GROUP 8: COOPERATIVE STRATEGY

Legend:

VIOLET italic bold font and are parenthesized are reporter’s que what to explain

and elaborate.

COOPERATIVE STRATEGY
Cooperative Strategy

- is a means that firms collaborate to achieve a share objective. (EXPLAIN

FURTHER BY THE REPORTER)

- In using cooperative strategy, competitive advantages were DEVELOPED, and

often called as collaborative or rational advantage,

 Strategic Alliance as Primary type of Cooperative Strategy.

Strategic Alliance

- Is a cooperative strategt in which firms all combine some of their resources

to create a competitive advantage. (EXPLAIN FURTHER BY THE

REPORTER)

*TYPES OF STRATEGIC ALLIANCES* (EXPLAIN BRIEFLY LANG)

1. Joint Venture – is a type of strategic alliances in which two (2) or more firms

makes or establish a legally independent company to share some of their

resources to create a competitive advantage.

2. Equity Strategic Alliance – in which two (2) or more firms owns a different

percentages of a company that they have formed by combining some of their

resources to create a competitive advantage,

 3. Nonequity Strategic Alliance - in which two (2) or more firms develops a

contractual relationship to share some of their resources to create a

competitive advantage.

- REASONS firms develop STRATEGIC ALLIANCES (EXPLAIN

FURTHER BY THE REPORTER)

1. Creates Value they couldn’t generate by acting independently and

entering markets more rapidly.

2. Most (if not all) companies lack the full set of resources needed to

pursue all identified opportunities and reach their objectives in the

process of doing so on their own.

(DUE TO THE REASONS, WE WILL DISCUSS THE TYPE OF MARKETS)

(EXPLAIN BRIEFLY LANG, PROVIDE BA MO RON OG EXAMPLES PARA SAYON

NINYO MA DISCUSS)

A. Slow- Cycle Markets

- a market with low trading volumes and/or low volatility, or a market in which trade

orders are not being filled as fast as possible.

B. Fast- Cycle Markets

- Are unstable, unpredictable, and complex, for short it is HYPERCOMPETITIVE.

In a sense that the market conditions where prices are trending quickly.

C. Standard- Cycle Markets

- Alliances are more likely to be made by partners that have a complimentary

resources.

BUSINESS- LEVEL COOPERATIVE

STRATEGY

- Business- Level Cooperative Strategy (EXPLAIN FURTHER BY THE

REPORTER)
 - is a strategy in which firms combine some of their resources to create a

competitive advantage by competing in one or more product markets.

(EXPLAIN BRIEFLY LANG, PROVIDE BA MO RON OG EXAMPLES PARA SAYON

NINYO MA DISCUSS)

 Complementary Strategic Alliances

- are business-level alliances in which firms share some of their resources in

complimentary ways to create a competitive advantages.

 Vertical Complementary Strategic Alliances

- In this alliance, firms share some of their resources from different stages of the

value chain to create a competitive advantage.

 Horizontal Complementary Strategic Alliances

- firms share some of their resources from the same stage (or stages) of the value

chain for creating a competitive advantage.

 Competition Response Strategy

(EXPLAIN FURTHER BY THE REPORTER)

 Uncertainty- Reducing Strategy

(EXPLAIN FURTHER BY THE REPORTER)

 Competition- Reducing Strategy

(EXPLAIN FURTHER BY THE REPORTER)

- Explicit collusions exists when two (2) or more firms negotiate directly to jointly

agree about the amount to produce as well as the prices for what is produced.

- Tacit collusions exists when several firms in an industry indirectly coordinates

their production and pricing and pricing decisions by observing each other’s

competitive actions responses.

Mutual Forbearance – a form of tacit collusion in which firms do not

take competitive actions against rivals they meet in multiple market and industries.

 Assessing Business- Level Strategies

 (EXPLAIN FURTHER BY THE REPORTER)

CORPORATE- LEVEL COOPERATIVE

STRATEGY
Corporate- Level Cooperative Strategy

- A strategy in through which firms collaborates with one of more business

organizations to expand its operations. (EXPLAIN FURTHER BY THE

REPORTER)

(EXPLAIN BRIEFLY LANG, PROVIDE BA MO RON OG EXAMPLES PARA SAYON

NINYO MA DISCUSS)

 Diversifying Strategic Alliance

- Firms share some of their resources to engage in product and/or geographic

diversification.

 Synergistic Strategic Alliance

- Firms share some of their resources to create economies of scopes.

 Franchising

- In which a firm (franchisor) uses a franchise as a contractual relationship to

describe and control the sharing of its resources with its partners (franchisees).

 Assessing Corporate- Level Strategies

- Commonly are broader in scope and more complex, making this strategy more

challenging and costly to utilize.

INTERNATIONAL COOPERATIVE STRATEGY

International Cooperative Strategy
 It is a cooperative strategy in which a firm located in one country cooperates

with a firm located in a different country. (EXPLAIN FURTHER BY THE

REPORTER)

 Cross-Border Strategic Alliance

A strategy in which firms with headquarters in different countries decides to

combine some of their resources to create a competitive advantage. (EXPLAIN

FURTHER BY THE REPORTER)

NETWORK COOPERATIVE STRATEGY

Network Cooperative Strategy

- It is a strategy that several firms agree to form a multiple partnerships to achieve

shared objectives.

 Alliance Network

- Set of strategic alliance partnerships that firms develop when using a network
cooperative strategy.

 Stable Alliance Network

- Formed in mature industries where the demand is relatively constant and

predictable.

 Dynamic Alliance Network

- Used in the industries that are characterized by frequent product innovations and

short product life cycle.

COMPETITIVE RISKS WITH COOPERATIVE

STRATEGIES
 (VanVan ang ibutang sa ppt ani nga part kay kanang naa sa

figure 9.5 page 299)

(ELABORATE & EXPLAIN THIS PART)

MANAGING COOPERATIVE STRATEGIES

 (ELABORATE & EXPLAIN THIS PART)

Cost Minimization Approach

- Firm develops formal contracts with partners. In this contract, it specify how the

cooperative strategies is to be monitored and how a partner behavior is

controlled.

- GOAL: The goal is to minimize the cooperative strategy’s cost and to

prevent opportunistic behavior by partner.

Opportunity Maximization Approach

- Maximizing a partnership’s value creating opportunities is the focus and the goal

of this approach.

- In this approach, partners are prepared to take advantage of unexpected

opportunities to learn from each other and to explore additional market

possibilities.