Question 1

Alliances are the only feasible way to develop a position in multiple countries and regions.

Accepted Answer

While alliances provide many advantages,especially in entering new markets,there are strengths and weaknesses associated with every type of collaboration as well as non-collaborative forms.As such,companies should always consider different alternatives and choose the one that best fits their specific situation.

Question 2

Equality between partners is essential,regardless of the governance structure.

Accepted Answer

Committees consisting of an equal number of participants from both companies and operating under strict norms of equality are often incapable of providing clear direction or resolving conflict at lower levels.To find their way around such problems,partners must negotiate on the basis of "integrative" rather than "distributive" equality,with each company taking responsibility for different tasks.

Question 3

Strategic alliances with customers are a form of collaboration that enable MNEs to increase their bargaining power and reduce their costs.

Accepted Answer

Building partnerships with customers can bolster the customer's competitive position,and at the same time,leverages the competitiveness and innovative capabilities of the MNE.It does not necessarily increase bargaining power or reduce costs.

Question 4

Interface managers should be well acquainted with the company's internal organizational processes and should have access to key managers in different parts of the organization.

Accepted Answer

The selection of appropriate interface managers is an important factor for facilitating learning and knowledge flow in an alliance.Interface managers should have at least three key attributes: they must be well versed in the company's internal organizational process they must have the personal credibility and status necessary to access key managers in different parts of the organization and they must have a sufficiently broad understanding of the company's business and strategies to be able to recognize useful information and knowledge that might cross their path.

Question 5

In industries in which there is a dominant worldwide market leader,joint ventures,strategic alliances,and networks allow coalitions of smaller partners to compete more effectively against a global "common enemy" rather than one another.

Accepted Answer

Joint ventures, strategic alliances, and networks allow smaller partners to pool their resources and expertise to compete more effectively against larger market leaders. By working together and focusing on a common enemy, these coalitions can increase their competitiveness and improve their chances of success.

Question 6

Cross-border collaborations have become increasingly important.While the size of an MNE's corporate allies is extremely important to the MNE's performance,the quality of its corporate allies is only marginally important to the MNE's performance.

Accepted Answer

Choosing a partner with high quality capabilities is always important.

Question 7

Strategic alliances are only forged for long durations.Firms should not enter collaborative agreements with a short-term horizon.

Accepted Answer

There is no optimal time frame for strategic alliances.The objectives of the partners are often more important than the duration of the alliance.In fact,strategic alliances are often forged only for short durations.

Question 8

Entering collaborative relationships with other firms is one way for firms to meet the needs of an increasingly complex environment.

Accepted Answer

In the international business environment of the 21ˢᵗ century,few companies have all the resources and capabilities they need to develop multidimensional strategies.Collaborating with other firms is one way to meet the needs of an increasingly complex environment.

Question 9

Pre-alliance analysis is sufficient to ensure the success of a collaborative agreement.

Accepted Answer

Certainly the quality of the pre-alliance analysis is important.However,many other factors also influence success.Solid pre-analysis activity is a necessary but not sufficient condition for success.

Question 10

Which of the following is not a benefit of a strategic alliance?
A) Firms can transfer their technologies to new markets and increase their revenues from licensing fees.
B) Firms can transfer employees to other organizations to reduce operating costs and acquire new knowledge through the employees they transfer.
C) Firms can gain access to new markets for existing products and learn important new skills from the partner.
D) Firms can share costs and develop new technologies together without being fully integrated.

Accepted Answer

There are many benefits to strategic alliances,such as risk sharing,transfer of technologies,access to new markets,acquisition of knowledge,etc.However,transferring employees to reduce operating costs is not one of these benefits.

Question 11

The risks associated with collaboration are limited to the inability of both firms to agree on the terms of the partnership.

Accepted Answer

The risks of collaborating with other firms may be important when it involves competitors.As such,there is always the risk that one of the partners will learn faster than the other partner,leading to the development of a competitive edge over the other partner.Collaboration may also be a precursor for a takeover by the other partner,or result in one partner trying to capture investment initiative to use the partnership to erode the other's competitive position.Despite these risks,such Machiavellian intentions and actions are not the norm.In most instances,MNEs are able to resolve the risks and costs of collaboration.

Question 12

Collaboration reduces the time and risk associated with the development of new products.

Accepted Answer

By sharing assets and capabilities,firms can reduce the time and risk associated with the development of new products

Question 13

International joint ventures continue to be a primary means to enter foreign markets.

Accepted Answer

International joint ventures are still a common strategy used by companies to enter foreign markets. By collaborating with a local partner, companies can access local knowledge, resources, and networks, while sharing risks and costs. Joint ventures can also help companies navigate regulatory and cultural barriers, while building relationships and reputation in the foreign market.

Question 14

Partners should be selected on the basis of comfort rather than competence.

Accepted Answer

Partners should not be selected on the basis of comfort rather than competence.

Question 15

A vast majority of successful cross-border collaborations are founded and maintained by firms that acquire the other partner's knowledge without sharing their own knowledge.

Accepted Answer

Successful cross-border collaborations are based on mutual collaboration between the partners.As such,both partners must be willing to share their own knowledge and to use it in the best interests of the partnership.

Question 16

Once an alliance is formed,the goals,tasks and management processes of the alliance must be constantly monitored and adapted to changing conditions.

Accepted Answer

Because alliances evolve and change over time,it is essential for both partners to constantly monitor the alliance and adapt the goals,tasks and management processes to changing conditions.

Question 17

While the investment and growth benefits associated with partnering generally yield substantial benefit to smaller firms that are pursuing rapid growth with limited resources,these benefits diminish with size such that the very largest MNEs generally find that the benefits of "going it alone" exceed the costs associated with partnering.

Accepted Answer

Even the very largest MNEs have recognized the investment and growth benefits associated with partnering rather than "going it alone."For examples,see the auto industry.

Question 18

Formulating an agreement with respect to the termination of the venture at the outset of the collaboration demonstrates that the partners are not fully dedicated to the success of the alliance.

Accepted Answer

The dissolution of a partnership is not necessarily synonymous with failure.In order to manage possible eventual termination successfully,it is reasonable to discuss up front with the other partner the rights and responsibilities of each should this occur.

Question 19

Equity joint ventures are the preferred mode of arranging an alliance and should be employed whenever multiple companies are intending to collaborate.

Accepted Answer

Many forms of partnership exist,each representing a tradeoff.Multinationals are increasingly relying upon highly flexible and globally-oriented interorganizational networks to supplement their more traditional dyadic alliances and partnerships.

Question 20

The objectives of an alliance are more difficult to achieve when there is a greater number of joint activities,equity cross-holdings and cross-functional coordination.

Accepted Answer

The objectives of an alliance are more difficult to achieve and the likelihood of problems arising is increased in the case of more complex alliances characterized by a greater number of joint activities,the existence of equity cross-holdings and the need for cross-functional coordination.

Quiz 6: Engaging in Cross-Border Collaboration: Managing across Corporate Boundaries