Discussion:
"Cooperative Strategy" Please respond to the following:
1. From an ethical perspective, determine how much information a firm is obliged to tell a potential strategic alliance partner about what it expects to learn from the cooperative arrangement. Explain your rationale.
2. From the e-Activity, determine which type of cooperative strategy would most benefit the two companies you researched. Provide specific examples to support your response.
Use your research from the e-activity and CITE YOUR SOURCE.
Response
1. From my personal perspective, a company is obliged to tell a potential strategic partner about any decisions or plans that would hurt the firm's standing, have a potential negative impact on the strategic partner or their industry, or could have legal consequences. Obviously there are differences between legal decisions and ethical decisions, but in a strong partner alliance, the companies should be aligned both ethically and legally. When dealing with sensitive industry information, this communication can be handled through non-compete and confidentiality agreements.
2. As a person who lives in the desert, potable water is an incredibly important resource. Through a variety of interstate contracts, Arizona has agreements to receive trillion of gallons of water each year. This water, which is sent via open canal systems, like the Central Arizona Project and Salt River Project, then go to treatment facilities to remove impurities. Similar water treatment occurs in bottling facilities for companies like Nestle, who produces the water bottles for the Pure Life, Deer Park, Poland Spring, Acqua Panna, San Pellegrino, Perrier, springs, Water Park, and Waterline brands. Because of the heat, people in the Southwest drink 61.9 gallons of bottled water per person, each year, which more than 10 gallons per year more than any other part of the country. For this reason, a nonequity strategic alliance between Nestle and Phoenix Water Services would benefit both organizations. Sharing the water treatment processing facility would allow Nestle to use existing water treatment plant at lower cost than building and maintaining an additional water treatment facility. This would provide a strategic advantage against competitors like Pepsi Co and Coca-Cola, who need to maintain their own water treatment facilities. There would also be advantages to shortening the water bottle distribution path for a high volume community. Phoenix Water Services would benefit by receiving payment for leasing the equipment and certain percentage of treated water, which will assist municipal treatment facilities to maintain equipment and build additional technological advances or larger capacities, without relying on government funding.
Looking forward to reading about the companies you'd like to see align.