Diversifying alliances Examples: So, ang kahalagahan ng synergistic alliance is to understand what the other

members view as synergistic. If any member misunderstands the other’s expectation of the alliance, it is likely to fall
apart. For example, if one member believes the other is only looking for revenue generation, when in reality their
objective is to keep the synergistic group open and growing, the synergistic alliance is not likely to survive.

--- Through synergistic alliances joint ecocomies of scope is created between firms which ecocomies of scope means
that the production of one good reduces the cost of producing another related good. This means that it is more cost
effective as they produce wide variety of goods and services which may streghthens their business that may produce
positive result

--- through this strategic alliance it creates synergy as they help each other in some functions in the industry which
seems to be other firms weakness. Aside from that it helps businesses to improve their sales as well as to improve
their production process which may yield for having an above average return

First we will define what does Diversifying alliances means so based on my research it is a corporate level
cooperative strategy in which firms share some of their resources and capabilities to diversify into new product or
market areas which through diversification it may lessen the potential risk that a firm may encounter.

Example: Honda Motor Company provides a good example of leveraging a core competency through related
diversification. Although Honda is best known for its cars and trucks, the company started out in the motorcycle
business. So, Through competing in this business, Honda developed a unique ability to build small and reliable
engines. When executives decided to diversify into the automobile industry, Honda was successful in part because it
leveraged this ability within its new business. Honda also applied its engine-building skills in the all-terrain vehicle,
lawn mower, and boat motor industries

---- through diversifying alliances it may helps the firm to have an expansion not just within the market areas that they
have but also with other market areas and as they build expansion development of new product will be possible on
their part as both firms share the portion of their assets and abilities which may field for a better sales without merging
or combining with their partner firm nor an acquisition as this strategy does not require these two.

---- while it is true that a firm must examine first the on where to invest to assure that they can gain from that certain
investment Diversifying alliances requires to have a prior test or examine if the future merger between partners will
yield on sale and see to it that it will avoid conflicts and assure that both of the firm will be benefited.

Synergistic alliances

Unlike diversifying alliances that combines capabilities and assets synergistic alliances is define as an agreement
between firms to work together and share their core strengths to improve each performance as compared on
individual performance. It helps the firm to improve their weaknesses and let this be a strength on their firm.

Mayroon tayong Advantages of Synergistic Strategic Alliance

- Adequate resources availability due to sharing

- Strengthening in weak sectors by learning from other firm

- Concentrating on competitive advantage and making higher margins

Disadvantages of Synergistic Strategic Alliance

- Risk of losing confidential data to alliance partner

- Absence of common administration leads to instability and lose in control

- Increase in competition after break up with alliance partner

Examples: So, ang kahalagahan ng synergistic alliance is to understand what the other members view as synergistic.
If any member misunderstands the other’s expectation of the alliance, it is likely to fall apart. For example, if one
member believes the other is only looking for revenue generation, when in reality their objective is to keep the
synergistic group open and growing, the synergistic alliance is not likely to survive.

--- Through synergistic alliances joint ecocomies of scope is created between firms which ecocomies of scope means
that the production of one good reduces the cost of producing another related good. This means that it is more cost
effective as they produce wide variety of goods and services which may streghthens their business that may produce
positive result

--- through this strategic alliance it creates synergy as they help each other in some functions in the industry which
seems to be other firms weakness. Aside from that it helps businesses to improve their sales as well as to improve
their production process which may yield for having an above average return