STRATEGIC MANAGEMENT Essay Example | Topics and Well Written Essays - 1250 words

STRATEGIC MANAGEMENT - Essay Example Infomedia also considers itself as an interest publishing organization. Their strategic alliance’s formation occurred in April, 2008. The two companies sought to provide the Small, Medium Enterprises (SMEs) with quality solutions directed towards the advancement of both domestic and global trade (Das 34). Introduction Managers in most organizations are adopting strategic alliance as a way of realizing their strategies instead of retaining the old strategic make and sell strategy initially used. By definition, a strategic alliance is a relationship formed because of the availability of mutual interests between groups of interdependent organizations. These relationships last for as long as they prove to be economically viable (Das 67). In the case of Alibaba and Infomedia, both companies realized the potential benefits of supplying the SMEs with quality solutions, which pave the way for further advancement in both the domestic and global trade sectors (Yoshino and Rangan 76). .. . Alibaba, a company, which has an established presence in e-commerce, stood to benefit from the alliance by realizing some of its expansion strategies. Alibaba’s choice to form an alliance with Infomedia, a respectable Indian based company guaranteed Alibaba a successful entry into the Indian market. On the other hand, Infomedia stood to benefit from the access into the global mainframe, a niche successfully occupied by Alibaba. Targeting the small and medium enterprises proved to be a successful strategy. This is because both Indian and Chinese business sectors comprise these businesses in large numbers. Therefore, both management teams were able to come up with strategic goals that would ensure an efficient and effective way of dealing with their competitive surroundings. The different areas analyzed in order to determine whether both companies fit included strategic, cultural, resource, and structural aspects. The realization that these companies proved to be compatible on a strategic, cultural, resources and structural level showed that two were a match and that they formed a perfect fit (Das 116). b) Type of strategic alliance Determining the strategic alliance suitable for both the organizations also proved to be an integral part for both organizations. Companies choose between horizontal and vertical types of strategic alliance. The horizontal type allows competing businesses to form an alliance that will allow each partner to gain access to various segments in the industry. Horizontal strategic alliances allow partners to learn from each other, reduce the risks, and improve efficiency. On the other hand, vertical strategic alliances involve the partnering of one or more suppliers or customers. They create extra value for the