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Global Strategic Alliances: Why Form a Global Strategic Alliance

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For several weeks during my first year of solo exporting, I became obsessed with the idea of forming a global strategic alliance with a company that had a strong presence in Japan. I reasoned that my business life would then be less stressful and more efficient, and that I could enter the Japanese market much faster and more easily. I knew even before I started that Japan would be the single most difficult country in which to attempt export marketing, but the incentive was exciting: if you are successful there, you are considered a major global player. I already had a close tie with the largest trading company in the world, Mitsui & Co., Ltd., so I thought they would be an ideal candidate for the partnership I envisioned. Each day, I went over my mental list of the advantages:

Advantages to Forming a Global Strategic Alliance (GSA)

  1. Mitsui would provide unlimited capital to allow me to create, develop and export the kinds of American products I felt would be most suitable for the Japanese market -- capital I didn't have at the time.

  2. Mitsui would give me access to their customer base in Japan -- customers I didn't have at the time.

  3. Mitsui would put me in touch with the distribution channels I needed to get my products to the customers -- channels I did not have in place at the time.

  4. Mitsui would provide on-site after-sales service in Japan, which I couldn't do because I wasn't located there.

  5. Mitsui would share some of their other resources with me in case of need, or when a feasibility study on a specific business opportunity became necessary.

  6. Mitsui would support my business expansion in other parts of the world, since they have over 250 international branch offices.

There was just one catch: What was I bringing to Mitsui?

I couldn't think of a darn thing.

So I soul-searched and brainstormed and said, "Aha!" I could bring them me, a wanna-be global marketer, a trained and seasoned American businesswoman with no end of chutzpah.

Then I thought, big deal. You and a million others.

It's just as well that I got over this phase because it wasn't a global strategic alliance I needed. I needed to just dig in and do all the hard work I was trying to avoid, and keep building the business I had dreamed for so long of building.

I was considering a global strategic alliance for all the wrong reasons. Don't fall into this trap. Had I formed the alliance with Mitsui, the disparity in the resources and expertise each party was able to contribute would have doomed us from the start. I realized it would be better to get back on track with my own business, tough it out, and begin to create strength in everything I did. That way, when the time came around again to consider forming a global strategic alliance with another company, I would have something truly impressive and valuable to bring to the table.

Being an importer/exporter -- never content with the obvious explanation when suspecting there's more to it than that, never satisfied with one task when you know you could be managing the whole project, never happy with a project when you know you could very well manage an organization -- it's only a matter of time before you consider a global strategic alliance as a logical step in expanding your business.

It's not enough to expand domestically; that is not a global marketer's core business. Your core business is the world. Up until now, you may have single-handedly cemented strategic alliances with a network of agents and distributors to maintain access to markets worldwide, but you find that this is no longer enough to remain competitive. Now you may feel that you've gotten about as far as you can on your own, and you want to explore alternatives for kicking your international business into high gear. You're prepared to exchange a limited measure of creative control if it will get you established in highly lucrative new business territories.

Don't miss: Global Strategic Alliances: Advantages and Disadvantages to Global Strategic Alliances

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