During the past decade, strategic partnering has become a more attractive option
because of the wide range of benefits, without the risk and burden of paying for
them. These benefits include:
- Expanded access to markets
- Advanced technology
- Quicker product development
- Broader geographic range
The goal is finding a partner in areas where one or the other company has limited
expertise. In a successful alliance, partners gain access to specific strengths --
such as sales, technology, finance, distribution, etc. -- that they don't possess
themselves. Another driving force behind alliance-building is the desire to control
the quality and performance of the entire production process -- from raw materials
to system design, from manufacturing to global distribution.
Sharing Benefits and Risks
The synergy generated by two cooperating organizations results in a sum greater
than their parts. A successful alliance preserves each business' distinct competitive
advantage and allows those advantages and core competencies to grow.
Benefits of partnering also include economies of scale, resulting in:
- Increased versatility
- Reduced costs through increased production
- Enhanced purchasing and financial arrangements
- Stronger negotiating position with suppliers, customers and/or regulatory
agencies
- Greater access to critical resources
- Opportunities for large-scale marketing efforts
READ MORE (Strategy - Pricing Strategies) >>
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