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Home arrow Management arrow Strategic Management in the 21st Century. Corporate Strategy

GLOBAL PARTNERSHIPS OF THE FUTURE

In the future, not only will competition be more challenging but strategic partnerships will also likely be more indispensable and more perilous. Although the model in which proficient companies from developed countries partner with weaker firms from lesser-developed countries has in the past been employed with success, reliance on these partnerships is likely to be less advantageous in the future. Reasons for this include the increasing pace of technological advancement, the growing ease of knowledge transfer, and the problematic nature of intellectual property protection in developing countries. Moreover, as noted earlier, firms in developing economies typically employ VO strategies, and as a result, they often discount the value of both branding and design (strategic strengths of the MVD strategy) as company assets, and conceptualize the value of a product based only on its tangible inputs and characteristics.

Within the last few years, for example, Ford, General Motors, Toyota, Nissan, Honda, Suzuki, Mazda, Daihatsu, Mitsubishi, Fiat, Isuzu, and Volkswagen have all entered into joint ventures with Chinese firms to manufacture automobiles in China. Yet many of these partnerships are now either breaking down or are expected to do so shortly, as the Chinese partners are now moving into independent production and marketing.20 Not only are these Chinese firms competing with their former partners, they are doing so by selling highly derivative automobiles at lower prices.41 BYD's vehicles are, for example, considered to be fairly complete copies of Toyota products.42 Fiat has sued Great Wall Motor for copying its cars, and Mercedes-Benz has sued Shuanghuan. Similarly, General Motors has sued Chery for copying GM's Daewoo Matiz.43 Indeed, the name Chery is understood to be a close and deliberate derivation (both visually and in pronunciation) of Chevy, General Motor's trademarked nickname for its Chevrolet division. In pursuing these copycat strategies, none of the Chinese firms have admitted any wrongdoing, and the attitude projected by their executives seems to be one of bewilderment that emulation could be considered unreasonable.

These examples are not presented to suggest that the future holds few opportunities for firms to thrive and develop exchange relationships. Globalization and the new mix of competitive strategies it presents can provide fertile soil for firms willing to rethink past approaches to finding, exploiting, and defending markets. Partnerships will be increasingly indispensable for firms seeking to leverage their unique strategic advantages to capitalize on global opportunities. However, the nature of these partnerships is likely to evolve. In the past, joint ventures have often been formed to enable collaboration on distinct, grand projects that exceeded the individual capabilities or legal authority of the individual firms. In the future, partnerships are more likely to represent integrative efforts designed to create networks of interdependent organizations working toward a common goal. These "cooperative interorganizational relationships," as Ring and Van de Ven44 call them, are likely to embrace multiple goals and evolve through multiple structures over the course of the collaboration. Additionally, these partnerships are likely to reach beyond traditional conceptualizations of joint ventures into collaborative efforts between private sector firms, NGOs, and public sector organizations.45

An example of the new opportunities created in global markets can be seen in the mobile phone industry, in which cooperative interorganizational relationships are now ubiquitous. The spread of mobile phones offers at least three distinct opportunities for marketers, and the exploitation of each of these requires the creation and maintenance of interorganizational relationships. Moreover, these relationships may have to evolve rapidly to exploit opportunities that can emerge at short notice, and may result in new forms of business and/or interorganizational relationships. Although the discussion here relates to the mobile phone industry, it may become relevant to other sectors in the future. The examples merely illustrate broader collaborative opportunities that will be present in the future.

 
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