By J. C. Jarillo (Auth.)
Strategic Networks examines the hot type of business co-ordination which allows self sustaining businesses to paintings so heavily jointly that they could occasionally current a 'single face' to the surface world.
Co-ordination isn't really completed by means of mergers and acquisitions, yet in the course of the production of a 'strategic community' of businesses practicing a similar ambitions. in accordance with the author's wide examine, the booklet first analyses the commercial arguments for
industry co-ordination, and indicates within which industries it truly is probably to ensue. the second one a part of the booklet specializes in * managerial implications for this sort of association * impression on responsibilties * keep an eye on with no possession * co-operation
instead of festival * the best way to arrange alliances and the way to keep up them a variety of foreign examples and instances are featured within the publication. J. Carlos Jarillo is Professor of approach on the collage of Geneva (previously Professor of General
Management and foreign technique at IMD, Switzerland). His examine on technique has been commonly released in additional than dozen articles and books. He additionally acts as senior adviser to quite a few overseas corporations.
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Additional resources for Strategic Networks. Creating the Borderless Organization
Example text
Or better still, he could give up part of the already inflated margin (more than double the original margin) and sell to the public at only £65. By doing this, besides earning £30 per metre of material sold, he might attract more customers by selling cheaply, which would mean that he could manufacture more and maybe increase profits there too. The logic behind this exercise seems flawless. Money is made at the factory stage, because sales are good, and money is made at the retail stage too. The middleman has been profitably cut.
Why then the insistence in looking at the whole industry at the same time? The reason is that, if it is true that the profits companies operating in different activities make are a result of the profits made in each of the activities, there is another source of profits. The coordination of the different activities that end up producing the final product or service is also a costly, value-adding activity, and it can be performed in a more or less efficient (and defensible way), since the flow of goods along the industry system implies costs: in transportation, intermediate stocks, the need to adapt designs to different customers, the passage of information about pricing, technical characteristics, market evolution, etc.
See, for instance, Xavier Gilbert and Paul Strebel, 'Developing Competitive Advantage', in H. ), The 44 Understanding the playing field: the business system 8 9 10 11 Strategy Process, Englewood Cliffs, New Jersey: PrenticeHall, 1987. There have been makers of IBM mainframe-compatible machines, but they have always had to pay a big penalty in terms of costs, for they had to wait for IBM to introduce models, with huge technical difficulty, to reverse-engineer them. For this reason, they never constituted a real threat to IBM.