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1、Formulating Corporate-Level StrategyHCAD53901Strategies2Distinguishing Corporations from Strategic Business Units (SBUs)Multi-SBUCorporations:lSoleseparatelegalentitylAuthorizedtoexecutecontractslAbletoborrowmoneyandsellequitylProducesnogoodsorserviceslQuitesmallstafflPrimaryfunctionistoassembleandm
2、anageaportfolioofSBUs3Distinguishing Corporations from Strategic Business Units (SBUs)StrategicBusinessUnits:lNoseparatelegalexistencelNoseparateabilitytocontractorraisecapitallProducegoodsandserviceslCompeteinoneormoremarketslRelativeautonomytomanageoperationsandstrategy4Value-Adding Functions of t
3、he Corporate CenterlManagethePortfolioofSBUslRaiseFinancialCapitalforAllocationtoSBUslAllocateResourcesandServicestoSBUslFacilitateSynergiesAmongSBUslChooseParentingStyleforSBUInteractionslParticipateinSBUStrategicPlanningProcesslOverseeandMonitorSBUPerformancelManageCorporateRelationsWithStakeholde
4、rs5Corporate Management of an SBU Portfolio (I)lInpursuitofacorporatevisionlAcquires,mergeswith,ordevelopsinternallynewSBUslDivestsexisting,unwantedSBUslSetperformancegoalsforSBUmanagementlProvideinputtoSBUstrategicdecisionslCountuponSBUstoperformuniquestrategicfunctions6Corporate Management of an S
5、BU Portfolio (II)lBalancebetweencentralcorporatedirectionandindividualSBUautonomylControlvsspontaneitylHiregoodSBUmanagers,givethemgeneralguidelines,andletthemlooseorlGivedetaileddirections,watchclosely,andintervenefrequently7Model Portfolio Management Process1.ChoosestrategicthrustofthecorporationG
6、rowthStabilityRetrenchment2.Choosegeographicareas,markets,andproductsorservicestoofferinthem3.DecidehowmanySBUsintheportfolioandwhichbusinessestheywillbe8Texas Health ResourceslTexasHealthResources(THR)isoneofthelargestfaith-based,nonprofithealthcaredeliverysystemsintheUnitedStatesandthelargestinNor
7、thTexasintermsofpatientsserved.Thesystemsprimaryserviceareaconsistsof16countiesinnorthcentralTexas,hometomorethan6.2millionpeople.THRwasformedin1997withtheassetsofFortWorth-basedHarrisMethodistHealthSystemandDallas-basedPresbyterianHealthcareResources.Laterthatyear,ArlingtonMemorialHospitaljoinedthe
8、THRsystem.THRhas12acute-carehospitalsandonelong-termcarehospitalthattotal3,100licensedhospitalbeds,employsmorethan18,000people,andcountsmorethan3,600physicianswithactivestaffprivilegesatitshospitals.THRisalsoacorporatememberorpartnerinsixadditionalhospitalsandsurgerycenters.910Adaptive StrategiesCor
9、porate-Level Strategic Options:Growth Expand the PortfoliolMostcommoncorporate-levelstrategydirectionlCriticaltomaintainingshareinagrowingmarketlInpursuitofeconomiesofscaleandscopelIncreaseinexperienceandlearninglTopexecutiveegostobesatisfied1112Expansion Adaptive Strategy:Orientation toward growthl
10、Expand, cut back, status quo?lConcentrate within current industry, diversify into other industries?lGrowth and expansion through internal development or acquisitions, mergers, or strategic alliances?Adaptive StrategiesGrowth By ConcentrationlAllbusinessesstartherelDedicateallresourcesandcompetencies
11、tooneorafewproductsorserviceslAchievedinoneofthreeways:SellmoreofcurrentproductsincurrentmarketsSellcurrentproductsinnewmarketsSellnewproductsincurrentmarketslTosellnewproductsinnewmarketsisdiversification1314Basic Growth Strategies:ConcentrationCurrent product line in one industryMarket Development
12、Product DevelopmentPenetrationDiversificationInto other product lines in other industriesAdaptive StrategiesConcentrationonaSingleBusinessSEARSCoca-ColaMcDonaldsSouthwest Airlines15ConcentrationonaSingleBusinesslAdvantagesOperationalfocusonasinglefamiliarindustryormarket.Currentresourcesandcapabilit
13、iesaddvalue.Growingwiththemarketbringscompetitiveadvantage.lDisadvantagesNodiversificationofmarketrisks.Verticalintegrationmayberequiredtocreatevalueandestablishcompetitiveadvantage.Opportunitiestocreatevalueandmakeaprofitmaybemissed.16Concentration No Longer Sufficient to Maintain GrowthlUnlikelyto
14、captureagreatershareofcurrentmarketlCurrentmarketisstagnating,maturing,shrinking,orotherwiselackinggrowthpotentiallExcesscashonhandneedstobeinvestedproductivelylManagementhasgreaterambitionsforfurtherstrategicachievement17DiversificationlRelateddiversificationEntryintonewbusinessactivitybasedonshare
15、dcommonalitiesinthecomponentsofthevaluechainsofthefirms.lUnrelateddiversificationEntryintoanewbusinessareathathasnoobviousrelationshipwithanyareaoftheexistingbusiness.18Growth By Related DiversificationlMovebeyondexistingmarketsandproductslEmployexistingresourcesandcompetencieslNewbusinessesareclose
16、lyconnected(“related”)toexistingbusinesseslDirectionsofrelateddiversificationVerticalforwardintegration(towardcustomers)Verticalbackwardintegration(towardsuppliers)Horizontalexpansion19Forms of RelatednesslProductsorserviceslMarketslProcesses,systems,orotheroperatingfeatureslManufacturingfacilities,
17、distributionchannels,marketingmedia,orsupportserviceslBrandimage,corporatereputation,creativityorinnovationskills,orgeneralmanagerialexpertise20Vertical IntegrationlForwardorbackwardintheindustryvaluechainlMoving“upstream”towardsuppliersHospitalacquiringaphysiciangrouppracticelMoving“downstream”towa
18、rdcustomersHospitalacquiringalong-termcarefacilitylExamples:physician-hospitalorganizations(failed),integrateddeliverysystems(succeeded)21Stages in the Raw-Material-to-Consumer Value ChainUpstreamDownstream22StagesintheRaw-Material-to-ConsumerValueChaininthePersonalComputerIndustryEnd userDistributi
19、onAssemblyIntermediatemanufacturerRaw materialsExamples:Dow ChemicalUnion CarbideKyoceraExamples:IntelSeagateMicronExamples:AppleHpDellExamples:Best BuyOffice Max23Vertical Integration24Decision Steps in Vertical IntegrationlAdequateresourcesandcompetenciestobringthenewbusinessoperationsin-houselCho
20、oseformofintegrationfullownership,partialownership,jointventure,orlong-termcontractlConsiderimpactonotherstakeholderslPayattentiontoshareofindustryvaluechainbeingbroughtin-house25Good Reasons for Vertical IntegrationlReducecostsbyeliminatingredundancythroughoutthevaluechainlBettercoordinationatinter
21、facebetweenvaluechaincomponentslProfit-takingatseverallevelsinthechainiseliminatedlGreateroverallcontrolofinputs(resources)andoutputs(distributionchannels)lWidernetworkofsourcesofcompetitiveintelligencelOpportunitytoreengineerthevaluechain26Vertical Integration Problems (I)lDoesthevaluechainfunction
22、aswellafterintegrationasitdidbefore?lExcessivecostsmaybeincurredinmanagingthenewbusinessesandtheirinteractionslInabilitytousefullcapacityofacquiredbusinessessomustselltocompetitors?lMustthebusinessdealexclusivelywithitsnewintegrationpartners?27Vertical Integration Problems (II)lCommitmenttoentirecha
23、inreducesstrategicflexibilitylCommitmentmaytiebusinesstoinefficientprocesses,poorlymanagedunits,andobsoletetechnologieslInabilitytocoordinateaddedunitsmayincreasecostsandlimitopportunitiestocreatevalueforcustomers28Horizontal ExpansionlMovingsidewaysinthevaluechain,acquiringsimilarbusinessesindiffer
24、entgeographicareaslAcquisitiontargetmaybeacompetitorlMaycreateantitrustenforcementconcernslExamples:multistatehospitalnetworks,nursinghomechains,nationalhealthplansystems29Best Circumstances for Horizontal ExpansionlCurrentmarketisgrowing,requiringadditionalcapacitytomeetdemandlTargetacquisitiondoin
25、gpoorlylacksresourcesorcompetenciespossessedbytheacquirerlExpandedsizeenableseconomiesofscaleleadingtocompetitiveadvantagelOpportunitytocreatedominantmarketpositionbyacquiringacompetitor3031Basic Diversification Strategies:Concentric (Related) DiversificationConglomerate (Unrelated) DiversificationD
26、iversificationIncentives to DiversifyInternalIncentives:lPoorperformancemayleadsomefirmstodiversifyanattempttoachievebetterreturnslFirmsmaydiversifytobalanceuncertainfuturecashflowslFirmsmaydiversifyintodifferentbusinessesinordertoreducerisk32Resources and DiversificationlBesidesstrongincentives,fir
27、msaremorelikelytodiversifyiftheyhavetheresourcestodosolValuecreationisdeterminedmorebyappropriateuseofresourcesthanincentivestodiversify33Managerial Motives to DiversifyManagershavemotivestodiversifydiversificationincreasessize;sizeisassociatedwithexecutivecompensationdiversificationreducesemploymen
28、triskeffectivegovernancemechanismsmayrestrictsuchmotives3435Concentric DiversificationGrowth into related industrySearch for synergiesRelated DiversificationRelated Diversification3MHewlett PackardMarriott36Related Diversification37Advantages of Related Diversification (I)lSynergiesamongexistinganda
29、cquiredbusinesseslLoweroverallcorporateriskbalancinghighandlow-riskSBUslGreaterbargainingpowervis-viscompetitors,suppliersandcustomers38Advantages of Related Diversification (II)lCross-subsidizationamongbusinessesatdifferentlifecyclestageslGeneralincreaseinrevenuesandprofitsfromacquiredbusinesseslOp
30、portunitytoacquirenewknowledge,competencies,andtechnologieslEnhancestatus,power,andcompensationoftopexecutives39Forms of Inter-SBU Synergy (I)lSharesolutionstoproblemsandideasforimprovingoperationalefficiencylUseslackcapacitytoachieveeconomiesofscalelEarnvolumediscountsandgreaterbargainingpowerwiths
31、upplierslIntegrationofcomputersystemsandcapabilities40Forms of Inter-SBU Synergy (II)lBysharingR&Dfacilities,reduceinnovationcostsandspreadresearchriskslSharedistributionchannelslLeveragetheuseofinfluentialbrandnamesandimageslWideopportunitiesforknowledgetransfer4142Unrelated (Conglomerate) Diversif
32、icationGrowth into unrelated industryConcern with financial considerationsAdaptive StrategiesGrowth By Unrelated DiversificationlFewsimilaritiesorcommonalitiesamongbusinessesintheportfoliolOperateindifferentindustries/markets,servedifferentcustomers,facedifferentcompetitorslCorporationcomposedofunre
33、latedbusinessesmaybecalleda“conglomerate”lWhatvalueisaddedbybringingunrelatedbusinessestogetherintoonecorporation?43Unrelated DiversificationTycoAmer Group ITT44Adaptive Strategies45Relationship Between Diversification and PerformancePerformancePerformanceLevel of DiversificationLevel of Diversifica
34、tionDominantBusinessUnrelatedBusinessRelatedConstrained46Bureaucratic Costs and the Limits of DiversificationlNumberofbusinessesInformationoverloadcanleadtopoorresourceallocationdecisionsandcreateinefficiencies.lCoordinationamongbusinessesAsthescopeofdiversificationwidens,controlandbureaucraticcosts
35、increase.Resourcesharingandpoolingarrangementsthatcreatevaluealsocausecoordinationproblems.lLimitsofdiversificationTheextentofdiversificationmustbebalancedwithitsbureaucraticcosts.47Tools for Implementing Growth StrategieslInternaldevelopmentlInternalnewventurecreationlInvestmentsinnewventureslAcqui
36、sitionlMergerlJointventure,strategicallianceorpartnership48AcquisitionsAcquisitionsReasons for Making AcquisitionsIncreaseIncreasemarket powermarket powerOvercomeOvercomeentry barriersentry barriersCost of newCost of newproduct developmentproduct developmentIncrease speedIncrease speedto marketto ma
37、rketIncreaseIncreasediversificationdiversificationReshape firmsReshape firmscompetitive scopecompetitive scopeLower risk comparedLower risk comparedto developing newto developing newproductsproductsLearn and developLearn and developnew capabilitiesnew capabilities49Diversification and Corporate Perf
38、ormance: A Disappointing HistorySources: Lipin, S. & Deogun, N. 2000. Big merges of the 90s prove disappointing to shareholders. Wall Street Journal, October 30: C1; A study by Dr. G. William Schwert, University of Rochester, cited in Pare, T. P. 1994. The new merger boom. Fortune, November 28:96; a
39、nd Porter, M.E. 1987. From competitive advantage to corporate strategy. Harvard Business Review, 65(3):43.lAstudyconductedbyBusiness WeekandMercerManagementConsulting,Inc.,analyzed150acquisitionsthattookplacebetweenJuly2000andJuly2005.Basedontotalstockreturnsfromthreemonthsbefore,anduptothreeyearsaf
40、ter,theannouncement:l30percentsubstantiallyerodedshareholderreturns.l20percenterodedsomereturns.l33percentcreatedonlymarginalreturns.l17percentcreatedsubstantialreturns.lAstudybySalomonSmithBarneyofU.S.companiesacquiredsince1997indealsfor$15billionormore,thestocksoftheacquiringfirmshave,onaverage,un
41、der-performedtheS&Pstockindexby14percentagepointsandunder-performedtheirpeergroupbyfourpercentagepointsafterthedealswereannounced.50AcquisitionsAcquisitionsProblems With AcquisitionsIntegrationIntegrationdifficultiesdifficultiesInadequateInadequateevaluation of targetevaluation of targetLarge orLarg
42、e orextraordinary debtextraordinary debtInability toInability toachieve synergyachieve synergyToo muchToo muchdiversificationdiversificationManagers overlyManagers overlyfocused on acquisitionsfocused on acquisitionsResulting firmResulting firmis too largeis too large51Corporate-Level Strategic Opti
43、ons:Stability Maintain the PortfoliolRapidgrowthoutstrippedfinancialandmanagerialresourceslDifficultiesinassimilatingrecentportfolioadditionslSomecurrentSBUsmayhaveseriousfinancialoroperationalproblemslNoattractiveacquisitionopportunitiesavailablelWaitingforenvironmentalchangestodevelop52Restructuri
44、ng:Contraction of ScopelWhyrestructure?Pull-backfromoverdiversification.Attacksbycompetitorsoncorebusinesses.Diminishedstrategicadvantagesofverticalintegrationanddiversification.lContraction(Exit)strategiesRetrenchmentDivestmentspinoffsofprofitableSBUstoinvestors;managementbuyouts(MBOs).Harvesthalti
45、nginvestment,maximizingcashflow.LiquidationCeaseoperations,writeoffassets.53Why Contraction of Scope?lThecausesofcorporatedeclinePoormanagementincompetence,neglectOverexpansionempire-buildingCEOsInadequatefinancialcontrolsnoprofitresponsibilityHighcostslowlaborproductivityNewcompetitionpowerfulemerg
46、ingcompetitorsUnforeseendemandshiftsmajormarketchangesOrganizationalinertiaslowtorespondtonewcompetitiveconditions54Corporate-Level Strategic Options:Retrenchment Cut Back the PortfoliolNeedtodomorethanpauseandrethinkRegaincontrolofinefficientoperationsRebuildresourcesandcompetenciesReconsiderstrate
47、gicdirectionlResultmaybearadicalrestructureandredirectionoftheorganization55Retrenchment OptionslGettingbackdowntofightingweightlReturningtocorebusinessesandcompetencieslSeekinga“whiteknight”totakeoverlSellingtheentireorganizationlDivestingpiecesofthecorporateportfoliolVoluntaryfilingforbankruptcy/r
48、eorganizationlVoluntary/involuntaryfilingforbankruptcy/liquidation56The Main Steps of TurnaroundlChangingtheleadershipReplaceentrenchedmanagementwithnewmanagers.lRedefiningstrategicfocusEvaluateandreconstitutetheorganizationsstrategy.lAssetsalesandclosuresDivestunwantedassetsforinvestmentresources.l
49、ImprovingprofitabilityReducecosts,tightenfinanceandperformancecontrols.lAcquisitionsMakeacquisitionsofskillsandcompetenciestostrengthencorebusinesses.57Tools for Portfolio Analysis and ManagementGraphicalmatrixdiagramsshowingvariablefactorskeytostrategicportfoliosdecisions1.BostonConsultingGroupGrow
50、th-ShareMatrix2.GeneralElectricBusinessScreen58Reviewing the Corporate PortfoliolPortfolioPlanningundertheBostonConsultingGroup(BCG)matrix:IdentifyingtheStrategicBusinessUnits(SBUs)bybusinessareaorproductmarketAssessingeachSBUsprospects(usingrelative market shareandindustry growth rate)relativetooth
51、erSBUsintheportfolio.DevelopingstrategicobjectivesforeachSBU.59The BCG MatrixSource: Perspectives,No.66,“TheProductPortfolio.”AdaptedbypermissionfromTheBostonConsultingGroup,Inc.,1970.60The BCG MatrixlStarsHighrelativemarketsharesinfastgrowingindustries.lQuestionmarksLowrelativemarketsharesinfastgro
52、wingindustries.lCashcowsHighrelativemarketsharesinlow-growthindustries.lDogsLowrelativemarketsharesinlow-growthindustries.61The Strategic Implications of the BCG MatrixlStarsAggressiveinvestmentstosupportcontinuedgrowthandconsolidatecompetitivepositionoffirms.lQuestionmarksSelectiveinvestments;dives
53、titureforweakfirmsorthosewithuncertainprospectsandlackofstrategicfit.lCashcowsInvestmentssufficienttomaintaincompetitiveposition.Cashsurplusesusedindevelopingandnurturingstarsandselectedquestionmarkfirms.lDogsDivestiture,harvesting,orliquidationandindustryexit.62Limitations on Portfolio PlanninglFla
54、wsinportfolioplanning:TheBCGmodelissimplistic;considersonlytwocompetitiveenvironmentfactorsrelativemarketshareandindustrygrowthrate.Highrelativemarketshareisnoguaranteeofacostsavingsorcompetitiveadvantage.Lowrelativemarketshareisnotalwaysanindicatorofcompetitivefailureorlackofprofitability.Multifact
55、ormodels(e.g.,theMcKinseymatrix)arebetterthoughimperfect.63The McKinsey Matrix64Raise Financial CapitallSBUsmaylacktheseparatelegalexistencetodothisontheirownlCorporatecenterperformsthisfunctionbyissuingstockandborrowinglThen,allocatesthecapitaltoSBUsinsomerational,objectivemannerthatmaximizestotalr
56、eturntothecorporationlThisisthepracticeofcorporatestrategicfinancialmanagement65Allocate Resources and ServiceslInadditiontofinancialcapital,corporatecentermaypossessotherresourcesusefultoSBUsHumanresourcemanagementservicesResearchanddevelopmentcapabilityTechnologyassessmentcompetenceInformationtech
57、nologysupportCorporatelegaldepartmentlThesetoomustbeallocatedtotheSBUs66Facilitate Synergies Among SBUslInter-SBUsynergiesareoneofthemainreasonsforassemblingcorporateportfolioslSynergiesdonotoftenoccurnaturally;thecorporatecentermustfosterthemWatcheachSBUsoperationsandstrategiesNoticelacksofresource
58、sandcompetenciesInventoryresourcesorcompetenciesownedbytheSBUsMatchlackingandowningSBUsFacilitateactualsharingamongthem67Forms of Synergy Facilitation (I)lDisseminateknowledgeandbestpracticeslFacilitatetransferofknowledgeassetsandserviceslEncouragecollaborationandcoordinationlArrangetransferofskills
59、andcapabilitieslBuildcentraldatabaseofresourcesandcompetenciesavailabletoallSBUs68Forms of Synergy Facilitation (II)lTemporarilyassignaspecialistfromoneSBUtoanotherlSponsorall-SBUmeetingstoshareinformationandproblemsolutionslCoordinateactivitiesofcommonSBUfunctionstogaineconomiesofscalelProvidesyner
60、gy-supportingeducation,training,andcoachingtoSBUpersonnel69Choose a Corporate Parenting StylelConsciouschoiceonhowthecorporatecenterwillinteractwithSBUsinitsportfoliolRangealongacontinuumfromcompletedetachmenttointrusivemicromanagementlChoicewillaffectbehaviorandperformanceofSBUtopmanagementlTooloos
61、eparentingcanleadtorogueSBUslTootightparentingcanstiflecreativespontaneity70Participate in SBU Strategy-MakinglCorporatedegreeofinvolvementinSBUstrategicmanagementisaparentingchoicelDifferencebetweenatrueSBUandadivisionordepartmentofabusiness:SBUgreatautonomyandfreedomofactionDivisionclosecentraldir
62、ectionandcontrollEssenceofSBUsuccessisinentrepreneurialimpulsesoftheirtopexecutives71Oversee and Monitor SBU PerformancelEverycorporatecentermustmonitortheperformanceofSBUsinitsportfolio:AretheymeetingthestrategicobjectivesoftheSBUandtheoverallcorporation?Aretheyfinanciallyhealthy?Arethereanylooming
63、problems?Aretopexecutivesmeetingpersonalperformancestandards?72Managing Relationships With External StakeholderslEveryorganizationhasnumerousstakeholderswhomustbetendedtolMeaningofterm“stakeholder”lExamplesofhealthcarestakeholders:Suppliers(employees,unions,contractors)Customers(patients,payers)Comp
64、etitorsRegulatorsCapitalsources(donors,grantors,shareholders,lenders)Media73Corporate Value NegationlSystemsandapprovalsthataddcosts,delaydecisions,andslowmarketresponsivenesslInsulateSBUexecutivesfromrealitiesandpressuresoffinancialmarketslPortfoliosolargeanddiversethatnocommonthemeisapparentlOverl
65、ylargecorporateHQthatincurexpensewithoutprovidingaddedvaluetoSBUs74Strategic AlliancelAstrategicallianceisacooperativestrategyinwhichfirmscombinesomeoftheirresourcesandcapabilitiestocreateacompetitiveadvantagelAstrategicallianceinvolvesexchangeandsharingofresourcesandcapabilitiesco-developmentordist
66、ributionofgoodsorservices75CombinedCombinedResourcesResourcesCapabilitiesCapabilitiesCore CompetenciesCore CompetenciesResourcesResourcesCapabilitiesCapabilitiesCore CompetenciesCore CompetenciesResourcesResourcesCapabilitiesCapabilitiesCore CompetenciesCore CompetenciesStrategic AllianceFirm AFirm
67、AFirm BFirm BMutual interests in designing, manufacturing,Mutual interests in designing, manufacturing,or distributing goods or servicesor distributing goods or services76Types of Cooperative StrategieslJointventure:twoormorefirmscreateanindependentcompanybycombiningpartsoftheirassetslEquitystrategi
68、calliance:partnerswhoowndifferentpercentagesofequityinanewventurelNonequitystrategicalliances:contractualagreementsgiventoacompanytosupply,produce,ordistributeafirmsgoodsorserviceswithoutequitysharing77Strategic AlliancesMarginMarginPrimaryActivitiesSupportActivitiesServiceMarketing&SalesOutboundLog
69、isticsOperationsInboundLogisticsFirmInfrastructureHumanResourceMgmt.TechnologicalDevelopmentProcurementMarginMarginPrimaryActivitiesSupportActivitiesServiceMarketing&SalesOutboundLogisticsOperationsInboundLogisticsFirmInfrastructureHumanResourceMgmt.TechnologicalDevelopmentProcurementVertical Allian
70、ceVertical AllianceSupplierSupplierverticalcomplementarystrategicallianceisformedbetweenfirmsthatagreetousetheirskillsandcapabilitiesindifferentstagesofthevaluechaintocreatevalueforbothfirmsoutsourcingisoneexampleofthistypeofalliance78Strategic AlliancesMarginMarginPrimaryActivitiesSupportActivities
71、ServiceMarketing&SalesOutboundLogisticsOperationsInboundLogisticsFirmInfrastructureHumanResourceMgmt.TechnologicalDevelopmentProcurementMarginMarginPrimaryActivitiesSupportActivitiesServiceMarketing&SalesOutboundLogisticsOperationsInboundLogisticsFirmInfrastructureHumanResourceMgmt.TechnologicalDeve
72、lopmentProcurementBuyerBuyerPotential CompetitorsPotential Competitorshorizontal complementary strategic alliance is formed between partners who agree to combine their resources and skills to create value in the same stage of the value chainfocus on long-term product development and distribution opportunitiesthe partners may become competitorsrequires a great deal of trust between the partnersBuyerBuyer79
