A Study On Corporate Strategic Alliance

Corporate strategic alliance as a new organization of modern companies is considered by many contemporary economists as the most speedy and economical method for global strategy. This organization shatters the doctrine that there are only opposing competitions between companies, and provides a new perspective and model for companies to handle their relationships with their rivals. Corporate strategic alliance has been growing at the rate of over 25% annually since the 1990s.The circles of economics and management have paid much attention to the advent of global strategic alliance,and accordingly a number of theories have come into being, such as the transaction cost theory,the value chain theory,the social network theory and the corporate ecosystem theory. These theories approach corporate strategic alliance as a complex industrial organization from a variety of angles and strata. Nevertheless,there are some obvious limitations in them. They approach the new way of organization from a dynamic or static perspective,without combining both perspectives; They also neglect the fact that the discrepancies in capability between companies result in corporate strategic alliance. Consequently, these theories fail to give a convincing account of such phenomena as the fast growth of corporate knowledge alliance. Admittedly, the existing research needs to be expanded and enriched through an examination of practice.The corporate capability theory is formulated by critiquing the analysis framework of structure-behavior-performance,advocated in the traditional corporate theory and the industrial organization theory,as well as the mainstream contemporary strategic management theories. This theory holds that corporate capability is the starting point for the analysis of companies to the effect that companies are a set of capabilities in nature, corporate capabilities determine the operation size and scope involved,companies are heterogeneous due to their discrepancies in capabilities,and the long-term corporate advantage stems from corporate capabilities,in particular,core capabilities. These assumptions challenge the ideal claim made by classical and neoclassical economists that companies are omnipotent, and presents a picture of limited corporate capabilities. Hence,this theory attempts to discover the nature and competitive advantage of companies. It can be regarded as an extension of the theories concerned in economics and management, serving as a new tool for analyzing corporate strategic alliance.This dissertation holds that the perspective of corporate capabilities enables us to better understand the inherent mechanism for the formation of corporate strategic alliance. The division of labor between modern companies results in the inadequate systems of corporate capabilities, which in turn lead to the failure of matching practical capabilities with objectives. Corporate strategic alliance is a more speedy and efficient way for improving corporate performance than self-accumulation,acquisition and purchase. Features such as the heterogeneity and irreplicability of corporate core capabilities entail mutual learning and inter-complementation. By means of corporate strategic alliance,corporate core capabilities are integrated so that their advantages are promoted whereas their disadvantages are overcome. In this way,companies can improve their capabilities,find new markets,and undertake new businesses. Judged in this sense,corporate strategic alliance is conducive to the reduction of the rigid inclination of corporate core capabilities as well as the cultivation of the dynamic corporate capabilities.Corporates with different capabilities form strategic alliance for the competitive advantage. Once corporate strategic alliance is formed, the individual capabilities and competitive advantage will be integrated with the overall counterpart. The individual capabilities are a foundation for the overall and individual competitive advantages; the overall competitive advantage strengthens the individual capabilities and promotes the individual competitive advantage; The individual competitive advantage reinforces the overall counterpart. As a result , corporate strategic alliance contributes to the improvement of the individual competitive advantage as well as the materialization of the overall"take-off effects". The advantages of such an alliance lie in the realization of economic effects in size and scope,the improvement of learning effects and the replication of success.Corporate strategic alliance based on capabilities does not hinder competitions; instead,it intensifies competitions,optimizes the allocations of social resources and improves social welfare. Thus,corporate strategic alliance should be encouraged in China.