SEVI 3013 Final Exam Questions and Answers Already Passed
Understand the Build-Borrow-Buy framework and be able to discuss its implications for
decisions on acquiring resources and capabilities - Answers a conceptual model that aids
strategic leaders in deciding whether to pursue internal development (build), enter a contractual
arrangement or strategic alliance (borrow), or acquire new resources, capabilities, and
competencies (buy)
Why did Lyft enter into strategic alliances with GM and Waymo? - Answers attempt to close the
gap w/ Uber
What were the benefits of these strategic alliances for Lyft? - Answers - competitive advantage
from Uber
- looking for cash/capital to get things done
What were the benefits of these strategic alliances for GM? - Answers - (equity alliance) allowed
the firm to tap into the 2nd largest mobile transportation network
- allowed to enter into the mobile transportations and logistics market
- equity investment also allowed to hedge against uncertainty
What were the benefits of these strategic alliances for Waymo? - Answers - participate to get
into a new industry
- new market of ridesharing
What are the benefits of strategic alliances (Borrow)? - Answers - flexible
What are the benefits of internal development (build)? - Answers - controllable in business
- less expensive
What are the benefits of mergers/acquisitions (Buy)? - Answers - overcoming barriers of entry
- pre-empt people from getting to business
What are the risks of internal strategic alliances (Borrow)? - Answers long negotiations and a
lack of commitment and trust
What are the risks of internal development (build)? - Answers time consuming and
overconfident w/ resources
What are the risks of mergers/acquisitions (Buy)? - Answers most costly, complex, and difficult
to reverse strategic option
What are strategic alliances? - Answers voluntary arrangement between firms that involves
, sharing of:
- knowledge
- resources
- capabilities
Why do firms enter into strategic alliances? - Answers - strengthen competitive position
- enter new markets
- hedge against certainty
- access critical complementary assets
- learn new capabilities
Non-equity alliance - Answers - partnership based on contracts
- supply agreements, distribution agreements, licensing agreements, franchise
Equity alliance - Answers - one partner takes partial equity stake in other (GM/Lyft)
Joint venture - Answers - standalone organization, created and jointly owned by 2 or more
parent companies (Hulu)
What is meant by co-opetition and the learning race, as they relate to strategic alliances? -
Answers - Co-opetition: cooperation by competitors to achieve a strategic objective
- Learning Race: situations where both partners in a strategic alliance are motivated to form an
alliance for learning, but the rate at which the firms learn may vary.
--example) Toyota & GM - alliance w/ competitor
whoever learned what they need to learn first, Toyota, dissolved the alliance and exited the race
What three components contribute to effective alliance management capability? - Answers 1.
Partner selection & alliance formation
2. Alliance design & governance
3. Post-formation alliance mgmt.
Mergers - Answers joining of 2 independent companies to form a combined entity
Understand the Build-Borrow-Buy framework and be able to discuss its implications for
decisions on acquiring resources and capabilities - Answers a conceptual model that aids
strategic leaders in deciding whether to pursue internal development (build), enter a contractual
arrangement or strategic alliance (borrow), or acquire new resources, capabilities, and
competencies (buy)
Why did Lyft enter into strategic alliances with GM and Waymo? - Answers attempt to close the
gap w/ Uber
What were the benefits of these strategic alliances for Lyft? - Answers - competitive advantage
from Uber
- looking for cash/capital to get things done
What were the benefits of these strategic alliances for GM? - Answers - (equity alliance) allowed
the firm to tap into the 2nd largest mobile transportation network
- allowed to enter into the mobile transportations and logistics market
- equity investment also allowed to hedge against uncertainty
What were the benefits of these strategic alliances for Waymo? - Answers - participate to get
into a new industry
- new market of ridesharing
What are the benefits of strategic alliances (Borrow)? - Answers - flexible
What are the benefits of internal development (build)? - Answers - controllable in business
- less expensive
What are the benefits of mergers/acquisitions (Buy)? - Answers - overcoming barriers of entry
- pre-empt people from getting to business
What are the risks of internal strategic alliances (Borrow)? - Answers long negotiations and a
lack of commitment and trust
What are the risks of internal development (build)? - Answers time consuming and
overconfident w/ resources
What are the risks of mergers/acquisitions (Buy)? - Answers most costly, complex, and difficult
to reverse strategic option
What are strategic alliances? - Answers voluntary arrangement between firms that involves
, sharing of:
- knowledge
- resources
- capabilities
Why do firms enter into strategic alliances? - Answers - strengthen competitive position
- enter new markets
- hedge against certainty
- access critical complementary assets
- learn new capabilities
Non-equity alliance - Answers - partnership based on contracts
- supply agreements, distribution agreements, licensing agreements, franchise
Equity alliance - Answers - one partner takes partial equity stake in other (GM/Lyft)
Joint venture - Answers - standalone organization, created and jointly owned by 2 or more
parent companies (Hulu)
What is meant by co-opetition and the learning race, as they relate to strategic alliances? -
Answers - Co-opetition: cooperation by competitors to achieve a strategic objective
- Learning Race: situations where both partners in a strategic alliance are motivated to form an
alliance for learning, but the rate at which the firms learn may vary.
--example) Toyota & GM - alliance w/ competitor
whoever learned what they need to learn first, Toyota, dissolved the alliance and exited the race
What three components contribute to effective alliance management capability? - Answers 1.
Partner selection & alliance formation
2. Alliance design & governance
3. Post-formation alliance mgmt.
Mergers - Answers joining of 2 independent companies to form a combined entity
