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Strategic Relationship (Chapter 7) Intermediate
Suppliers customer
An important transformation of business has
taken place in industry after industry.. Joint Strategic
Competitor
First, the age of mass production is over and vantures Relationship
customer demand unique value, so value is
shifting from product to solution and Strategic
experiences, and consequently relationships are Internal
alliances partners
taking over as the central element of exchange. External
Second, no single business is likely to be big partner
enough to cope with complex and diverse
customer demand.
The rationale for inter-organizational Relationships
This underlines the importance of alliances and
networks to deliver customer value At one time companies mainly established relationships with other
constellations of suppliers that can be configured organizations to achieve tactical objectives, such as selling in smaller
in different ways to meet different customer overseas markets.
need.
However, the modern reality is that strategic relationships among
organizations relate to the key elements of overall competitive strength
technology, costs, and marketing. Unlike tactical relationships, the
IBM has been collaborative projects business : Top effectiveness of these strategic agreements among companies can affect
US science and engineering universities are funded
their long-term performance and even survival.
to create a new academic discipline called Service
Science and engineering, a partnership with Sony The various drivers of relationships fall into four broad categories : 1.
and Toshiba produced a new processor that is in opportunities to enhance value by combining the competencies of two or
Sonys Play-station and Toshibas TVs, and will be more organizations, 2. environmental complexity, 3. competitive strategy,
the foundation for IBMs next generation of computers and 4. skills and resource gaps.
; computer code is given to external developer; joint
with Linux and independent research establishments
throughout the world
Opportunities to Enhance Value nization compete primarily through its relationships with other
organizations to deliver value to end-user. This strategy relies on
The opportunity present in many markets today is that the ability to manage an array of strategic relationships with
organizations can couple their competencies to offer superior outsourcers, suppliers, and alliances.
customer value. Even when partnering is not required, a
relationship strategy may result in a much more attractive value Skill and Resource Gaps
offering. The computer industry has led in advancing the use of
modularity : chip designers, computer manufacturers, component The skills and resource requirements of technologies in many
specialists, and software firm are able to make unique industries often surpass the capabilities of a single organization.
contributions to product design, manufacture, and use by working The sharing of complementary technologies and risks are
within the framework of an integrated architecture, which important drivers for strategic partnerships.
indicates how the modules fit together and the functions each will
perform. Technology Constraints