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Execution and Performance of Strategic Alliances In Indian Software Industry*

CASE STUDY, STRATEGY
ET Cases - GSMC, 18 Pages
AUTHOR(S) : Komal J Khatter, Research Scholar, Strategic Management, IIT Delhi and Prof. Sushil, Deputy Director, IIT Delhi

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Execution and Performance of Strategic Alliances in Indian Software Industry

 

In the last few decades, most of the companies considered alliances as an important way to achieve strategic goals. The strategy of alliance started becoming the one of the preferred strategy to compete in global environment. Although there has been growth in alliance activities, yet there are strong evidences which show that alliance performance has remained weak. This generates curiosity, that when so many companies are entering into alliances, then why nearly half of them are not successful. It provides evidence that initializing and successfully maintaining an alliance is more difficult than expected.

Overview of the Company

Established in 1990, ABC is India’s premier e-business software provider and is focused on growing businesses. It has been a premier Enterprise Resource Planning (ERP) solutions provider for Indian businesses and was the first Indian company to offer Application Service Provider (ASP) services through its ERP -on-the-net offerings.

Life Cycle of Strategic Alliance at ABC

The strategic alliances at ABC go through certain phases as outlined below:

1. Market Research
2. Partner Search
3. Partner Evaluation
4. Business Partnership Agreement
5. Alliance Implementation
6. Performance Evaluation

Phase I - Market Research: The first step is to conduct a survey of the market, where the company wants to start an alliance. The first step undertaken by the company is to create a country profile on the basis of demographics, language, industry types/size. This helps in getting an understanding of the country’s IT maturity levels in terms of number of IT companies, software solutions in the market, government investment in IT projects. On this information, company takes the decision on whether alliance should be searched in this country or not.

Phase II - Partner Search: The second step involves the search for the prospective partner for developing an alliance. The following steps are undertaken:

• Creating database of leading IT companies through internet search
• Contacting the country’s Chamber of Commerce, IT bodies/forums
• Sending mailers to all companies in the database
• Participating in exhibitions in that country
• Participating in business delegation to that country
• Creating a shortlist of the companies who have shown interest in the alliance

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Teaching Note Preview

Execution and Performance of Strategic Alliances in Indian Software Industry

 

Synopsis

In this case study, two alliances of Indian mid-sized IT Company were carried out to understand the execution and performance evaluation of alliances. Among these two, there was one successful international alliance of the company, while the second one was an unsuccessful alliance of the company. The focus of the case study was to find out the variables which lead to success of the alliance and how execution has an impact on the performance of the alliance. The case analysis was done with the purpose to find out that whether excellence in execution leads to better performance of alliances or not.

Pedagogical Objectives

  • • To identify the dimensions of execution and find out how they are used by the company in its alliance.
  • • To identify the measures of performance evaluation and find out how is company analyzing its performance.
  • • To develop and validate relationships between variables of execution of strategic alliances and performance of strategic alliances.

 

Assignment Questions

  • I. Which variables are more significant for execution of alliances in software industry?
  • II. How can you categorize similar variables of execution and performance into groups and develop a framework for execution and performance of alliances?
  • III. Compare and contrast the execution of two alliances studied in the case?
  • IV. ...........

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Abstract

**IIM RAIPUR- ET CASES Award (GSMC 2016) – For a Case With Global Implications

This case study analyzes the international alliances of a midsized software company in India. The case study starts with the company profile; product description; market and customer specification of the company. This is followed by a general explanation of the business operating model of the company. The company has adopted the strategy of strategic alliances for its growth. After that the way company is following the phases of the life cycle of strategic alliances are outlined. Following which the summary of five alliances of the company is presented. This is followed by presenting two alliance situations of the company in detail. Finally, the analysis of the two situations is given. The case depicts the execution of alliances in real life scenario and it also develops the relation between the execution and performance of the alliances.



Pedagogical Objectives

  • To identify the variables of execution and performance of strategic alliance
  • To find a relationship among execution and performance of strategic alliances

Case Positioning and Setting
This case study can be used in MBA Program – Strategic Management course


* GSMC 2016, IIM Raipur



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- Case Study
- Teaching Note (**ONLY for Academicians)
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