The Consumer Electronics Show (CES) often is the platform for a number of announcements.
It is not too surprising that YAHOO! and GOOGLE will be battling it out for the Mobile Market. What is interesting from a strategic management standpoint is the way that the alliances are shaking out.
Samsung working with both companies. Motorola with Yahoo!.
Why is it that we are seing so much of this partnering and alliance activity in all businesses?
Gene A. Wright
Sunday, January 21, 2007
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5 comments:
I think the whole idea is to limit the amount risk and spread the committment of resources in order to provide new solutions to marketplace. Add diversification with collaboration amongst different organizations yet tap into the each organization's expertise. I believe that companies are willing to share the spoils in order to innovate quicker and better.
Over the weekend Motorola announced a 3500 headcount reduction. See the link below. Strategies to increase the bottom line can force future collaboration.
http://www.chicagotribune.com/business/chi-0701200023jan20,0,918349.story?coll=chi-business-hed
mpk
It is becoming common throughout industry because companies are focusing on their core competencies, their business plan. It is not in a company's best interest to invest a large amount of resources and efforts into something they know little about. They have a strategy and focused effort on specific aspects pertaining to their customers. It is smart to partner with another company whose core competencies are what you are looking for.
I think back to when I took a tour of Oshkosh truck early in high school. I was amazed to learn that Oshkosh Truck did not have an assembly line that produced every component on the truck, from beginning to end. It made sense for Oshkosh Truck to purchase components from industry leaders...they used Dana axles, cabs built through an operator's station vendor, electronics and control systems through another vendor. This left the operation and responsibility with other organizations that had expertise in these areas. Oshkosh Truck could devote their efforts on the design and implementation on the entire package, whether for the military, contractors, or fire/rescue.
Few years back it was even hard to see if Google could ever compete with Yahoo. Then came an era where Google was way ahead of the race. People cherish this new roadmap. Now along with the Internet based search engine competition there comes this new phase where more and more gadgets are involved. For example cell phones w.r.t to this article. It is amazing to see now along with them even the electronic companies like Samsung, Sony and other would compete to win a race. It is another question to see whether there would be a collaborative, compromising or Dictate type of merger between the electronic making companies and different search engines.
Companies have been teaming up for a long time in an attempt to overcome or remain on top of the competition. We have seen the trend in the retail markets for decades. It will only be natural for technology oriented organizations to do the same. I agree that naturally they will team up with organizations that have complementary core competencies and talents.
~ Emily
Partnering with another company increases their chances of increasing sales of their products. In the Motorola/Yahoo scenario, it would appear that Motorola believes that die-hard Yahoo users will be more likely to buy their phone instead of a competitor’s, thus increasing their market share.
In general, the partnering strategy is based on complementing a core competency of one company with that of another company where both companies can benefit from the increase in sales or usage. One of the underlying benefits – and in many cases expectations – is that more resources within both companies can focus on the next generation of products or enhancements. They are win-win opportunity possibilities when both companies are progressive.
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