Examine the Web sites of the following strategic alliances and determine which o

Question

Examine the Web sites of the following strategic alliances and determine which of the sources of value presented in Table 9.1 are present:

(a) Dow-Corning (an alliance between Dow Chemical and Corning)

(b) CFM (an alliance between General Electric and SNECMA)

(c) NCAA (an alliance among colleges and universities in the United States)

(d) Visa (an alliance among banks in the United States)

(e) The alliance among United, Delta, Singapore Airlines, AeroMexico, Alitalia, and Korean Air

Firgure 9.1

Strategic Alliances:

1) Nonequity Alliance - Cooperation between firms is managed directly through contracts, without cross-equity holdings or an independent firm being created.

2) Equity Alliance - Cooperative contracts are supplemented by equity investments by one partner in the other partner. Sometimes these investments are reciprocated.

3) Joint Venture - Cooperating firms form an independent firm in which they invest. Profits from this independent firm compensate partners for this investment.

Explanation / Answer

a) Dow-Corning (an alliance between Dow Chemical and Corning)

Joint Venture - Cooperating firms form an independent firm in which they invest. Profits from this independent firm compensate partners for this investment original. Originally established in 1943.

b)  CFM (an alliance between General Electric and SNECMA)

CFM International is a joint venture between GE Aviation, a division of General Electric of the United States and Snecma, a division of Safran of France. The joint venture was formed to build and support the CFM56 series of turbofan engine.

c) NCAA (an alliance among colleges and universities in the United States)

It is a non profit orgnisation among colleges and universities in the United States.

d) Visa (an alliance among banks in the United States)

Nonequity Alliance - Cooperation between firms is managed directly through contracts, without cross-equity holdings or an independent firm being created. Visa Inc is a company already made an Initial Public Offering (IPO)

e) The alliance among United, Delta, Singapore Airlines, AeroMexico, Alitalia, and Korean Air.

Nonequity Alliance - Cooperation between firms is managed directly through contracts, without cross-equity holdings or an independent firm being created

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