strategic alliance

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1. Discuss what the following statement means: 'It can take years for a buyer/seller partnership to begin delivering results.'
It can take a long time for buyer/seller partnership to begin delivering results. The reason is that the supplier must get involved in day-to-day redesign support, process improvement and early supplier involvement. These actions of the supplier take a large deal of investment. The supplier must perceive value for himself if he decides to proceed. This whole process takes a long time. It is a process of trust formation and capital investment. in case of Whirlpool/Inland partnership, the first steps were taken by the two companies in 1984 but the relationship solidified in 1993. the process is gradual, as trust and confidence improve there is a closer alliance between the two. Usually, when joint cost-reduction projects are undertaken the benefits follow.
2. Discuss the advantages of having point-to-point contact (Exhibit 1) between functional groups at different companies. Are there any disadvantages to this approach?
The advantages of point-to-point contract between the functional groups at different companies have several advantages. There is closer coordination, improved communication and greater sensitivity to the needs of the other company. For instance, manufacturing to manufacturing contact can make production planning easy, timely and accurate. Similarly, contact among accounting personnel can make forecasting of demand easy. Lets take another example, engineering to engineering contact can improve design.
There are disadvantages to this also. Differences in culture can lead to conflict. Confidential cost related data may be leaked to competitors. Close contact between two partners can mean the person loses touch with the market. Finally, unless the technologies of the two companies have been ...