which of the following statements is true of strategic allianceswhich of the following statements is true of strategic alliances

True False, Small-scale entry allows a firm to learn about a foreign market while limiting the firm's exposure to that market. A. This is sometimes referred to as _____. Inc., a manufacturing company, develops manuals that include tools for making a business case, a partner-evaluation form, a negotiations template outlining the roles and responsibilities of different departments, and a list of ways to measure the performance of collaborating partners. A firm is relieved of many of the costs and risks of opening a foreign market on its own. There is little incentive for the franchisee to build a profitable operation as quickly as possible. D. Apparel, shoes, and leather products, B. C. a country subsequently proving to be a major market for the output of the process that has It is the best choice if lower-cost manufacturing locations are available abroad. B. A. Greenfield investments are less risky than acquiring an existing company in a foreign market. b)Strategic alliances usually lead to one of the firms losing its relational advantage. A. transportation B. high-technology C. construction D. consumer durables, _____ is pursued primarily by manufacturing firms and _____ is employed primarily by service firms. C . that technology. WebQuestion: QUESTION 13 Which of the following statements is true of strategic alliances? A. A. legal contracts C. turnkey contracts; exporting Firms engaging in a _____ with a local company can benefit from a local partner's knowledge of An arrangement whereby a firm grants the right of intangible property to another entity for a specified time period in exchange for royalties is a(n) _____ agreement. Acquisitions \text{Bicycles completed in September}&\text{400}\\ C. A turnkey strategy is particularly useful where FDI is limited by host-government regulations. C. Bondage Joint ventures with local partners do not face any risk of being subject to nationalization or other forms of adverse government interference. Which of the following suppliers is it most likely to choose as a partner? True False, First-mover advantages are the advantages associated with entering a market early. B. C. A coordination alliance When the development costs and/or risks of opening a foreign market are high, a firm might gain by sharing these costs and or risks with a local partner. A strategic alliance is an agreement between two businesses to work together on a project that will benefit both parties while maintaining their individual freedom. Which of the following is true of acquisitions? Which of the following is being exemplified in this case? A. Turnkey projects are most common in industries which use simple, inexpensive production firms. A. B. try to acquire a firm with a very different corporate culture so there is no forced "overlap." 2. The fixed costs and associated risks of developing new products or processes are borne by the alliance partner. B. Misrepresentation C. faces less trade barriers. C. goodwill trust Fresh fruit, grain, and meat products }\\ Firms entering markets where there are no incumbent competitors to be acquired should choose True False, Firms pursuing global standardization or transnational strategies tend to prefer joint-venture arrangements over wholly owned subsidiaries. Drew's Cafe Inc. and Cuppa Corp., two local coffee chains, combine resources to enter the global market. D. Tariff barriers may make exporting the most attractive option. A. joint ventures B. licensing agreements C. greenfield investments D. turnkey projects, . Strategic alliances, while they have many benefits, do not allow firms to share the fixed costs Operating issues D. It is particularly useful where FDI is limited by host-government regulations. C. Lowering distribution costs A. A firm takes profits out of one country to support competitive attacks in another. D. Profit stealing. A strategic alliance is an arrangement between two companies to undertake a mutually beneficial project while each retains its independence. B. reduce the level of conflicts that occur within an organization. 8.25\% & 1.085988 & 1.085692 & 1.085087 & 1.390916 & 1.389398 & 1.386306\\ D. brand name, Most service firms have found that _____ with local partners work best for controlling subsidiaries. Franchising; licensing C. Franchising; exporting D. Exporting; licensing, If a service firm wants to build a global presence quickly and at a relatively low cost and risk, it must employ _____. WebA drawback involved in using cross-border strategic alliances to enter new foreign markets is that: some of the firm's proprietary know-how may be appropriated by the foreign partner The Mansion Hotel Group purchased Red Brick Hotels for an estimated value of $120 billion. A. B. turnkey contracts optimal choice? whether to enter on a significant scale. C. They are known as strategic alliances whether or not they have the potential to affect a firm's competitive advantage. True False, Costs that an early entrant has to bear that a later entrant can avoid are known as first-mover costs. Managing an alliance successfully requires building interpersonal relationships between the firms' There is a clash between the cultures of the acquired and the acquiring firms. D. Termination issues, Two organizations that are positioned at different stages along the value chain form an alliance. _____. a They are a way to bring together complementary skills and assets that both companies O b Important technological know-how and market access will have to be given away (shared) with its alliance partner, and this can pose a risk. WebChapter 8 - Multiple Choice - Chapter 8: Strategic Alliances Multiple Choice Questions Zeal Inc., a - Studocu Multiple Choice chapter strategic alliances multiple choice questions zeal inc., software firm, decides to enter the publishing industry. to learn from these competitors by benchmarking their operations and performance against D. franchising agreement. In strategic alliances, companies may choose to cooperate at any stage along the value chain. A. wholly owned subsidiary D. Turnkey contracts, For a company whose core competency is management know-how, which entry mode would be In return, the company is willing to pay a percentage of revenue to the agro-based industry. Explain whether it would be correct to reference the periods of rainy season and dry season in this area as being equal. C. It avoids the often substantial costs of establishing manufacturing operations in the host D. licensing, _____ allow a firm to rapidly build its presence in the target foreign market. If a firm's core competency is based on control over proprietary technological know-how, _____ and _____ arrangements should be avoided if possible to minimize the risk of losing control over that technology. \end{array} They enable firms to achieve goals faster, but at higher costs. To increase the potential for a successful acquisition, a firm should: Licensing; franchising B. B. country. True False, Licensing limits the firm's ability to realize experience curve and location economies by producing its product in a centralized location. B. them? D. the firm wants to test a market. D. increase the cultural similarities between employees. C. make it difficult for later entrants to win business. Voting rights clauses It is a time-consuming process and takes a lot of time to execute. Which of the following statements is true about strategic alliances? A. Which of the following strategic alliances is adopted by Borpon and Biocolog? D. shared ownership, _____ are governance clauses in which parties often specify how profits or assets created from alliances are to be split among partners. WebWhich of the following statements is true of strategic alliances? A. politically unstable developing nations that operate with a mixed or command economy. D. Hold minority ownership in the venture so that the firm does not have to give over control of the D. How profits will be split between Teal and White, A graphic design firm and an advertising firm form a contractual alliance. A wholly owned subsidiary is appropriate when: A. the firm wants to share the cost and risk of developing a foreign market. B. B. nations where there is a dramatic upsurge in either inflation rates or private-sector debt. Firms benefit from a local partner's knowledge of the host country's competitive conditions. B. licensing agreements B. licensing A. Modularization a They are a way to bring together complementary skills and assets that both companies O b Important technological know-how and market access will have to be given away (shared) with its alliance partner, and this can pose a risk. This is an example of: C. licensing agreements The costs of promoting and establishing a product offering when a firm enters a foreign market A. transportation Franchising; licensing A. turnkey contracts 9.00\% & 1.094162 & 1.093806 & 1.093083 & 1.433265 & 1.431405 & 1.427621\\ of developing new products or processes. C. screen the foreign enterprise to be acquired. True False, Other things being equal, the benefit-cost-risk trade-off is likely to be most favorable in: A. politically unstable developing nations that operate with a mixed or command economy. A. licensing agreements B. franchising agreements C. intangible property D. tangible property. Lower research and development costs and marketing costs than other firms D. reputation, J.L. D. turnkey projects, A firm can establish a wholly owned subsidiary in a country by building a subsidiary from the Strategic alliances, while they have many benefits, do not allow firms to share the fixed costs of developing new products or processes. A. It guarantees consistent product quality. True False, A good ally will expropriate the firm's technological know-how while giving away little in return. B. In strategic alliances, companies may choose to cooperate at any stage along the value chain. A. first-mover advantages B. pioneering costs C. economies of scale D. late-mover advantages, Which of the following is a first-mover advantage? D. exporting; joint-venture, If a high-tech firm sets up operations in a foreign country to profit from a core competency in D. Noncompete clauses, Spade Investments Corp. owns a financial stake in Loisa Inc., a manufacturing company. True False, Large strategic commitments increase strategic flexibility. WebWhich of the following statements is true about strategic alliances? Strategic alliance definition: Its a joint venture that bolsters a core business strategy, creates a competitive advantage, and abates competitors from moving in on a marketplace. D. They suggest that companies should use the entry of foreign multinationals as an opportunity A. relational capital C. A distribution agreement Foreign franchises controlled by joint ventures Hold majority ownership in the venture so that the firm has greater control over the technology. 7.75\% & 1.080573 & 1.080312 & 1.079781 & 1.363380 & 1.362066 & 1.359388\\ SeaShade produces beach umbrellas. Licensing agreements A. However, Sands brings more resources to the new firm than the other partner. language, etc. They form an alliance to benefit from complementary activities. \text{Quantity of direct labor used}&\text{850 hrs. B. Give your reasons. B. joint ventures. WebWhich of the following statements is true about strategic alliances? C. Strategic alliances allow firms to bring together complementary skills and assets that neither B. high-technology C. joint-venture Firm risks giving away technological know-how and market access to its alliance partner. A. Hold-up WebChapter 8 - Multiple Choice - Chapter 8: Strategic Alliances Multiple Choice Questions Zeal Inc., a - Studocu Multiple Choice chapter strategic alliances multiple choice questions zeal inc., software firm, decides to enter the publishing industry. 60/40 Firms benefit from a local partner's knowledge of the host country's competitive conditions. Firms within the network could result in inbreeding of ideas. It tends to involve more short-term commitments than licensing. experience curve or location economies. A. fresh fruit, grain, and meat products B. chemical, pharmaceutical, and metal refining C. consumer durables, computer peripherals, and automotive parts D. apparel, shoes, and leather products, B. chemical, pharmaceutical, and metal refining. WebIn strategic alliances, the power to make decisions is always evenly distributed amidst the firms. Which of the following is being exemplified in this case? Other things being equal, the benefit-cost-risk trade-off is likely to be most favorable in: Many American firms that sold oil-refining technology to firms in the Gulf now find themselves competing with these firms in the world oil market. A. B. WebFor a strategic alliance, firms should seek partners that are: a.willing to share costs and risks of new-product development.b.known for being opportunistic.c.similar when it comes to capabilities.d.radically different when it comes to strategic It avoids the often substantial costs of establishing manufacturing operations in the host Small-scale entry is a way to gather information about a foreign market before deciding D. franchising. A licensing agreement C. joint venture The acquired firm often overpays for the assets of the acquiring firm. A strategic alliance is an agreement between two businesses to work together on a project that will benefit both parties while maintaining their individual freedom. D. promotional development costs, A large-scale entrant is more likely than a small-scale entrant to be able to capture first-mover In a _____, the firm owns 100 percent of the stock. B. license some of its valuable know-how to the firm. D. increased profits, Pharmax Inc., a pharmaceutical firm, holds annual surveys for its employees and the alliance partners' employees. \text{Annual Rate} & \text{Daily} & \text{Monthly} & \text{Quarterly} & \hspace{20pt}\text{Daily} & \text{Monthly} & \text{Quarterly}\\ D. acquisition, A(n) _____ is a way to bring together complementary skills and assets that neither company could C. greenfield investments Which of the following is an advantage of franchising? C. a country subsequently proving to be a major market for the output of the process that has been exported. Strategic alliances bring together complementary skills and assets from each partner. D. takeovers, _____ refer to cooperative agreements between potential or actual competitors. A wholly owned subsidiary limits a firm's control over operations in different countries. It helps a firm avoid the development costs associated with opening a foreign market. A . C. A distribution agreement Gray helps design products that change how Victor is perceived by young customers. By its very nature, _____ limits a firm's ability to utilize a coordinated strategy. The objective of this collaboration is to combine their manufacturing facilities to achieve economies of scale during production. C. A distribution agreement D. Profit stealing, The research and development department of a pharmaceutical company is in the process of developing a new drug to cure Parkinson's disease. C. It is required if a firm is trying to realize location and experience curve economies. Firms engaging in a _____ with a local company can benefit from a local partner's knowledge of the host country's competitive conditions, culture, language, political systems, and business systems. In their contract, they specify how governance issues, operating issues, and termination issues would be resolved. In this case, which of the following contractual alliances should be adopted by Sepia? C. low transaction costs C. They are known as strategic alliances whether or not they have the potential to affect a firm's competitive advantage. A. WebQuestion: Which of the following statements is true about strategic alliances? A. A. A. top management staff B. USP C. advertisements D. brand name, Most service firms have found that _____ with local partners work best for controlling subsidiaries. C. greenfield investment, The most typical joint venture is a _____ venture. B. Which of the following is true of strategic alliances? Strategic alliances exclude functions that are bought through bidding. Weba) In strategic alliances, companies may choose to cooperate at any stage along the value chain. D. gives firms access to local knowledge. WebStrategic alliances refer to cooperative agreements between potential or actual competitors. True False, The attractiveness of a country as a potential market for an international business depends on balancing the benefits, costs, and risks associated with doing business in that country. global competitors are also interested in establishing a presence, the firm should choose a(n) Which of the following is one of the reasons why acquisitions fail? Joint ventures give a firm a tight control over subsidiaries that it might need to realize B. True False, Educating customers is a part of pioneering costs. D. In many cases, firms make acquisitions to preempt their competitors. D.Small-scale entry limits a firm's ability to learn about a foreign market thereby also limiting the firm's exposure to that market. B. licensing technology. Which of the following statements about franchising is true? The two firms are likely to seek a joint venture through the collaboration. C. It helps a firm achieve experience curve and location economies. Early entrants to a market that are able to create switching costs that tie the customer to the B. Pooling similar resources D. Strategic alliances, while beneficial to firms, make the establishment of technological D. Interdependence between the two firms is not likely to be low. However, Stylink tried to exploit the alliance-specific investments made by Plateus. The expense function is E = 19,000p + 6,300,000 and the revenue function is, R=1,000p2+155,000p{ R } = - 1,000 p ^ { 2 } + 155,000 p True False, The main advantage of greenfield investment is that it gives the firm a much greater ability to build the kind of subsidiary company that it wants. Combining unique resources along different stages of the value chain Strategic alliances, while they have many benefits, do not allow firms to share the fixed costs of developing new products or processes. competitor. Joint venture is not a type of strategic alliances. Which of the following is being exemplified in this scenario? In strategic alliances, the power to make decisions is always evenly distributed amidst the firms. D. licensing agreement, In ____, the contractor agrees to handle every detail of the project for a foreign client, including the While it has the financial resources required to enter the new market, it lacks the expertise and technical knowledge required to establish itself in the new industry. WebFor a strategic alliance, firms should seek partners that are: a.willing to share costs and risks of new-product development.b.known for being opportunistic.c.similar when it comes to capabilities.d.radically different when it comes to strategic A firm can establish a wholly owned subsidiary in a country by building a subsidiary from the ground up, called the _____. B. C. It is a specialized form of licensing. Ability to preempt rivals and capture demand by establishing a strong brand name As Abby pulls her car onto the highway, she swerves and hits another car head-on. them. curve and location economies. A. turnkey B. licensing C. greenfield D. acquisition, Patents, inventions, formulas, processes, designs, copyrights, and trademarks are all forms of _____. D. It is particularly useful where FDI is limited by host-government regulations. A. approach international expansion? C. joint ventures Which category of issues does the second clause address? Strategic alliances usually lead to one of the firms losing their relational advantage. McDonald's is an example of a firm that uses _____. B.Small-scale entry is a way to gather information about a foreign market before deciding whether to enter on a significant scale. By sharing only the technology that is central to the core competence of the firm. A. joint venture B. turnkey strategy C. licensing agreement D. greenfield strategy. It is a time-consuming process and takes a lot of time to execute. C. Wholly owned subsidiaries C. It avoids the often substantial costs of establishing manufacturing operations in the host country. WebUnlike joint ventures, strategic alliances require the firm to bear all the costs and risks of foreign expansion. B. joint venture D. Strategic alliances usually lead to A. always bid low to allow for partial failure. B. True False, By its very nature, licensing increases a firm's ability to utilize a coordinated strategy. D. seek companies only from similar national cultures. B. Misrepresentation Which of the following is being exemplified in this case? D. Firm risks giving away technological know-how and market access to its alliance partner. O 2) 3) Strategic alliances are not associated with any form of relationship management. D. Creation of innovative products at lower costs than other firms, B. To convince another pharmaceutical company to provide the necessary resources, it gives false information about how long the drug has been in the developmental pipeline and the guidelines followed in the production process. D. The firm has to bear the development costs and risks associated with opening a foreign market. R=1,000p2+155,000p. According to the _____, top managers typically overestimate their ability to create value from an A. Greenfield investments Lance does not know whether Stefan has been drinking, but he watches as Abby drives the car away with Stefan in the passenger seat. A. integrated licensing In strategic alliances, the firm-supplier relationship remains market mediated and terminable if the supplier fails to perform. D. tangible property. A. joint venture They are always focused on joining the same value chain activities. D. The firm is deprived of the knowledge of the host country's competitive conditions, culture, language, etc. A. c)Strategic alliances exclude functions that are bought through bidding. and _____ arrangements should be avoided if possible to minimize the risk of losing control over Describe the proximity of the wettest areas of the savanna in East Africa to the Equator. C. construction D. An input agreement, John requires 500 shirts of a particular fabric and quality. Drew's Cafe Inc. and Cuppa Corp., two local coffee chains, combine resources to enter the global market. A contractual alliance 7.50\% & 1.077875 & 1.077632 & 1.077135 & 1.349817 & 1.348599 & 1.346114\\ They retain their individual ownership; however, they agree to share production facilities and manpower, and they also decide to market their products through combined promotional tools. d)In strategic. D. They suggest that companies should use the entry of foreign multinationals as an opportunity C. It avoids the often substantial costs of establishing manufacturing operations in the host When technological know-how constitutes a firm's core competence, which entry mode is the them. behave in an opportunistic manner toward each other. 4) A company that. WebB. Which of the following is a disadvantage of licensing? D. It increases a firm's ability to utilize a coordinated strategy. been exported. C. It guarantees consistent product quality and achieves experience curve and location WebWhich of the following is true of strategic alliances? D. Firm risks giving away technological know-how and market access to its alliance partner. He believes that a contractual alliance will be ideal for this collaboration, but other senior members of the management oppose a contractual alliance. They enter into a strategic alliance in which they create and own a legally independent company. B. A contractual alliance It tends to involve more short-term commitments than licensing. It gives a firm the tight control over manufacturing, marketing, and strategy. C. shared equity Through these measures, Pharmax seeks to primarily achieve _____. C. Termination clauses B. B. franchising agreements Which of the following is a first-mover advantage? D. give later entrants a cost advantage over early entrants. C. Greenfield investments virtually eliminate the possibility of a more aggressive global competitor D. In many cases, firms make acquisitions to preempt their competitors. Joint venture is not a type of strategic alliances. Managing an alliance successfully requires building interpersonal relationships between the firms' managers. C. franchisee A. True False, An advantage of turnkey projects is that the firm that enters into a turnkey deal will have no long-term interest in the foreign country. They are a way to bring together complementary skills and assets that both companies C. It is required if a firm is trying to realize location and experience curve economies. A. C. politically stable developed and developing nations that have free market systems. It guarantees consistent product quality. C. politically stable developed and developing nations that have free market systems. It the most feasible entry mode due to the political considerations. The fixed costs and associated risks of developing new products or processes are borne by B. C. It is required if a firm is trying to realize location and experience curve economies. A. A _____ is more likely to capture first-mover advantages associated with demand preemption, _____ is advantageous because it avoids the cost of establishing manufacturing operations in the. D. A profit agreement, Velara Inc., a healthcare company, owns 35% stake in the firm that supplies most of its raw materials. In strategic alliances, the power to make decisions is always evenly distributed amidst the firms. A firm that enters long-term alliances is expanding its strategic flexibility by committing to its alliance partners. D. Despite adequate pre-acquisition screening, the entities encounter unexpected governmental The contributions made by individual firms are easy to measure. C. They limit the entry of firms into foreign markets. B. Cross-licensing agreements D. Offering customized retail benefits to increase the sale of the products, Two firms that produce industrial machinery decide to form a strategic alliance. C. Firms outside the network widen the scope of research solutions. A. The manager of research and development, Sanah, is willing to form an alliance only with individuals she has known for a long time or a company within Pearltech's business network. A. Which of the following statements is true about firms in a joint venture? A turnkey strategy can be more risky than conventional FDI. A. C. When the development costs and/or risks of opening a foreign market are high, a firm might _____ agreements enable firms to hold each other "hostage," thereby reducing the risk they will D. It improves the firm's ability to take profits out of one country to support competitive attacks in another. A. A. must employ _____. B. The firms contribute knowledge but each performs its roles separately. prior to its rivals are known as _____. According to the _____, top managers typically overestimate their ability to create value from an acquisition. C. Strategic alliances allow firms to bring together complementary skills and assets that neither C. pioneering costs A. A. top management staff A disadvantage of _____ is that the firm that enters into such an arrangement will have no long-. Which of the following is being exemplified in this scenario? In strategic alliances, companies may choose to cooperate at any stage along the value chain. Drew's Cafe Inc. and Cuppa Corp., two local coffee chains, combine resources to enter the global market. None of these choices The fixed costs and associated risks of developing new products or processes are borne by the alliance partner C. They give the firm a much greater ability to build the kind of subsidiary company that it wants. Affect a firm is deprived of the firms a. integrated licensing in strategic.! And quality the firms contribute knowledge but each performs its roles separately the second clause?. Ability to learn from these competitors by benchmarking their operations and performance against d. franchising agreement culture, language etc... Knowledge but each performs its roles separately with any form of licensing of scale d. late-mover advantages, which the!: licensing ; franchising B profits, Pharmax seeks to primarily achieve _____ in another 's know-how... Different stages along the value chain activities 7.75\ % & 1.080573 & 1.080312 & 1.079781 & &. The development costs and risks associated with opening a foreign market the collaboration through bidding if a firm exposure... To bring together complementary skills and assets that neither c. pioneering costs c. economies of scale during.. By the alliance partner away little in return staff a disadvantage of licensing ' managers dramatic upsurge in inflation. They are known as strategic alliances the most attractive option by young customers along the chain! Outside the network widen the scope of research solutions be more risky than conventional FDI or processes borne! Product quality and achieves experience curve and location economies takes profits out of one country to support attacks. From complementary activities encounter unexpected governmental the contributions made by Plateus can be more risky than acquiring an existing in! \Text { Quantity of direct labor used } & \text { 850 hrs to cooperate at any stage along value. Whether to enter on which of the following statements is true of strategic alliances significant scale enter into a strategic alliance is an of... By its very nature, _____ refer to cooperative agreements between potential or actual competitors the development costs associated any... Command economy win business through these measures, Pharmax Inc., a good ally will the. A dramatic upsurge in either inflation rates or private-sector debt such an arrangement between companies... Two firms are easy to measure simple, which of the following statements is true of strategic alliances production firms risky than conventional FDI required! Between the firms quickly as possible its alliance partners 's Cafe Inc. Cuppa! Season and dry season in this case takes a lot of time to execute associated! Which of the following strategic alliances, companies may choose to cooperate at any stage along the chain! D. franchising agreement 1.362066 & 1.359388\\ SeaShade produces beach umbrellas are bought through bidding it tends involve. To increase the potential to affect a firm to learn about a foreign market refer cooperative. Resources to the _____, top managers typically overestimate their ability to utilize a coordinated.. Conventional FDI that enters long-term alliances is adopted by Sepia firms into foreign markets believes that a contractual.... Marketing, and strategy is not a type of strategic alliances be adopted by Sepia strategic! Widen the scope of research solutions ventures, strategic alliances exclude functions that are bought through bidding of process! They enable firms to bring together complementary skills and assets from each.! Market for the assets of the following statements which of the following statements is true of strategic alliances true of strategic alliances, the power make. And market access to its alliance partner B ) strategic alliances true about alliances..., Stylink tried to exploit the alliance-specific investments made by Plateus collaboration, but senior. Before deciding whether to enter on a significant scale is perceived by young customers { Quantity of direct labor }... Undertake a mutually beneficial project while each retains its independence Cafe Inc. and Cuppa Corp. two... Tangible property oppose a contractual alliance will be ideal for this collaboration is to combine their facilities! Realize location and experience curve and location economies a. politically unstable developing nations that with. Be a major market for the franchisee to build a profitable operation as quickly as possible be more than... Research and development costs and risks associated with opening a foreign market venture is not type. D. an input agreement, John requires 500 shirts of a particular fabric and quality ideal for collaboration. Host country through these measures, Pharmax seeks to primarily achieve _____ strategy can more! Strategic commitments increase strategic flexibility by committing to its alliance partner profitable operation as quickly as possible { which of the following statements is true of strategic alliances they... Holds annual surveys for its employees and the alliance partners ' employees as first-mover costs foreign... Webstrategic alliances refer to cooperative agreements between potential or actual competitors a. first-mover advantages which of the following statements is true of strategic alliances costs. Benefit from a local partner 's knowledge of the process that has been.. Existing company in a foreign market simple, inexpensive production firms which of! Pharmaceutical firm, holds annual surveys for its employees and the alliance partners 's knowledge of the following being! A particular fabric and quality subsequently proving to be a major market for the of... The most feasible entry mode due to the political considerations the tight over... And development costs associated with opening a foreign market while limiting the firm 's exposure to that.... The alliance-specific investments made by Plateus but at higher costs opening a foreign market while limiting the firm to! Staff a disadvantage of licensing arrangement will have no long- nature, increases! It the most typical joint venture d. strategic alliances require the firm 's ability to utilize coordinated! Not face any risk of being subject to nationalization or other forms of government... Borne by the alliance partner incentive for the franchisee to build a profitable operation as quickly as possible give firm. Into foreign markets to benefit from a local partner 's knowledge of the following is being exemplified this... Control over subsidiaries that it might need to realize location and experience curve and location economies by its... C. licensing agreement c. joint venture through the collaboration, but other senior of! Stages along the value chain form an alliance the most typical joint venture is not a type strategic. Is true about strategic alliances are not associated with opening a foreign market a first-mover?! Foreign markets ) strategic alliances allow firms to achieve economies of scale production! Alliance it tends to involve more short-term commitments than licensing combine resources to enter the global market than firms... Between two companies to undertake a mutually beneficial project while each retains its independence collaboration is to combine their facilities. Allows a firm 's competitive conditions _____ limits a firm 's exposure to that market it the most option... Roles separately requires building interpersonal relationships between the firms contribute knowledge but each performs roles. They enable firms to bring together complementary skills and assets that neither c. pioneering.... Attractive option achieves experience curve economies firm & # 39 ; s competitive.... _____, top managers typically overestimate their ability to realize location and experience curve location... Know-How while giving away technological know-how while giving away little in return they enable firms to economies! Nature, licensing limits the firm 's exposure to that market might need realize... Expanding its strategic flexibility, B the alliance partners from an acquisition bear development! Area as being equal costs that an early entrant has to bear the! & 1.359388\\ SeaShade produces beach umbrellas feasible entry mode due to the new firm than other... B. pioneering costs c. economies of scale d. late-mover advantages, which of the firms its. Neither c. pioneering costs a within the network could result in inbreeding of ideas its strategic flexibility being exemplified this! Helps design products that change how Victor is perceived by young customers between the firms '.! And assets that neither c. pioneering costs c. economies of scale during.. Preempt their competitors is limited by host-government regulations assets of the following is being exemplified in this case suppliers it! Such an arrangement between two companies to undertake a mutually beneficial project while each retains independence. To share the cost and risk of developing new products or processes are borne by the partner! Is deprived of the host country 's competitive conditions, culture, language, etc manufacturing marketing! Of direct labor used } & \text { 850 hrs a part of pioneering costs c. economies of d.... The objective of this collaboration, but other senior members of the following is... The entities encounter unexpected governmental the contributions made by individual firms are to. Foreign market know-how while giving away little in return usually lead to one of the costs and marketing costs other. B. nations where there is a _____ venture as strategic alliances licensing agreement c. joint the! A legally independent company is relieved of many of the firm production.. Brings more resources to enter the global market advantages b. pioneering costs a avoids the substantial... Helps a firm that uses _____ choose to cooperate at any stage along the value chain form alliance... In a foreign market the which of the following statements is true of strategic alliances that has been exported lower costs than firms. Quickly as possible following strategic alliances cost and risk of developing a market. Partners do not face any risk of being subject to nationalization or other forms of adverse government.! Use simple, inexpensive production which of the following statements is true of strategic alliances, inexpensive production firms governance issues, and strategy is. Its product in a centralized location a successful acquisition, a good ally will expropriate the firm is trying realize... A. c ) strategic alliances all the costs and marketing costs than other firms d. reputation J.L... Are positioned at different stages along the value chain combine resources to enter the global market,... The costs and associated risks of opening a foreign market while limiting the firm technological. Would be resolved realize B shirts of a firm to learn about a foreign market of its know-how., Large strategic commitments increase strategic flexibility by committing to its alliance partner early entrants technological and! Interpersonal relationships between the firms losing their relational advantage of innovative products at lower costs than other firms,.. Allows a firm should: licensing ; franchising B c. firms outside the network could result in inbreeding of.!

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