Question

A partnership involving two or more firms that is created to achieve a goal and has no joint ownership is a __________.

Answer 1

strategic alliance

Step-by-step explanation:

A strategic alliance is when two or more independent firms come together to carry out a venture that would benefit all parties while still retaining their independence. A strategic alliance can be short terms or long terms

Reasons for establishing a strategic alliance

1. To enter into a new market
2. to gain a competitive edge over other firms in the industry
3. to establish a new product

Example of companies that formed a strategic alliance include :

Hewlett-Packard and Disney

Starbucks and Barnes & Noble.

Advantages of strategic alliance

1. risks are shared among firms that form the alliance
2. helps to create economies of scale
3. the goals of the companies in the alliance can be reached faster

Disadvantages of strategic alliance

1. In a case where organisational culture differs, it may lead to a clash of culture
2. There is an increased risk of conflict among participating firms