International Strategic Alliances in Airline Industry

Individual academic
report

Table of Contents
Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Demonstrate a critical review of the literature related to the use of international strategic
alliances in foreign market expansion.........................................................................................1
Demonstrate an understanding of the motivations behind the formation of the selected
International strategic alliance....................................................................................................2
A critical assessment of the benefits and challenges of the international strategic alliance
selected to the partners involved.................................................................................................3
Propose a suitable alternative market entry strategy in your recommendations.........................4
Analysis and discussion:.............................................................................................................4
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................9

INTRODUCTION
International business refers to the trade of goods, services, capital, technology and
knowledge for the better scale of the business transactions across the borders. It involves cross
borders transactions, between the two or more business about the goods and services they offer
in the international market. International businesses expose the market growth and provide new
market segment to the people who wants to expand their businesses in the national and
international market. This report includes information about strategic alliance; it is an agreement
between the two businesses that agrees to share resources to undertake specific benefits from the
project. This allows two businesses to work together for the common goal or objective of the
business. This helps business to make strategy that helps their business to achieve the specific
common target of the organizations so that effective growth can be achieve in most appropriate
manner. Below report is based on SkyTeam Airline alliance, it is one of the three major airline
alliance. It was founded in June 2000, Sky team was the three alliance that formed the first two
alliance was star alliance, and oneworld. The annual passenger count of airline is 630 million and
it is second largest of three major airlines. This includes information about international strategic
alliance and its importance in the business. Also importance of formulation of selected strategic
alliance, various benefits and challenges of international strategic alliance and analysis and
discussion about the literature review.
MAIN BODY
Demonstrate a critical review of the literature related to the use of international strategic
alliances in foreign market expansion.
As per the view point of Dan Li, 2020. International strategic alliance can be understand as a
agreement between two firms headquartered in different destinations. Partnership firs are legally
independent after their formation as an alliance. This provide them insight about the future
partnership they have to done in order to maximise the profit rate and customer segment.
International strategic alliance has been focused on the bilateral alliance. The study says that
international strategic alliance is formed between the two strategic alliance in which one
company is from local nation and other is form international market. it is based on the
involvement of the equity investment in the strategic alliance and that can provide the business
the equal level of investment equity. In international strategic alliance there are both equity based
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alliance and non-equity based alliance. Non equity based alliance also knows as the contract
based alliance. Equity based alliance generally knows as the international joint venture. Strategic
alliance in the international market provides the insight about the level of profitability and
growth of the business firm that increase the level of business’s strategic development in the
market. the intention of the strategic alliances is to become as corporative as possible. This
provide the development of the business strategy that helps to gain better profit and development
of both national and international market base. International strategic alliance is the strategy that
provides insight about the level of effective business growth and proficiency in the marketplace.
international strategic alliance ensure that they make effective strategic development so that
better growth and development of effective customer base can be provide. There are two aspects
of the international strategic alliance; one is motivation and partner selection and second is
ownership structure. The motivation behind the development of strategic development of
international alliance and second is to form the international market base that provide insight
about the effective strategic development to gain better objectives and growth of the business.
They works for the local market as well as international market base so that effective growth to
the business can be gained.
Demonstrate an understanding of the motivations behind the formation of the selected
International strategic alliance.
As per the view point of Tom Boon, 2020. Airlines is one of the most growing as a part of
passenger aviation industry. There are currently three big payers in the industry, these are
oneworld, star alliance, and sky team. they make huge impact on the mind set of their customers
and helps to increase the level of growth that could impact market development. in this alliance
is an agreement that provide airline pool resources, also it gives greater ability to work against
the competitors in the airlines industry. While the codeshare agreement of the airlines is works
outsides the airlines. The significant benefits of the airline to works in most appropriate manner
and increases in the share of the airlines in the international and local market. this gives the
rewards to its customers also by providing them the effective services they want in the airline
industry. Star airlines was the first airline from the big three airlines to be established. It was
founded in 1997 in Germany. Star airline says that its members includes world’s most significant
airlines and smaller relational airlines. It provides the easy connection to its connections to
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