Strategic Partnership Agreement Pdf

One of the main reasons for the commitment to a strategic alliance is the facilitation of access. Entry into new industries is also a significant threat. The current rivalry in the sector can increase entry difficulties. For example, new players in the aviation industry are slowly arriving. The best strategy for companies to enter the sector is to partner with one of the airline`s historic brands. A strategic partnership with one of these brands will reduce potential risks, such as the early termination of operations. A smart alliance also minimizes the risk that current resources will be mismanaged. Another zust that must be taken into account when strategic alliances are formed is the possible misuse of resources. The partnership between two independent companies means that there is a pool of senior officials who wish to implement the rules. In this situation, where a considerable number of people want to lead, some may resort to mismanagement of resources. Another possible scenario that could lead to abuse of ownership is that both parties are not able to opt for a standard method to achieve the common goal. As a result, each party wants to provide resources to implement its favourite practices and ultimately waste more than following a failed plan.

One of the potential drawbacks of promoting new alliances is the misinterpretation of the benefits that each company can bring. One party can develop an exaggerated understanding of what the other party has to offer. Suppose Company A expects, for example, that Company B will provide more resources with more equipment, but Company B is not able to do so. The excessive expectation of Company A may be due to misunderstandings about the statement of Company B. A simple misunderstanding could lead to the decline of the partnership. One of a company`s main goals is to maximize profits at a lower cost. There are several methods, and one of them is to engage in a strategic alliance. In a Harvard Business Review study, the number of strategic cooperations between companies increases by a quarter each year. A successful partnership also contributes one-third of a company`s annual profit.