This website uses cookies to ensure you have the best experience. Learn more

Internal Business Partnership Essay

3102 words - 13 pages

Question: -For what reasons might MNEs cooperate with each other? What barriers are there to successful cooperation?'In a complex, uncertain world filled with dangerous opponents, it is best not to go it alone', (Ohmae, 1989). As globalisation leads the world forward, national boundaries diminish and competition increases from less industrialised nations it becomes more and more difficult for firms to maintain their market shares. To define competencies, and to exploit the advantages from combined knowledge is one of many drivers for cooperation between firms.Firms co-operate in many ways, such as licensing, franchises, turnkey projects, joint ventures, strategic alliances and equity ...view middle of the document...

Building apon this, Horaguchi and Toyne (1990) state 'the strategy to form an alliance is not just reactive, it is also proactive in that it creates new products, new markets, new organisations, new management techniques, and new technology', (Horaguchi & Toyne, 1990: 491). On the other hand Harrigan (1985) takes a broad view of the motives of strategic alliance formation, where internal benefits, competitive benefits and strategic benefits are all grouped together.Porter (1986) in comparison, states that the formation of a strategic alliance depends on the five forces; the threat of new entrants, the bargaining power of suppliers, the bargaining power of buyers, the threat of substitutes, and rivalry amongst firms. Thus, firms may form collaborations and agreements if any of the five forces push against the firm. Porter (1985) also links the five forces with the three generic strategies; cost leadership, product differentiation and focus. Kogut (1988) mentions that alliances are formed under the competitive strategies approach as a defensive mechanism in order to hedge against strategic uncertainty (Kogut, 1988). These theories provide us with reasons why firms may collaborate together, we must now put this into practice and consider the methods used by multinational enterprises.Daniels & Radebaugh (2001) outline the reasons why firms may co-operate with each other, these motives shall all be discussed using examples with maintaining the focus of the multinational enterprise.To begin with, MNE's may cooperate together to benefit from spreading their costs or reducing their costs. For example contracting out tasks that take place in a firm can be more economically feasible then the firm actually undertaking the task in-house. This is because the sub-contractor may have excess capacity and therefore maybe able to produce the goods cheaper as the fixed overheads have already been met which creates a lower average cost (Daniels & Radebaugh, 2001). Initiation time could also be faster for the contracted firm, allowing them to produce the finished product sooner. An important limitation of this form of cooperation is that negotiating, transfer of technology, systems and maintenance of business relations can be expensive to the firm in the longer term. Considering this, many MNE firms cooperate at this level, such as that of General Motors receiving many part or fully made products from other multinational firms (Hill, 2000).A second form of cooperation between MNE's is that of specialising in competencies. A Company will focus on the advantageous resources that will best meet the competencies at any particular point in time, but MNE's continuously review their strengths and targets. This generates or brings forward those advantages that the firm decides not to purse, these are then licensed or collaborated with other firms to follow-through for the MNE. An example of this is where Coca-Cola licences its brand name to another firm to...

Other Essays Like Internal Business - Partnership

Types of Corporations Essay

2308 words - 10 pages assistance of lawyers and accountants in order to maintain compliance with corporate law. S-Corporation: Named after sub chapter S of chapter one of the Internal Revenue Code an S-Corporation is a business form much like a closely held corporation with similarities of partnership. An S-Corporation is considered a pass through organization in that there is no federal income tax imposed and profits and losses are “passed through” and shown as personal

Ac553 Week 6 Essay

628 words - 3 pages partnership must use the same tax year as its principal partners. A partnership may adopt a fiscal tax year if it can establish to the satisfaction of the Internal Revenue Service that it has a business purpose for using a fiscal tax year. 21 - 26. Durrabusiness is organized as a regular C corporation in 1986. At the beginning of the present year, Durrabusiness elects to

Partnership Tax

797 words - 4 pages partnership, is in the business of leasing trucks, and is managed by Mr. Radish, who also owns and manages a profitable restaurant business. Recently the truck leasing business has encountered economic problems and is expected to incur substantial losses this year. It also appears that next year the leasing operation will turn a substantial profit. III CONCLUSIONS 1. Yes. LLC’s and S Corporations are flow-through entities, therefore, all

Creating, Financing, and Marketing a Business

1789 words - 8 pages CREATING, FINANCING, AND MARKETING A BUSINESS LEONA PARKS PROFESSOR MARILYN FITZPATRICK BUSINESS 100 FEBRUARY 24, 2012 Leona Parks Professor Marilyn Fitzpatrick Business 100 February 24, 2012 Creating, Financing, and Marketing a Business Identify the pros and cons of the partnership as a form of ownership. The simplicity and flexibility in creating a partnership may be one of the main advantages of the partnership as a form of

Small Business

1173 words - 5 pages Webb Inc. must choose form to start the process of forming her business. The legal entity in which a business owner can choose from is sole proprietorship, partnership, C corporation, and S corporation. Along, with the advantages and disadvantages of each type of business form. Sole proprietorship is the most common form utilized for a small business. This type of form is used, especially in the early stages of a business controlled by one person

Small Business Idea

1380 words - 6 pages the owner of the small business to understand the consequences of legal, tax, and accounting issues related to the type of business form they choose. The goal of this analysis is to illuminate possible advantages and disadvantages related to four distinct forms of business organization. These include sole proprietorship, partnership, C-corporation, and S-corporation. The examination will include the diverse types of financial statements connected

Small Business Idea Paper

1287 words - 6 pages the company ("GPS Sports", 2011). Business Forms, Advantages and Disadvantages The government has available funding to assist GPS Sports in developing the organization. GPS must first identify the specific form of business selection that will best suit the company for the products and services. There are four general form of business, which are Sole Proprietorship, Partnership, Limited Liability Corporation, and Corporations (Fay, 2008). Sole

Business Wikipedia

2875 words - 12 pages ------------------------------------------------- Business article Business article Business From Wikipedia, the free encyclopedia For other uses, see Business (disambiguation). "Firm" redirects here. For other uses, see The Firm. Companies law | * Company * Business | Business entities | * Sole proprietorship * Partnership * Corporation * Cooperative | European Union / EEA | * EEIG * SCE * SE * SPE | UK

Situation Analysis

1859 words - 8 pages strategies on a corporate level; so as to see to the attainment of the company goals. Such strategies are given below with specific Forward Integration: - this strategy by proton involves its ownership of the providing end of the business or increased alliances. It is attainable through vendorship or distributorship arrangements, partnership or controlled alliance with dealers within or without the country. Backward Integration: - ownership of

Operation Strategy - Mcdonald

2685 words - 11 pages /control systems Capabilities: Unique to each firm Competitive priorities: Cost Quality High-performance design Consistent quality Time Fast delivery time On-time delivery Development speed Flexibility Customization Volume flexibility Criteria for Evaluating an Operations Strategy Consistency (internal and external) Between the operations strategy and the overall business strategy

Business Law and Ethics

1089 words - 5 pages Business Entities, Laws, and Regulations Paper BUS/415 Business Entities, Laws, and Regulations Paper Businesses can range from the small mom and pop shops to worldwide corporations. Either way when establishing a business a decision will need to be made regarding the type of entity to use; sole proprietorship, general partnership, limited partnership, limited liability company (LLC), limited liability partnership (LLP), franchise, or

Related Papers

Business Structures Essay

965 words - 4 pages the daily operations of the business. Corporations are very involved to create. Articles of Incorporation and Bylaws are required. Corporations must obtain an Employee Identification Number from the IRS and provide it to the bank to set up a business account. Corporations have various State and federal filings that are required. Corporations must have at least one shareholder. General Partnership In a General Partnership, all of the partners

Legal Forms Of Business Essay

949 words - 4 pages Legal Forms of Business LAW/531 BUSINESS LAW When starting a business, the legal structure for the business must be chosen. It is necessary to understand how each legal structure works in order to make an informed decision. Many types of business structures are available, such as Sole Proprietorship, General Partnership, Limited Partnership, Limited Liability Company (LLC), to name a few. Although this may not be the first thing on the

Human Resourse Essay

804 words - 4 pages limited to their investment in the business venture (Emerson, 2013). Therefore, general partners Lou and Jose will be liable to satisfy business debts and liabilities. Partnership business doesn’t pay tax. Form 1065 is filed with the Internal Revenue Service and Schedule K for each partner outlining the shares of the partnership income and loss. This means that each of the three partners will have the obligation for filing profits or losses on his

Types Of Ownership Essay

1102 words - 5 pages deductible from business income on tax returns. * The partnership may have a limited life; it may end upon the withdrawal or death of a partner. Types of Partnerships that should be considered: 1.        General Partnership Partners divide responsibility for management and liability as well as the shares of profit or loss according to their internal agreement. Equal shares are assumed unless there is a written agreement that states