic goals?
Do we need a partner to succeed?
Should we build, buy, or ally?

What does partnership planning involve?

Gaining organisational buy-in, defining alliance structure, and creating a realistic implementation plan.

What are key criteria when selecting a partner?

Cultural compatibility
Strategic fit
Integrity
Resources
Operational strengths

What happens in the partner engagement phase?

You assess compatibility, perform due diligence, and create a joint business plan.

What is a joint business plan, and what should it include?

A shared document outlining the alliance’s goals, services, target market, resources, and success metrics.

What is the purpose of a partnership agreement or contract?

To define:
Scope of work
Asset ownership
Decision-making rights
Resource commitments
Exit and conflict resolution terms

What is alliance governance?

The system used to make decisions, manage performance, and resolve disputes.

What does performance evaluation involve?

Tracking progress using KPIs, reviewing strategy alignment, and making adjustments when needed.

What should happen if the external market changes significantly?

The alliance should be reviewed and possibly realigned or dissolved if it no longer fits.

Why is an exit strategy important from the beginning?

To prevent confusion or legal issues when the alliance ends.

What must be decided in the exit plan?

Who keeps what assets
What responsibilities continue
How to value the partnership upon exit