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Introduction

When you think of strategic alliances what companies and products come to mind.  Such companies like AT&T and Apple; with the of course the iPhone and the service it provides, Johnson & Johnson and Merck which worked together to make Pepcid AC, and also Chrysler and Nissan, where Nissan would build Chrysler cars with their hybrid technology.

The Idea in a Nutshell

Strategic alliances are collaborative arrangements where two or more companies join forces to achieve mutually beneficial strategic outcomes.  The competitive attraction of alliances is in allowing companies to bundle competencies and resources that are more valuable in a joint effort than when kept separate. 

The Top Ten Things You Need to Know About Strategic Alliances

Alliances often involve joint marketing, joint income or distribution, joint production, design collaboration, joint research, or projects to jointly develop new technologies or products.

Companies in many different industries all crossways the world have prefabricated strategic alliances a core part of their overall strategy; U.S. companies alone announced almost 68,000 alliances from 1996 through 2003.

Studies indicate that massive corporations are commonly involved in 30 to 50 alliances and that a number have hundreds of alliances.

One current study estimated that about 35 percent of corporate revenues in 2003 came from activities involving strategic alliances.

Another study reported that the typical massive corporation relied on alliances for 15 to 20 percent of its revenues, assets, or income.

The ideal alliances are highly selective, focusing on particular value chain activities and on obtaining a particular competitive benefit.  They tend to enable a firm to build on its strengths and to learn.

The most common reasons why companies enter into strategic alliances are to expedite the development of promising new technologies or products, to overcome deficits in their own technical and manufacturing expertise, to bring together the organisation and expertise needed to create desirable new skill sets and capabilities, to improve supply chain efficiency, to acquire economies of scale in production and/or marketing, and to acquire or improve market access through joint marketing agreements.

There are several instances in which companies find strategic alliances particularly valuable.  A company that is racing for global market leadership needs alliances to: Get into critical country markets quickly, acquire inside knowledge about unfamiliar markets and cultures through alliances with local partners, and access valuable skills and competencies.

A company that is racing to stake out a strong position in an industry of the future needs alliances to: Establish a stronger beachhead for participating in the target industry, master new technologies and build new expertise and competencies, and open up broader opportunities in the target industry.

There are six factors in which companies benefit from entering into alliances and they are:

           1.  Picking a good partner

                  2.  Being sensitive to cultural differences

           3.  Recognizing that the alliance must

                benefit both sides

           4.  Ensuring that both celebrations live up to their

                commitments

           5.  Structuring the decision-making process so

                that actions can be taken quickly when

                needed

           6.  Managing the learning process and then adjusting the

                             alliance agreement over time to fit new circumstances

The Video Lounge

In this video the speaker explains what forms a good strategic alliance and also what one of the huge companies, Microsoft, has done to form strategic alliances.

http://www.youtube.com/watch?v=0ajiNdNV1ZE

My Take

I believe that strategic alliances are a very important strategy in bettering your company and making your company or business more successful.  Forming strategic alliances is one of the ideal ways for a company to increase profits and revenues in a swift way if they take the correct path in choosing a partner.  Like research has shown, most all massive companies this day have multiple alliances with other companies and are adding more regular which is why no new company can pass up the opportunity to form a future alliance.   

References

Gamble, John E., A.J. Strickland III, and Arthur A. Thompson Jr. Crafting and Executing Strategy: The Quest for Competitive Advantage. 17th. New York: McGraw-Hill Companies Inc, 2010. Print.

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Contact Info: To contact the author of “Top Ten Management on Strategic Alliances,” please email Matthew Lancie at matthew.lancie@selu.edu.

Biography

David C. Wyld (dwyld.kwu@gmail.com) is the Robert Maurin Professor of Management at Southeastern Louisiana University in Hammond, Louisiana. He is a management consultant, researcher/writer, and executive educator. His blog, Wyld About Business, can be viewed at http://wyld-business.blogspot.com/. He also serves as the Director of the Reverse Auction Research Center (http://reverseauctionresearch.blogspot.com/), a hub of research and news in the expanding world of competitive bidding. Dr. Wyld also maintains compilations of works he has helped his students to turn into editorially-reviewed publications at the following sites:

Management Concepts (http://toptenmanagement.blogspot.com/)

Book Reviews (http://wyld-about-books.blogspot.com/) and

Travel and International Foods (http://wyld-about-food.blogspot.com/).                

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Introduction

    A firm’s strategy can be defined as the actions that managers take to attain the goals of the firm. For most firms, the preeminent goal is to maximize the value of the firm for its owners and shareholders. To maximize the value of a firm, managers must oppose strategies that increase the profitability of the enterprise and its rate of growth profit overtime.

The Idea in a Nutshell

    For multinational firms, strategy can be broken down into four areas: Global Standardization, Transitional, Localization, and International Strategy. Each one of these areas is important to a company in its own way and can be independent of the other areas.  The appropriateness of apiece strategy varies given the extent of pressures for cost reductions and local responsiveness.

The Top Ten Things You Need to Know About the Different Types of Strategies

1.            International strategy involves taking products first produced for the company’s domestic market and selling them internationally with only minimal local customization. Firms pursuing and international strategy attempt to create value by transferring core competencies from home to foreign subsidiaries.

2.            With international strategy, headquarters typically maintains centralized control over the source of the firm’s core competency, which is usually found in the R&D and/or marketing functions of the firm. All other operating decisions are decentralized within the firm to subsidiary operations in apiece country.

3.            Global Standardization strategy comes from a firm who pursues a focus on increasing profitability and profit growth by reaping the cost reductions that come from economies of scale, learning effects and location economies.

4.            Firms pursuing a global standardization strategy focus on the realization of location and experience curve economies. Typically, these firms operate with a worldwide product division structure.

5.            Localization strategy focuses on increasing profitability by customizing the firm’s goods or services so they wage a good match to tastes and preferences in different national markets.

6.            In localization strategy, the need for coordination between subunits is low. This grants headquarters to manage foreign operations by relying primarily on output and bureaucratic controls and a policy of management by exception.

7.            Transnational strategy takes place in firms that are trying to simultaneously achieve low costs through location economies, economies of scale and learning effects. They differentiate their product offering crossways geographic markets to statement for local differences.

8.            Transnational firms might operate with matrix-type structures in which both product division and geographic areas have significant influence. The need for coordination is high in transnational firms.

9.            Transnational firms tend to mix high degrees of centralization for some operating decisions with high degrees of decentralization for other operating decisions. 

10.            A firm’s strategy must be consistent with the environment in which it operates. If the strategy does not fit the environment, the firm is likely to experience significant performance problems.

The Video Lounge

 http://www.youtube.com/watch?v=v6coDUDCJ10&feature=related

My Take

                  Business strategy, especially in the international marketplace, is more important now than it has ever been. Companies must have a plan in place and be healthy to react swiftly and efficiently when problems arise abroad. International companies must know any and all risks involved before making a decision and once prefabricated they must be healthy to justify those decisions to board members and shareholders alike. While some companies will shy away from international business, deeming the risks too great to chance, other companies will see it as an area of potential growth and development and select to implement the international business strategy that ideal fits their needs and move forward into the future, full speed ahead.

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Contact Info: To contact the author of “Top Ten Management on Strategies,” please email Dwayne Dukes at Dwayne.dukes@selu.edu.

Biography

David C. Wyld (dwyld.kwu@gmail.com) is the Robert Maurin Professor of Management at Southeastern Louisiana University in Hammond, Louisiana. He is a management consultant, researcher/writer, and executive educator. His blog, Wyld About Business, can be viewed at http://wyld-business.blogspot.com/. He also serves as the Director of the Reverse Auction Research Center (http://reverseauctionresearch.blogspot.com/), a hub of research and news in the expanding world of competitive bidding. Dr. Wyld also maintains compilations of works he has helped his students to turn into editorially-reviewed publications at the following sites:

Management Concepts (http://toptenmanagement.blogspot.com/)

Book Reviews (http://wyld-about-books.blogspot.com/) and

Travel and International Foods (http://wyld-about-food.blogspot.com/).                

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Social media marketing for manufacturing companies is growing.

Many manufacturing businesses might be known to be slicing edge, but not where marketing is concerned. That’s not really surprising, since companies that manufacture physical products concentrate on the production process, and marketing is usually tiny more than the income department.

While this might be a generalization, social media marketing can give manufacturing companies exposure to a larger potential customer base. Since most manufacturers sell most of their products to a pipeline of a few regular customers, marketing and income are generally thought of as one and the same.

Some manufacturers sell their products to the consumer market but most sell to other manufacturers who use them in their own products. Because the nature of markets and globalization has impacted each industry, manufacturers that rely on stable income to a regular customer base are particularly vulnerable to market shifts and sentiments. In the information age, social media marketing for manufacturing companies is crucial. Social media marketing lets manufacturers know the dynamics of the market that might affect their business.

Manufacturers who sell to other manufacturers might not know, for example, the consumer thinking of their customers’ customers. This information is most easily garnered by marketing on the social media networks, so manufacturers need to market on those networks, even if they do not sell directly to consumers.

Manufacturers whose products are sold directly to consumers have a more obvious need to market on social media networks. Firstly, they realize the tremendous reach of social networks. They also know that social media marketing is an extremely efficient way to market to consumers, reaching a wider audience for a lower cost than other forms of marketing. They also want to seek information about their products, their industry, and even their competitors directly from consumers.

Every manufacturer should have an active presence on the social networks, and use social media to market on those networks. Many manufacturers have come to the realization that they need to actively market themselves on social media and look upon social media marketing as an integral part of their businesses. Because social media marketing is a highly specialized function, manufacturers should give serious consideration to hire social marketing consultants.

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Introduction

            Focused (or Market Niche) Strategies differ from other generic market strategies in that it concentrates most if not all of its attention on a narrow piece of the total market.  The niche can be defined by geographic uniqueness, by specialized stipulations in using the product, or by special product attributes that appeal only to niche members.  The key to this strategy is to remain focused on your target niche and not grant yourself to attempt appealing to everyone.  A company can lower its costs tremendously by limiting its consumer base to a very specific target market.  This strategy is extremely useful to small or medium sized companies that demand the capital to take on multi-national corporations.  The costs of starting a business with a clearly defined and specific target market are far less than those one would have when launching a global product or service.

The Idea in a Nutshell

            To state that one mortal came up with the market niche strategy would be a stretch.  The truth is this strategy has been utilized since the beginning of civilization, whether it was known by those utilizing it or not.  In ancient times, the largest segment of the population was poor laborers.  This is not the market one sets his sites on when attempting to sell luxurious silk gowns, rare jewels, or the latest invention, trinket, or toy.  The small well-defined segment of nobles was the target niche of ancient times.  One might think that a lot has changed since then, but the truth of the matter is companies such as Godiva Chocolates, Chanel, Gucci, Rolls-Royce, and Haagen-Dazs successfully utilize differentiation-based focused strategies targeted toward particular segments wanting top-of-the-line products and services who are willing to spend more to get the best.  The target market does not have to be wealthy; this is just one example. 

A focused or niche market strategy is one that provides products or services that uniquely appeal to customers in a narrow segment of the market, rather than attempting to appeal to that particular market as a whole.  Community Coffee, of Louisiana, holds a mere 1.1% share of the U.S. coffee market, but it has reported income in excess of 0 million by appealing to a narrow well-defined market.  In addition, Community Coffee holds a 50% share of the coffee market in the Gulf-Coast region where it is distributed.  The world wide web is quite possibly the perfect medium for launching a market niche strategy.  Businesses such as Google, E-Bay, and Match.com went from being ambiguous companies to household obloquy in a matter of years. 

The Top Ten Things You Need to Know About Focused (or Market Niche) Strategies

1.            When employing a focused market strategy, keep your consumer-base down to a well-defined and specific segment of the market, avoiding the temptation of trying to appeal to broad interests.

2.            When utilizing a focused market strategy, watch of competitors trying to match your firm’s abilities in serving the target market.  They will attempt to find effective ways of appealing to your buyers with imitation products or services.

3.            A focused market strategy is saint employed when the specific target consumer-base is massive enough to be profitable and offers good growth potential.

4.            Your firm stands a greater chance at being profitable if you offer different products and services to a specific group or segment of consumers that have unmet preferences.  These customers will be loyal to your business for catering to their one-of-a-kind needs, and they will think of your company first when others ask them where they got such a specific product or service. 

5.            Ferrari markets its 1,500 vehicles sold in North USA each year to a clientele of only 20,000 highly lucrative automobile admirers.  Only those in the highest tier of this exclusive group were contacted by Ferrari for a chance to place their obloquy on the inactivity list for one of the 20 .1 million FXX models.

6.            A swift a decisive strategy should be employed when targeting a narrow segment of any market before consumer preferences tend to drift.

7.            A hyper-focused strategy is saint maintained in those industries in which the leaders do not see having a presence in the niche is critical for their own success.  This reduces the risk of smaller businesses having to effort it out against some of the industry’s strongest competitors for a share of the market.

8.            Over-looked or undervalued market segments are prime territories for employing a laser-focused strategy.  Because these consumers are undervalued by other competitors in the industry, the chances of your consumer-base remaining loyal for the long-term are greater.

9.            Use caution when entering markets where segments might become so alluring it is soon flooded with competitors, augmenting conflict and disintegrating segment profits.

10.            A laser-focused strategy can be actualized if there are social and cultural differences within one community that might call for changes to be implemented in a product or service. This invariably produces a niche market.

The Video Lounge

http://www.youtube.com/watch?v=PHhfDkLrOpA

Guy Kawasaki discusses the key success factors that differentiate a strong niche marketing strategy from a poor or run-of-the-mill one.  The two main areas he stresses to be strong in are the capability to wage a one-of-a-kind product or service to the customer and for that product or service to wage value to the customer.

My Take

I think focused or (market niche) strategies are extremely valuable today.  This would be the saint strategy to implement for any fresh college graduates looking to begin an entrepreneurship.  In addition, the world wide web offers an abundance of channels to get a small firm up-and-running without much start capital.  This demand of start capital is another reason why utilizing this strategy is favorable when entering a market or industry with massive corporations.  Some of the main points I got out of this were to keep your target market down to a specific and narrow market segment,  market segments that are overlooked or undervalued are the prime meat for employing a market niche strategy, and that this strategy is saint maintained in those industries in which the leaders do not see having a presence in the niche is critical for their own success.

References

Jaquier, B. (2003). Focus and niche strategies. Retrieved from http://www.ecofine.com/strategy/Focus and Niche stategies.htm

Marketing niche strategy. (n.d.). Retrieved from http://www.smallbusiness-marketing-plans.com/marketing-niche-strategy.html

Mendoza, M. (n.d.). Focus on your niche. Retrieved from http://www.powerhomebiz.com/vol62/niche.htm

Niche strategy advantages. (n.d.). Retrieved from http://www.marketingtitan.com/niche_strategy_advantages

Thompson, A, Strickland, A, & Gamble, J. (2010). Crafting and executing strategy: the quest for competitive advantage. New York, NY: McGraw-Hill/Irwin, 156-160.

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Contact Info: To contact the author of “Top Ten Management on Focused (or Market Niche) Strategies,” please email archangel B. Ordoyne at w0449274@selu.edu.

Biography

David C. Wyld (dwyld.kwu@gmail.com) is the Robert Maurin Professor of Management at Southeastern Louisiana University in Hammond, Louisiana. He is a management consultant, researcher/writer, and executive educator. His blog, Wyld About Business, can be viewed at http://wyld-business.blogspot.com/. He also serves as the Director of the Reverse Auction Research Center (http://reverseauctionresearch.blogspot.com/), a hub of research and news in the expanding world of competitive bidding. Dr. Wyld also maintains compilations of works he has helped his students to turn into editorially-reviewed publications at the following sites:

Management Concepts (http://toptenmanagement.blogspot.com/)

Book Reviews (http://wyld-about-books.blogspot.com/) and

Travel and International Foods (http://wyld-about-food.blogspot.com/).                

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http://www.syminvest.com

Source : THE DONG-A ILBO

Jul 2010

Seul, South Korea, July, 24 2010 – An investigation into finance companies began Friday after President Lee Myung-bak complained a day primeval that the companies are charging high interest rates while visiting a branch of a micro-finance foundation.

After a meeting with chief directors of micro-finance foundations at the Bankers Club in Seoul Friday, Financial Services Commission Chairman Chin Dong-soo told reporters that a probe will start into finance companies imposing high interest rates on loans to individuals and devise countermeasures.

“A 30-percent interest rate is very high,” he said. “Through an in-depth investigation, we will devise measures to assist the burden on the working class.”

“The main operations of finance companies are leasing, installment financing and providing auto loans, but unsecured loans statement for a significant share of their operations,” he added. “This means demand for livelihood funds and emergency loans is high in the market, but interest rates in the 30-percent level is excessive.”

The marketing share of unsecured loans among finance companies is around five percent and the amount of extended loans is about three trillion won (2.5 billion U.S. dollars). The interest rate on loans for individuals at such companies is an annual average of 32.6 percent and the default rate is near the legal limit of 44 percent.

Financial authorities estimate that the financing costs of finance companies are five to nine percent and that bad debt reserves are more than five percent. Though costs for management and collecting from borrowers are included, the combined cost of financing is under 10 percent, making 30 percent excessive, they said.

To improve the interest rate systems of finance companies, the commission and the Financial Supervisory Service will soon set up a fact-finding team to examine financing and marketing costs of such companies and conduct on-site investigations if necessary.

Financial authorities will also crack down on the illegal practice of paying high fees to loan collectors to increase their numbers.

Finance companies will also be encouraged to make interest rate cuts by removing handling fees similar to upfront interest. Generally, they impose around three percent of the loan amount as a handling fee.

Credit card companies, which had been at the center of controversy for charging high interest for cash services, eliminated handling fees primeval this month.

Separately, financial authorities will reduce the interest burden on the working class, who are excluded from institutional financing, by invigorating micro-finance and the “sunshine loan” system designed to lend start and emergency funds to low-income households at low interest.

Chairman Chin said, “After the Asia-wide foreign currency crisis and the latest global financial crisis, the financial situations of low-income households with low credit ratings have gotten worse,” adding, “We should help the working class` finances to gradually grant a soft landing by expanding guaranteed sunshine loans.”

He also told the micro-finance chief directors, “I urge operators of micro-finance foundations to return to the basics and make each effort to help low-income households with low credit ratings.”

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