Assessing Strategic Alliances in Bad Times: The Case of General Motors—Fiat
- First Online: 24 November 2012
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- Francesco Baldi 2
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Case study 1 illustrates how to apply our proposed real options framework to value and choose the right strategy to exit strategic alliances. More specifically, the case study presented here on the joint-venture agreement signed between General Motors and Fiat in 2000 and abruptly terminated in 2005 discusses and reveals the value-added use of option clauses in the design of strategic inter-firm collaborations.
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Cox J, Ross SA, Rubinstein M (1979) Option pricing: a simplified approach. J Financ Econ 7:229–263
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Trigeorgis L (1996) Real options. Managerial flexibility and strategy in resource allocation. MIT Press, Boston
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Department of Business and Management, LUISS Guido Carli University, Viale Romania 32, 00198, Rome, Italy
Francesco Baldi
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Baldi, F. (2013). Assessing Strategic Alliances in Bad Times: The Case of General Motors—Fiat. In: Options in Alliances. SpringerBriefs in Business. Springer, Milano. https://doi.org/10.1007/978-88-470-2850-0_7
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Published : 24 November 2012
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Our own research highlights six key points of vulner-ability for alliances which should be the focus for spe-cial attention by executives of corporations and man-agers of alliances. We illustrate these vulnerabilities through an in-depth case study of the failed strategic alliance between AB Volvo and Renault S.A.
This study explores the antecedents of alliance failure between incumbents and startups by shedding light on the ex ante conditions that initiated the alliances, the in situ conditions that caused the alliance failures, and the ex post conditions of the outcomes.
Special Issue (2019) NEGOTIATING INTERNATIONAL. STRATEGIC ALLIANCES: EXAMPLES OF SUCCESSES AND FAILURES; Guest Editors, Michael Jeive and Raymond Saner, European Journal of International Management. Volume 13, No. 5, 2019, pp 581-709. Publication.
Case study 1 illustrates how to apply our proposed real options framework to value and choose the right strategy to exit strategic alliances. More specifically, the case study presented here on the joint-venture agreement signed between General Motors and Fiat in 2000 and abruptly terminated in 2005 discusses and reveals the value-added use of ...
strategic alliance could actually increase your risk. Unfortunately, strategic alliances often fail. Nearly half of the respondents to a 2014 study on strategic alliances by the CMO Council and Business Performance Innovation Network reported strategic alliance failure rates of 60% or more.
The conceptual framework focuses on two primary sources of alliance failure: interfirm rivalry and managerial complexity. We propose that strategic alliances fail because of the opportunistic hazards as each partner tries to maximize its own individual interests instead of collaborative interests.
This thematic issue provides analysis of case examples of negotiation processes of strategic alliances. Negotiation theory is applied to concrete M&A as negotiations as well as to other forms of negotiations of strategic alliances, for instance between governments, between private sector companies and cross-sectoral alliance negotiations between
The case deals with the reasons why the alliance makes sense, and documents how the alliance degrades and eventually fails. It demonstrates how the different expectations of partners can affect the nature and tone of their relationship.
We identify six factors that undermined the Volvo–Renault alliance: misalignment of senior and operating managers, path dependence, alliance recontracting, leadership style, cultural differences, and time.
Against this background, the purpose of this research is to study 'failed' strategic alliances with a view to identifying and exploring the determinant factors that led to the failure...