Ch07_09_combo_present_Cho_Final

G long lasting establishing standards gain market

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Unformatted text preview: armaceutical firms develop relationships with Biotech firms – Bristol-Myers Squibb and biotech firm ImClone Systems • IBM, Intel and Microsoft in desktop computing IBM, 1–41 External View: Reasons for Strategic Alliances Market Fast Cycle: CA is not shielded from imitation for long, CA is fleeting or temporary e.g. IT industry (Hulu.com) Reason • Speed up development of new goods or service • Speed up new market entry • Maintain market leadership • Form an industry technology standard • Share risky R&D expenses • Overcome uncertainty 1–42 Reasons for Strategic Alliances Market Reason Slow Cycle: • Gain access to a restricted market CA is shielded from • Establish a franchise in a new imitation for longer, market CA is relatively • Maintain market stability (e.g., long lasting establishing standards) • Gain market power e.g. Steel Industry (Nucor + U.S. Steel) 1–43 Reasons for Strategic Alliances (cont’d) Market Standard Cycle: CA is shielded from imitation for moderately long period, CA is short term e.g. Airline Industry (Star alliance) Reason • Gain access to complementary resources and capabilities • Gain market power (reduce industry overcapacity) • Establish economies...
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