Business Strategy Report: Strategic Alliance and Performance

This report analyzes three articles related to business strategy. The first article, "Rethinking and reinventing Michael Porter’s five forces model," discusses the importance of Porter's model in strategic management, emphasizing the five competitive forces and their systemic interdependencies. The second article, "Linking Individual Performance to Business Strategy: The People Process Model," explores the connection between business strategy and individual performance through the 'people process model,' highlighting the significance of vertical and horizontal linkages in human resource management. The third article, "Development of an Integrated Model of Strategic Alliance," focuses on strategic alliances as a key element in strategic management, discussing environmental conditions, resource-based view, dynamic capabilities, and transaction cost economics. The report emphasizes the importance of strategic alliances, competitive forces, and the integration of individual performance with business strategy for organizational success.

Running head: BUSINESS STRATEGY
Business Strategy
Name of the student
Name of the University
Author note

1BUSINESS STRATEGY
The article, “Rethinking and reinventing Michael Porter’s five forces model” talks
about the fact that the model of the competitive forces propelled the aspect of the strategic
management. The article brings out the genius of Michael Porter who distilled complex
micro-economic literature into the five causal variables: bargaining power of buyers, entry
barriers, rivalry, substitutes and bargaining power of suppliers. The article talks about the
value of the Porter’s model that was able to simplify the micro-economic theory into the five
important influences. The article states how the Porter’s value chain emphasized significance
of the negotiating power along with the bargaining arrangements that helped in the
determination of relative market attractiveness (Grundy 2006). The article discusses that there
exists a gap in between PEST and that of SWOT analysis which can be met with the help of
the five forces of Porter. The article states how hig-growth environment can help in
encouraging the entrants whereas a low growth environment discourages the entry of the
companies. According to Grundy (2006), five competitive forces of Porter can be said to be
highly independent with that of the other sub-systems within external environment. The
article discusses about the fact that Porter’s five forces should be understood in the form of a
wider system instead of self-contained unit. The original concept of Porter helps in explaining
the system interdependencies however it can be said that it is underdeveloped. The article has
discussed how the entry barriers in the center causes the buyers to reduce the entry barriers.
The article has talked about the fact that the five forces contain sub-ingredients that should be
explored. The article throws light on the aspect of competitive rivalry that talks about the
number of the players within the market along with their strategy. The number of the
competitors is indicative of sheer quantity of the players within market. The five competitive
forces of Porter can be said to be a static model that diminishes the aspect of the usefulness
however it can easily be provided with dynamic perspective. The competitive dynamics can
easily be understood both at macro and at the micro level. It can be said that at macro level,

2BUSINESS STRATEGY
these will have a great effect on industry cycle. In the event of an industry reaching the
maturity, the entry barriers can be said to increase along with the bargaining power of buyers.
The value of article lies in the fact that it helps in the examination of the systemic
interdependencies.
The article, “Linking Individual Performance to Business Strategy: The People
Process Model” talks about the fact that the organizations delivers the competitive advantage
in the short term and it prepares for the long-term success. The article states that there is a
link in between business strategy and the individual performance that takes place in the event
of the organizational capability embedding the people processes. Strength of linkage in
between the people process and that of business strategies can be said to vary across the
various processes. The models pertaining the human resource strategy comprises of vertical
linkage in between the strategy and the individual behaviour (Gratton et al. 1999). The
horizontal linkage in between the processes plays a crucial role as it ensures that the key
people processes have the cohesion along with the coherence. According to Gratton et al.
(1999), cohesion plays a significant role in the creation of synergistic benefits and it helps in
the successful implementation of the strategic plans of an organization. The article states that
vertical along with the horizontal linkage cannot capture dynamic nature of the lineage. The
word of “process” can help in talking about the philosophies, policies along with the practices
of an organization. The processes should be able to support policies of a company that can
help in the delivering of the short-term performance. It can help in preparing the foundation
for that of long-term transformation. The business objectives pertaining to the strategic plan
should be articulated to an individual. It should then be transformed into the clear objectives
that should be agreed on the annual or that of the bi-annual basis. The article discusses that
training focussing on business needs in the short term is an important aspect that helps in the
creation of a flexible along with a multi-skilled workforce. The maximising of the

3BUSINESS STRATEGY
performance of the knowledge workers can help in the building of a learning organization.
The organization should encourage the development of the new skills that can help in the
development of an organization. There should be processes that can help in supporting the
leadership cadre that should be the central activity of the companies. In the event of the
companies moving outside of national boundaries, people processes should be embedded to
the strategy. The article talks about the fact that in the companies in which the processes has
been continuing for many years the processes becomes better embedded within the system.
The article, “Development of an Integrated Model of Strategic Alliance”, talks about
the fact that the strategic alliances have become the central perspective in relation to the
strategic management of the firms. Strategic alliances has become the dominant manner of
the thinking within the strategic management theory and the practice. The firms can succeed
in the market with the help of the element of collaboration (Bhattacharyya 2019).
Collaboration can help in the creation of value for the firms across the various geographies
and the industries. The environmental conditions of a firm can act as a decisive factor that
can help in the determination of the competitive success or the failure of the firm. The article
states that industry environment consists of the three dimensions of the contest: bargaining
power, threat of the entry and the rivalry in between the competitive firms. The article
discusses that a firm forming an alliance with that of another firm can help in sustaining the
competitive advantage in the market. Resource based view can be stated to be an important
perspective that have gained popular in that of last few decades. According to Bhattacharyya
(2019), the resources of the firm along with the capability differences can help in reflecting
on differential attainment of the competitive advantage at that of inter-firm level. The
difference in the inter-firm performance can be understood with the help of the differential
resources along with the capabilities. The strategic alliances being formed in the company
can help in the enhancing of the specialized technology in relation to robotics along with the

4BUSINESS STRATEGY
3D printing. The article discusses that dynamic capabilities acts as an important frame that
helps in analysing potency in relation to the strategic alliance partners. The article talks about
the significance of Transaction Cost Economics (TCS) and the theorists in relation to TCS
talks about the fact that all the activities in a firm have the aspect of the cost dimension.
Proponents of TCE state that organizational activities having the costs that are higher than the
incurred benefits should be outsourced. The firm activities that have higher value of the
benefits as compared to the costs should keep within boundary of a firm. The article talks
about the agency theory that helps in deliberating on the behaviour of the managers along
with the owners. The managers from that of partnering firm should look for the benefits that
is suited for the parent firms instead of bringing benefits to the partnership.

5BUSINESS STRATEGY
References
Bhattacharyya, S.S., 2019. Development of an Integrated Model of Strategic Alliance. Indian
Journal of Industrial Relations, 54(3).
Gratton, L., Hope‐Hailey, V., Stiles, P. and Truss, C., 1999. Linking individual performance
to business strategy: The people process model. Human Resource Management: Published in
Cooperation with the School of Business Administration, The University of Michigan and in
alliance with the Society of Human Resources Management, 38(1), pp.17-31.
Grundy, T., 2006. Rethinking and reinventing Michael Porter's five forces model. Strategic
Change, 15(5), pp.213-229.