We have spent more than five years studying the inner workings of 15 strategic alliances and monitoring scores of others. ![]() Alliances can provide shortcuts for Western companies racing to improve their production efficiency and quality control. Motorola needs Toshiba’s distribution capacity to break into the Japanese semiconductor market. ICL, the British computer company, could not have developed its current generation of mainframes without Fujitsu. It takes so much money to develop new products and to penetrate new markets that few companies can go it alone in every situation. Yet the case for collaboration is stronger than ever. Cooperation becomes a low-cost route for new competitors to gain technology and market access. In particular, alliances between Asian companies and Western rivals seem to work against the Western partner. A strategic alliance can strengthen both companies against outsiders even as it weakens one partner vis-à-vis the other. But the spread of what we call “competitive collaboration”-joint ventures, outsourcing agreements, product licensings, cooperative research-has triggered unease about the long-term consequences. General Motors and Toyota assemble automobiles, Siemens and Philips develop semiconductors, Canon supplies photocopiers to Kodak, France’s Thomson and Japan’s JVC manufacture videocassette recorders. Collaboration between competitors is in fashion.
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