ORCHESTRATING STRATEGIC ALLIANCES

Introduction
TORSTEN OLIVER SALGE | Aachen

School of Business and Economics

TIME Research Area | Innovation, Strategy and Organization Group (ISO)
TIME Research Area | Innovation, Strategy and Organization Group (ISO)

LEARNING OBJECTIVES
Outlining the objectives of this video

 To observe strategy in action

(ILLUSTRATION)

 To reflect upon the importance of competitive and cooperative strategy

(REFLECTION)

 To obtain a sneak preview of all subsequent videos on the session theme

(PREVIEW)

© Torsten Oliver Salge 2

TIME Research Area | Innovation, Strategy and Organization Group (ISO)

INTRODUCTION | Illustration
Developing a unique value curve and setting new standards
high

Tesla Model 3

Conventional Cars

Most Electric Cars

low
Afforda- Environmental Driving Design Reach Fuelling Grit Fuel Connec- Automated
bility Friendliness Performance Density Cost tivity Driving

© Torsten Oliver Salge Source: Kim & Mauborgne (2015) 3

TIME Research Area | Innovation, Strategy and Organization Group (ISO)

INTRODUCTION | Illustration
… to create a mass market for electric cars

UNOCCUPIED, GROWING
high MOST ESTABLISHED CAR MARKET SEGMENT
MODELS WITH
CONVENTIONAL
ENGINES
PERFORMANCE
TO PRICE
RATIO
MOST CURRENT CAR
MODELS WITH
low ELECTRIC
ENGINES

low ENVIRONMENTAL high

FRIENDLINESS

© Torsten Oliver Salge 4

TIME Research Area | Innovation, Strategy and Organization Group (ISO)

INTRODUCTION | Illustration
Breaking all launch records in automotive history with its Model 3

 Model 3 with 232,000 pre-

orders within the first two
days after launch event in
March 2016
 Citroen DS as prior record
holder with 80,000 pre-
orders during first 10 days
(Paris Motor Show, 1955)
 Nissan Leaf (previously most
successful electric car) with
cumulated worldwide sales
211,000 units between 2010
and 2016
 12,400 electric cars
registered in Germany
in 2015
© Torsten Oliver Salge Source: Bloomberg News (2016); Tesla (2016); Wikipedia (2016) 5
TIME Research Area | Innovation, Strategy and Organization Group (ISO)

INTRODUCTION | Illustration
… and becoming a bestseller virtually over night

Tesla Model 3 Pre-Orders in Units by Day after Launch Event

450.000

400.000
361,000 units sold in the US in 2015
350.000

300.000

250.000 2015 cumulated US sales

of the Toyota Camry
200.000 - the bestselling car in the US

150.000

100.000

50.000

0
0 2 4 6 8 10 12 14 16
© Torsten Oliver Salge Source: Forbes (2016); Tesla (2016) 6
TIME Research Area | Innovation, Strategy and Organization Group (ISO)

INTRODUCTION | Illustration
Generating expected sales of 14 billion USD (total sales 2015: 4 bn)

Pre-Orders
as of May 2016 Average price

≈ 400k Tesla Model 3 $35k - $42k

US Sales in 2015
361k Toyota Camry $21k - $28k
307k Toyota Corolla $17k - $20k
295k Honda Accord $17k - $20k
283k Nissan Altima $22k - $28k
278k Honda Civic $22k - $29k

255k Ford Fusion $18k - $22k

210k Hyundai Elantra $22k - $26k

194k Chevrolet Cruze $17k - $21k

180k Ford Focus $16k - $23k

174k Hyundai Sonata $17k - $23k

© Torsten Oliver Salge Source: Forbes (2016); Tesla (2016) 7

TIME Research Area | Innovation, Strategy and Organization Group (ISO)

INTRODUCTION | Illustration
Entering the era of mass production

Tesla Sales and Pre-Orders by Car Model in Units

≈ 400,000
Cumulated model S/X deliveries

Non-binding model 3 pre-orders

107.000

57.000
25.000
2.600

2012 2013 2014 2015 Model 3 pre-

orders (as of May
2016)
© Torsten Oliver Salge Source: Tesla (2016), statistica.com (2016) 8
TIME Research Area | Innovation, Strategy and Organization Group (ISO)

INTRODUCTION | Reflection
Mastering the challenges of high-quality mass production

Is this huge demand good news or bad news for Tesla?

How can Tesla satisfy the huge demand and scale up its production?
Can Tesla do it alone or should they partner?

YOUR VIEW

© Torsten Oliver Salge 9

TIME Research Area | Innovation, Strategy and Organization Group (ISO)

INTRODUCTION | Reflection
Introducing Tesla’s Gigafactory, Nevada

 Yearly production target of

500,000 electric cars plus
ambitious Powerwall goals
 This would absorb entire
2013 world production of
lithium-ion batteries
 Gigafactory with annual cell
output (35 GWh) bigger than
sum of all existing lithium-ion
factories in the world
 One of biggest buildings in
the world, construction
started in 2014
 Reduce unit costs
by more than 30%

© Torsten Oliver Salge Source: Tesla (2016), Gigafactory rendering 10

TIME Research Area | Innovation, Strategy and Organization Group (ISO)

INTRODUCTION | Reflection
Partnering with Panasonic to build and operate the Gigafactory

“Do you think it was a smart move for Tesla to partner with Panasonic or should
Tesla have done it alone? Why?
(You, today)

© Torsten Oliver Salge Source: Motor Trend Channel (2016), Gigafactory at 14% completion 11
TIME Research Area | Innovation, Strategy and Organization Group (ISO)

INTRODUCTION | Reflection
Partnering with Panasonic to build and operate the Gigafactory

“I believe that once we are able to manufacture lithium-ion battery cells at the
Gigafactory, we will be able to accelerate the expansion of
the electric vehicle market.”
(Y Yamada, Executive Vice President of Panasonic, 31 July 2014)

© Torsten Oliver Salge Source: Motor Trend Channel (2016), Gigafactory at 14% completion 12
TIME Research Area | Innovation, Strategy and Organization Group (ISO)

INTRODUCTION | Reflection
Partnering with Panasonic to build and operate the Gigafactory

“Gigafactory represents a fundamental change in the way large scale

battery production can be realized. Not only does the Gigafactory
enable capacity needed for the Model 3, but it sets the path for a
dramatic reduction in the cost of energy storage.”
(JB Straubel, CTO and Co-Founder of Tesla Motors, 31 July 2014)

© Torsten Oliver Salge Source: Motor Trend Channel (2016), Gigafactory at 14% completion 13
TIME Research Area | Innovation, Strategy and Organization Group (ISO)

INTRODUCTION | Preview
Identifying key questions to be addressed

What is the case for cooperative strategy? When should we move

1 from a competitive to a cooperative mindset?

2 What are strategic alliances and what is their payoff?

How can firms build and orchestrate collaborative ecosystems to

3 enhance their (innovative) performance?

© Torsten Oliver Salge 14

TIME Research Area | Innovation, Strategy and Organization Group (ISO)

INTRODUCTION | Preview
Exploring cooperative strategies

Competitive Competitive
Market Resource
View View
(Session 2) (Session 3)
Strategy
Process Strategy Content
(Session 1)

Competitive Cooperative
Positioning
(Session 4) (Session 5)

Strategy Context
(Session 6)
© Torsten Oliver Salge 15
TIME Research Area | Innovation, Strategy and Organization Group (ISO)

INTRODUCTION | Preview
Previewing key insights from our subsequent videos

Strategic Alliances Collaborative Networks

 Alliance Purpose. 2  Ecosystems. Uncover 4

Explore the concept and the key elements of
different types of effective ecosystem
strategic alliances orchestration

 Alliance Pay-Off. 3  Open Innovation. Learn 5

Reflect upon the about open innovation as
opportunities and risks a collaborative approach
of strategic alliances to new product
development

6
Understand the value of cooperative strategy
© Torsten Oliver Salge 16
TIME Research Area | Innovation, Strategy and Organization Group (ISO)

INTRODUCTION | Readings
Sources and further readings
Chesbrough, H. W. (2003). Open Innovation: The New Imperative for Creating and Profiting from Technology.
Harvard Business Press.
Cosh, A., & Hughes, A. (2003). Enterprise Challenged: Policy and performance in the British SME sector 1999-
2002 (pp. 1-132). ESRC Centre for Business Research.
Dahlander, L., & Gann, D. M. (2010). How open is innovation?. Research Policy, 39(6), 699-709.
De Rond, M. (2007). Lecture notes on strategic management. Judge Business School, University of Cambridge
De Rond, M., & Bouchikhi, H. (2004). On the dialectics of strategic alliances. Organization Science, 15(1), 56-
69.
De Wit, B. & Meyer, R. (2014). Strategy: An International Perspective. Cengage Learning.
Dhanaraj, C. & Parkhe, A. (2006). Orchestrating innovation networks. Academy of Management Review, 31(3),
659-669.
Forbes (2016). Tesla Model 3: This is what a game changer looks like.
Ghoshal, S. & Bartlett, C. A. (1990). The multinational corporation as an interorganizational network. Academy
of Management Review, 15 (4), 603–625.
Grant, R. M. (2016). Contemporary Strategy Analysis. John Wiley and Sons. 8th Edition.
Gulati, R. (1998). Alliances and networks. Strategic Management Journal, 19, 293–317
Statistica (2016). Tesla Deliveries and Pre-Orders. Accessed on 23 May 2016 via:
https://www.statista.com/chart/4586/tesla-deliveries-and-pre-orders/

© Torsten Oliver Salge 17

TIME Research Area | Innovation, Strategy and Organization Group (ISO)

CONTACT US
Contact details and disclaimer

School of Business and Economics Images used:

TIME Research Area  Compass: Pdpics.com, 23 March 2016. Web.
Innovation, Strategy & Organization Group (ISO) http://www.pdpics.com/preview/preview35/6833-
compass-map.jpg
 Tesla Images: 2 May 2016. Web. teslamotors.com
Kackertstraße 7  Tesla Logo: 4 April 2016. Web.
http://www.teslamotors.com
52072 Aachen
 Tesla Gigafactory: 23 May 2016,
Germany https://www.teslamotors.com/gigafactory

Phone: +49 241 80 99197

Mail: [email protected]
Web: www.time.rwth-aachen.de/iso

© Torsten Oliver Salge 18

ORCHESTRATING STRATEGIC ALLIANCES
Strategic Alliances I: Alliance Purpose
TORSTEN OLIVER SALGE | Aachen

School of Business and Economics

TIME Research Area | Innovation, Strategy and Organization Group (ISO)
TIME Research Area | Innovation, Strategy and Organization Group (ISO)

LEARNING OBJECTIVES
Outlining the objectives of this video

 To define and delineate the concept of strategic alliances

(FOUNDATIONS)

 To illustrate the nature of strategic alliances

(ILLUSTRATION)

 To uncover the various types of strategic alliances

(TYPOLOGY)

© Torsten Oliver Salge 2

TIME Research Area | Innovation, Strategy and Organization Group (ISO)

ALLIANCE PURPOSE | Foundations

Recognizing the value of cooperative strategy

Market-Based View
Firm-Centric Perspective Resource-Based
Network View
Perspective

Headquarter

Subsidiary

External
Partner
Formal Linkage

Informal Linkage

Internal network

External
network

 Firms operating in isolation  Firms embedded in web of relationships

 Competitive advantage through resources  Competitive advantage through resources
possessed by the focal firm shared between network members
 Focus on competitive strategy  Focus on cooperative strategy
(firms against firms) (networks against networks)

© Torsten Oliver Salge Source: Ghoshal & Bartlett (1990) 3

TIME Research Area | Innovation, Strategy and Organization Group (ISO)

ALLIANCE PURPOSE | Foundations

Working with partner organizations to achieve a common goal

Strategic Alliances
as formal and “voluntary arrangements between firms involving exchange, sharing, or
co-development of products, technologies, or services. They can occur as a result of a
wide range of motives and goals, take a variety of forms, and occur across vertical and
horizontal boundaries“ (Gulati 1998, 293).

Constitutive Elements Related Concepts

 Formal arrangement  Networks
 Strategic relevance >> beyond dyadic relationships
 Joint contribution of resources  Mergers & Acquisitions
>> partners lose independence
 Shared control and risk
>> no fixed end date
 Typically fixed end date
 Informal collaboration
 Continued independence of partner >> no formal arrangement
>> benefit might be one-sided
© Torsten Oliver Salge Source: Gulati (1998) 4
TIME Research Area | Innovation, Strategy and Organization Group (ISO)

ALLIANCE PURPOSE | Foundations

Depicting the configuration of strategic alliances

Firm A Firm B

Resources Resources
Capabilities Capabilities

Combined
Resources
Capabilities

Mutual interests in jointly designing, manufacturing,

or distributing goods or services

© Torsten Oliver Salge Source: Grant (2016) 5

TIME Research Area | Innovation, Strategy and Organization Group (ISO)

ALLIANCE PURPOSE | Illustration

Revisiting Tesla’s Gigafactory, Nevada

How would you describe the configuration of the Gigafactory alliance

between Tesla and Panasonic?

YOUR VIEW

© Torsten Oliver Salge 6

TIME Research Area | Innovation, Strategy and Organization Group (ISO)

ALLIANCE PURPOSE | Illustration

Revisiting Tesla’s Gigafactory, Nevada

 Annual cell output of 35

GWh and pack output of 50
GWh for Powerwall (more
than all lithium-ion factories in
the world combined)
 One of biggest buildings in
the world of around 100
football fields, construction
started in 2014
 Objective to reduce battery
costs by more than 30%
 Total investment of around
4-5bn USD required
through 2020
 Estimated 6,500
employees
© Torsten Oliver Salge Source: Tesla (2016) 7
TIME Research Area | Innovation, Strategy and Organization Group (ISO)

ALLIANCE PURPOSE | Illustration

Unpacking the Gigafactory alliance

Manufacture and
Prepare, provide and
supply lithium-ion cells
manage the land,
and invest in the
buildings and utilities
associated equipment

≈ 1.6bn USD investment ≈ 2bn USD investment

Mutual interests in meeting the future demand

for lithium-ion batteries

© Torsten Oliver Salge Source: Tesla (2016) 8

TIME Research Area | Innovation, Strategy and Organization Group (ISO)

ALLIANCE PURPOSE | Typology

Illustrating the concept of strategic alliances

Exploitative Alliance Explorative Alliance

 Alliance type  Alliance type
Exploitative (production) (start: 2014) Explorative (R&D) (start: 2016)
 Alliance objective  Alliance objective
Build and operate Gigafactory I, Nevada Develop a self-driving minivan prototype
 Partner Profile  Partner Profile
Panasonic is a Japanese electronics MNE Alphabet Inc. is an American multinational
with approx. 250,000 employees conglomerate and parent of Google
 Terms of Agreement  Terms of Agreement
 Tesla will prepare, provide and  FCA will provide 100 new minivans for
manage the land, buildings and testing
utilities  Alphabet will provide the required
 Panasonic will manufacture and sensors and computers
supply cylindrical lithium-ion cells

© Torsten Oliver Salge 9

TIME Research Area | Innovation, Strategy and Organization Group (ISO)

ALLIANCE PURPOSE | Typology

Distinguishing forms of strategic alliances

According to you, in which other meaningful ways

can alliances possibly differ?

YOUR VIEW

© Torsten Oliver Salge 10

TIME Research Area | Innovation, Strategy and Organization Group (ISO)

ALLIANCE PURPOSE | Typology

Distinguishing alliances by type of equity ownership

Alliance Type Defining Elements Example

Equity Joint Venture  Alliance partners form new legally Panasonic-Tesla
independent, often temporary entity
 Alliance partners contribute resources
and capabilities to new entity, which
they jointly own
Equity Alliance  Narrow definition: Alliance partners as Daimler-Tesla
minority shareholders of each other
 Broad definition: At least one partner
takes partial ownership in the other
partner
Non-Equity Alliance  Alliance partners do not hold equity in Alphabet-FCA
each others’ firms or a new venture
 Alliance is based on contractual
agreement to share resources and
capabilities for a common purpose

© Torsten Oliver Salge 11

TIME Research Area | Innovation, Strategy and Organization Group (ISO)

ALLIANCE PURPOSE | Typology

Distinguishing alliances by market position of partner

Alliance Type Defining Elements Example

Vertical  Alliance partners are located at Panasonic-Tesla
different levels of the value chain
 Alliance typically focused on cost
reduction, resource complementarities
and core competences
Horizontal  Alliance partners are competitors Audi-BMW-Daimler
within the same market
 Alliance typically focused on cost
reduction, risk sharing or bundling of
bargaining power
Lateral  Alliance partners are not part of a Alphabet-FCA
competitive or value chain relationship
 Alliance typically focused on meeting
complementary customer needs
(e.g. car company and )

© Torsten Oliver Salge 12

TIME Research Area | Innovation, Strategy and Organization Group (ISO)

ALLIANCE PURPOSE | Typology

Distinguishing alliances by their strategic purpose

Alliance Type Defining Elements Example

Synergistic  Creates economies of scope and Panasonic-Tesla
scale between alliance partners
 Typically pertain to a well-defined
element of the supply chain (e.g.
development or production)
Diversifying  Enables entry into new product areas Audi-BMW-Daimler
or market segments
 Enables access into new geographical
markets

Complementary  Provides alliance partners with access Alphabet-FCA

to complementary resources or
capabilities
 Can pertain to the same stage of the
value chain or a different stage

© Torsten Oliver Salge 13

TIME Research Area | Innovation, Strategy and Organization Group (ISO)

CONTACT US
Contact details and disclaimer

School of Business and Economics Images used:

TIME Research Area  Compass: Pdpics.com, 23 March 2016. Web.
Innovation, Strategy & Organization Group (ISO) http://www.pdpics.com/preview/preview35/6833-
compass-map.jpg
 Panasonic Logo: Wikipedia. 22 May 2016,
Kackertstraße 7 https://commons.wikimedia.org/wiki/File:Panasonic_l
ogo_%28Blue%29.svg
52072 Aachen
 Tesla Logo: 4 April 2016. Web.
Germany http://www.teslamotors.com
 Gigafactory: 23 May 2016. Web.
http://www.teslamotors.com
Phone: +49 241 80 99197  Daimler Logo: Wikipedia. 22 May 2016,
https://en.wikipedia.org/wiki/Daimler-
Mail: [email protected]
Benz#/media/File:Daimler_logo.jpg
Web: www.time.rwth-aachen.de/iso  Alphabet Logo: Wikipedia. 22 May 2016,
https://commons.wikimedia.org/wiki/File:Alphabet_In
c_Logo_2015.svg
 FCA Logo: Wikipedia. 22 May 2016,
https://de.wikipedia.org/wiki/Fiat_Chrysler_Automobil
es#/media/File:Logo_Fiat_Chrysler_Automobiles.png
 Audi Logo: Wikipedia. 22 May 2016,
https://commons.wikimedia.org/wiki/File:Audi-
Logo_2016.svg
 BMW Logo: Wikipedia. 22 May 2016,
https://commons.wikimedia.org/wiki/File:BMW.svg

© Torsten Oliver Salge 14

ORCHESTRATING STRATEGIC ALLIANCES
Strategic Alliances II: Alliance Payoff
TORSTEN OLIVER SALGE | Aachen

School of Business and Economics

TIME Research Area | Innovation, Strategy and Organization Group (ISO)
TIME Research Area | Innovation, Strategy and Organization Group (ISO)

LEARNING OBJECTIVES
Outlining the objectives of this video

 To review the main reasons for engaging in collaborative strategies

(MOTIVATION)

 To reflect upon risks related to inter-firm collaboration

(RISKS)

 To derive some simple rules of engagement

(RULES)

© Torsten Oliver Salge 2

TIME Research Area | Innovation, Strategy and Organization Group (ISO)

ALLIANCE PAYOFF | Motivation

Reviewing theoretical arguments for strategic alliances

Market-Based View Resource-Based View

 Industry Structure  Resources
 Decrease competitive rivalry  Gain access to complementary
 Increase own bargaining power vis- resources that would be difficult to
à-vis buyers and suppliers develop or acquire

 Increase barriers to entry  Integrate distinct resources to provide

a superior product / service offering
 Enter new, more attractive markets
 Less resource-intensive than M&A

 Generic Strategies
 Capabilities
 Realize economies of scale and
reduce transaction costs to drive  Gain access to complementary
cost leadership strategy capabilities that would be difficult to
develop or acquire
 Identify opportunities for
differentiation  Focus on core competencies

© Torsten Oliver Salge 3

TIME Research Area | Innovation, Strategy and Organization Group (ISO)

ALLIANCE PAYOFF | Motivation

Examining the view of practitioners: The reasons for collaborating

Expand range of expertise 76%

Develop specialist products 66%

Help to keep current customers 50%

Improve reputation and credibility 46%

Provide access to new markets 46%

Share R&D activity 42%

Provide access to foreign markets 39%

Outsource elements of own output 25%

Spread cost of new equipment 22%

Assist in staff development 17%

Purchase materials or inputs 14%

© Torsten Oliver Salge Source: Cosh & Hughes (2003) 4

TIME Research Area | Innovation, Strategy and Organization Group (ISO)

ALLIANCE PAYOFF | Risks

Examining failure rates of cooperative arrangements

View from Practice View from Academia

 33%- 50% (McKinsey 1991)  50%- 80% (Tomlinson 1970)

 61% (Accenture 1999)  36% (Killing 1983)
 50-59% (PricewaterhouseCoopers 1999)  61% (Beamish 1984)
 64% for R&D partnerships  50% (Harrigan 1985)
 90% for consortia
 52% (PricewaterhouseCoopers 2004)  67% (Auster 1986)

 60%- 70% (The Economist & BCG)  57.1% (Kogut 1988)

 70% (Financial Times 2001)  28% (Inkpen 1993)

 70% (Vantage Partners 2002)  40% (Hebert 1994)

 67% (Cutting Edge Information 2003)  50% (Inkpen & Bamish 1997)
 50% (Park & Ungson 1997)
 48% in < 24 months (Dyer et al. 2004)

© Torsten Oliver Salge Source: De Rond (2007) 5

TIME Research Area | Innovation, Strategy and Organization Group (ISO)

ALLIANCE PAYOFF | Risks

Unpacking the notion of alliance failure

Not meeting objectives

‘Unsatisfactory’
What do
they mean
Not meeting expectations by failure?

Didn’t live out its expected life (abandoned ‘prematurely’) Research has
not always
been consistent
Disappointing from a “relational” perspective, but successful in defining
as a “business” case failure

Good for one but not for the other

© Torsten Oliver Salge Source: De Rond (2007) 6

TIME Research Area | Innovation, Strategy and Organization Group (ISO)

ALLIANCE PAYOFF | Risks

Highlighting the paradox between alliance popularity and failure rates

“We can beat the odds…” An

interesting
“We have no choice…” paradox

How do we
“We are no better at doing this ourselves…”
explain the
popularity of
collaborating in
“In a real options context, high attrition rates are expected…”
the face of
persistently high
“Didn’t give it enough time…” failure rates?

© Torsten Oliver Salge Source: De Rond (2007) 7

TIME Research Area | Innovation, Strategy and Organization Group (ISO)

ALLIANCE PAYOFF | Risks

Identifying common reasons for the failure of strategic alliances

In your opinion, why do strategic alliances often fail to achieve their

initial objectives?

YOUR VIEW

© Torsten Oliver Salge 8

TIME Research Area | Innovation, Strategy and Organization Group (ISO)

ALLIANCE PAYOFF | Risks

Identifying common reasons for the failure of strategic alliances

ENVIRONMENTAL STRATEGIC STRUCTURAL BEHAVIORAL

 Obsolescence due  Inappropriate  Insufficient fit  Insufficient top
to changing partner selection between partner- management
customer  Diverging goals ship purpose and commitment
preferences and strategies type  Staff turnover
 New technological  Marketplace rivalry  Insufficient con-  Insufficient
paths tractual flexibility
 Insufficient transparency
 Unpredicted knowledge sharing  Lack of goal  Mistrust and envy
regulatory changes specificity
 Infeasibility of joint  Internal conflicts
 Cultural differences project

POSSIBLE REASONS FOR STRATEGIC ALLIANCES

TO FAIL TO EXPLOIT THEIR FULL POTENTIAL

© Torsten Oliver Salge Source: De Rond (2007) 9

TIME Research Area | Innovation, Strategy and Organization Group (ISO)

ALLIANCE PAYOFF | Rules

Identifying some simple rules for collaborating

1. Know what you want from the collaboration

Can your potential partner provide this?

2. Understand your partner‘s strengths and weaknesses

Is superficial appearance blinding you?

3. Understand your partner’s capabilities, practices and culture

Are you compatible?

4. Understand why your partner wants to do the deal

What do you look like from their side of the fence? Is it a good deal for all?

5. Prepare your own organization for collaboration

What do you do to persuade internal stakeholders? How do you change attitudes?

6. Invest in building collaborative relationships

What do you do to build trust among partners and enable collaborative behaviour?

© Torsten Oliver Salge Source: De Rond (2007) 10

TIME Research Area | Innovation, Strategy and Organization Group (ISO)

ALLIANCE PAYOFF | Rules

Understanding typical tensions in strategic alliances

Competition

Design Control

Vigilance Trust
Traditional
managerial rhetoric

Contemporary Autonomy Emergence

managerial rhetoric
Cooperation

© Torsten Oliver Salge Source: De Rond & Bouchikhi (2004) 11

TIME Research Area | Innovation, Strategy and Organization Group (ISO)

CONTACT US
Contact details and disclaimer

School of Business and Economics Images used:

TIME Research Area  Compass: Pdpics.com, 23 March 2016. Web.
Innovation, Strategy & Organization Group (ISO) http://www.pdpics.com/preview/preview35/6833-
compass-map.jpg
 Tesla Logo: 4 April 2016. Web.
Kackertstraße 7 http://www.teslamotors.com
52072 Aachen
Germany

Phone: +49 241 80 99197

Mail: [email protected]
Web: www.time.rwth-aachen.de/iso

© Torsten Oliver Salge 12