Home / Questions / Alliances permit firms to sequentially increase their investment should they decide to pur
Alliances permit firms to sequentially increase their investment should they decide to pursue acquisitions.
22.During the first stage of alliance formation, a firm decides whether growth can be achieved strictly through market transactions, acquisitions, or alliances.
23.In the context of alliance formation, shared capabilities is one of the driving forces in deciding whether to take a contract or an equity approach.
24.Importance of direct organizational monitoring and control is low in equity-based alliances.
25.The degree of tacitness is low in non-equity-based alliances.
26.Influence of formal institutions is low in both equity- and non-equity-based alliances.
27.The more hard to describe the capabilities of a firm in an alliance, the greater the preference for an equity involvement.
28.Equity alliance relationships tend to have less direct control over joint activities on a continual basis than contractual relationships.
29.One way of combating opportunism in an alliance is to wall off critical capabilities.
30.The alliance dissolution is a four-step process.
31.The first phase in an alliance dissolution is mediation by third parties.
32.Equity, learning and experience, relational capabilities, and nationality are four factors that may influence alliance performance.
33.The three potential motives for alliances are synergistic, hubristic, and managerial motives.
34.In the context of acquisitions, synergistic motives destroy value while hubris and managerial motives add value.
35.Alliances preclude acquisitions.
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