The paper 'Corporate Venturing or Market Entry' is a great example of a Management Assignment. The numbers of companies that are entering into alliances for purposes of corporate venturing or market entry or both have increased significantly in the past decade. There are three reasons that have been cited for these alliances namely; market access, alliance partner’ s complementary resources, and technology convergence (Casciaro and Darwall). Cisco Systems and HP fought over the technology business space for quite a while before they officially dissolved their 1997 partnership in February 2010.
But the two giants in the technology business recently came up with a plan to put their differences aside and forge ahead with the earlier alliance for the sake of the data center in order to jointly release a product that expands the Cisco incorporated Fabric into “ Blade system of the HP c-Class” . Considering the kind of relationship that has existed between the two companies since they dissolved their partnership in February 2010, their recent merger to offer a joint solution may have come as a surprise to many but according to analysts, the two companies must have recognized that they have a lot of mutual consumers including those that use Cisco networking products together with HP servers.
This customer-based end of the views this paper will use to analyze the merger between Cisco Systems and HP Challenges facing Jim Heal and Mike Thomas in managing the alliance Once Jim and Mike had formed the HP-Cisco Alliance, they had a duty to ensure that it worked and one of the essential aspects of strategic alliance formation is commitment. Jim and Mike had to go through the initial period of uncertainty before the alliance could make its first delivery.
HP had a challenge of outlining the true nature of the motives of Cisco, its capabilities, processes and culture, and Cisco systems likewise. They, therefore, had the challenge of making necessary adjustments, and these adjustments are what would later determine whether the alliance was going to survive or not. However, during this stage, both companies did not revisit the strategic decision and had to wait until the first deliverable. The challenge faced in this is the uncertainty about the capabilities of the other partner, considering that forming and bringing an alliance to fruition takes a lot of time and resources (Casciaro and Darwall).
At this point, Jim and Mike were faced with the challenge of making the alliance succeed. Secondly, Jim and Mike also had the issue of Culture to deal with. Firms can be despondent, average, or even good in the design and execution of an alliance strategy. Some firms are good at customer service while others are good at manufacturing and others in technology design and yet others in organizational strategies.
Cisco is a master acquirer while HP is a master in using partnerships to maximize external commercial inventions. The culture of the individual companies (sometimes referred to as “ impedance mismatch” ) posed a great challenge for the alliance (Casciaro and Darwall). Thirdly, when forming the alliance in question, there was the “ trust factor” to deal with. It is the case in most alliances that, the motivation of the partner in entering the alliance may not be clear to the other partner all the time and sometimes even to themselves and the HP-Cisco alliance was no exception.
Jim and Mike had the challenge of making those motives clear and clearing any doubt that they had both with each other and with themselves and to increase clarity and quality of partner motives hence engaging in trust, and making them widely known to the alliance personnel. The challenge of dealing with differences in motives if at all they occurred was a tough one (Casciaro and Darwall).
ReferenceCasciaro, T. and C. Darwall. "The HP-Cisco Alliance (A)." Harvard Business Review (2003): 1-21.