Solutions to reduce the pitfall of strategic alliances

By | April 11, 2014

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To reduce the incompatibility of partners, negotiations and meetings could be helpful to reduce the conflict between the partners, frequent talks could let all the parties know about the other parties’ idea and thus avoid serious difference and misunderstandings from the very beginning.

To smooth the access to information, the both parties could sign contracts regarding the need to access other party’s secret information, when there are clear contracts even before such information relative problems happen then there will be less conflict and resistance when the problems do happen.

To reduce conflicts over distributing earnings, similar contracts could also helpful to avoid such problems from happening from the very beginning, and what is more, the selecting of part is also important because companies with similar corporate value and ambition could have less such conflicts.

To reduce the loss of autonomy, one party make choose another party as their finance strategic alliance then the other party would not share the control of the joint venture company over the business decisions.

To reduce the risk of changing circumstance, the both side can sign a short contract and by the end of the contract both side could have the right to end their cooperation and choose another party if there are no possibility that their continual cooperation could benefit both parties.