Journal Art 3
Part 1
Strategic alliance
A strategic alliance gets defined as an alliance that is voluntary that two companies engage in, undertaking a project that is mutually beneficial without interfering with the independence of each of the organizations (Serrat, 2017). The agreement is not as complex or as binding as a venture that is joint in which they are required to pool their resources in creating a business entity that is separate. Strategic alliances formed by organizations entail activities like sharing and exchange, which entails co-development of services, products, processes, and procedures. According to Subramanian & Kah-Hin (2018), the aim of creating strategic alliances is to help organizations to learn from each other and acquire knowledge for use in innovation and growth in order to improve quality. Some of the other benefits of alliances include boosting development and research efforts, cost of research, boosting development and research efforts, The authors’ opinion of strategic alliances is that the get formed by organizations as a measure to acquire knowledge for innovation. These findings are important in establishing the learning benefits of getting into alliances, especially for small organizations that are still developing
Part 2
Joint venture
A joint venture gets defined as an arrangement in a business where two parties or more get into an agreement to pool their resources to accomplish a particular task, which could be a new project or any other business arrangement. In the article by Connelly et al., (2019), the authors talk about how shareholders influence the decision of an organization in getting into a joint venture. The article provides details of how different types of institutional investors impact the exploration choice that an organization engages in, in comparison to joint venture exploration. Joint ventures that are exploratory are characterized by outcomes that are uncertain, risk, and ex-post contracts, while JVs that are exploitative allow contracts that are ex-ante. The argument by the article is that investors that are dedicated and maintain holdings for a long time tend to reward success that is long term and is more tolerant of failure. Investors that frequently trade are less tolerant of failure and tend to punish underperformance. These transient investors are more likely to influence the decisions that get made by managers and are more selective of the ventures that an institution undertakes.
References
Connelly, B. L., Shi, W., Hoskisson, R. E., & Koka, B. R. (2019). Shareholder influence on joint venture exploration. Journal of Management, 45(8), 3178-3203.
Serrat, O. (2017). Learning in strategic alliances. Knowledge solutions (pp. 639-647). Springer, Singapore.
Subramanian, A. M., Bo, W., & Kah-Hin, C. (2018). The role of knowledge base homogeneity in learning from strategic alliances. Research Policy, 47(1), 158-168.