International Strategic Alliance: Benefits and Challenges

Individual Academic Report

Table of contents
Executive summary.........................................................................................................................3
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
Literature review..........................................................................................................................3
Motivations behind the formation of International strategic alliance..........................................7
Benefits and challenges of the international strategic alliance....................................................8
Alternative market entry strategy................................................................................................9
CONCLUSION..............................................................................................................................10
REFRENCES.................................................................................................................................11

Executive summary
Strategic alliance refers to an agreement between two organisations so that they can generate
more revenue and it will help in building good reputation in market. The main aim behind
strategic alliance is to make good quality products and provide better services to customers so
that their needs can be satisfied. It is important to make strategic alliance so that companies can
use technology of each other and less investment is required. In report, literature review is
discussed which includes use of strategic alliance in foreign market expansion and how it is
beneficial for growth of company. Strategic alliance helps in development of an organisation so
that more revenue can be generated and it will be beneficial for a company. Motive behind
formation of strategic alliance is described in report and how it is useful in making plans for
future growth of an organisation. Further, benefits and challenges of strategic alliance to partners
has been described. It includes problems or issues which is faced by managers while expansion
in international market. Recommendations are provided for better market entry in international
market so that more people can be attracted and goals can be achieved.

INTRODUCTION
The term international strategic alliance referred to as the arrangement that is
collaborative between the companies that are headquartered in different countries. The strategic
alliance is formed between the local companies and international companies. The report consist
of the airline alliance of the Sky Team that is initially formed by four carrier members and
expanded to have nineteen carrier members. The report consists of the critical review for the use
of international strategic alliance in the foreign market expansion. The report demonstrates the
motivation for the formation of the Sky Team. The benefits and challenges faced by the
international airline alliance are discussed critically. The modes of the market entry for the
airline alliance are discussed.
MAIN BODY
Literature review
Strategic alliance means agreement between two companies who want to come together so
that they can expand their business and generate more profit. It is important to make plans or
strategies for growth of company and it will help in expanding business in international market.
It is not easy for managers to manage all activities and there are different rules and regulations
which vary from country to country. It is responsibility of managers to identify market situation
and according to that plans should be made so that more revenue can be generated.
According to (Baum and Auerbach, 2017), expanding business in international market is
useful because it helps in increasing profit and builds good reputation in market. It is important
to expand business with help of international strategic alliance. When a company want to grow
its business in other countries then they take help of other companies in international market and
make contracts to work together. It will help in earning more revenue and they can attract more
customers. It is important for an organization to make plans or strategies so that better plans can
be made and they can get benefit of it. Expanding business is not easy because in different
countries it is difficult to sell products and attract customers. So, managers of company should
identify choice of people and a cording to that product should be made so that more customers
can be attracted. Strategic alliance helps both partners in expansion of business in international
market.
As per the view of (Chuang and et.al., 2018), many organizations use strategic alliance to
capture wide area and attract more customers. At a certain point of time managers want to