Many multinationals, in response to globalization, are increasingly engaging in international business beyond their home country's borders to gain and maintain competitive advantages over competitors. This entry into the international market is facilitated by foreign companies working together in joint venture relationships called Global Strategic Alliances (GSAs). GSAs are formed by companies to acquire new technology, gain access to specific markets, reduce financial risks, reduce political risks, to secure or gain competitive advantages (Wheelen and Hungar, 2000 cited by Elmuti and Kathawala, 2001). Shenkar and Luo, (2008, pp.332) stated that “global strategic alliances are cross-border partnerships between two or more companies from different countries with an attempt to pursue mutual interests through sharing their resources and capabilities”. Global strategic alliances have not always lived up to the initiators' expectations. 60% of strategic alliances fail (Kalmbach and Roussel, 1999 cited by Elmuti and Kathawala, 2001). Certain factors have been implicated in making global strategic alliances prone to failure. Parkhe (2001) listed these factors as social cultures, national context, corporate culture, strategic directions, management and organization practices. GSAs are made up of two or more companies of different nationalities, backgrounds and cultures. These multiple interorganizational relationships create challenges that impact the longevity of alliances. Cultural differences such as languages, attitudinal behaviors, social norms, and corporate business ethics could be so divergent and incongruous that they lead to the failure of GSAs. Parkhe (2001) however argued that these negative tendencies have little chance of survival. Feasibility studies and research on principles and methods of cooperation must be conducted by managers before implementing the formation of GSAs. Coordination between management teams must be encouraged to avoid a situation where partners could still pursue their different business interests, which would fuel competition between alliance partners. Reference:1. Elmuti, D. and Kathawala, Y., (2001), An Overview of Strategic Alliances, Management Decision, Volume 39, No. 3, pp. 205 – 217.2. Shenkar, O. and Luo, Y., (2008), International Business, 2nd edition, Thousand Oaks, CA: Sage Publications, ch. 12, pp. 331-337.3. Parkhe, A., (1991), Interfirm Diversity, Organizational Learning, and Longevity in Global Strategic Alliances, Journal of International Business Studies, Fourth Quarter, pp. 579 – 601
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