Strategic Alliances & Customer Impact: A Case Study Of Community Hospitals

Abstract

A strategic alliance (SA) is a mutually beneficial long-term formal relationship formed between two or more parties to pursue a set of agreed upon goals or to meet a critical business need while remaining independent organizations.  It is a synergistic arrangement whereby two or more organizations agree to cooperate in the carrying out of a business activity where each brings different strengths and capabilities to the arrangement.  The social structure of alliances has been considered previously (Gulati 1995, et al.), so instead of discussing the social structure relative to alliance partners, this paper looks at the relationship between the dyad alliance entity and its customer(s).  This newer aspect is particularly important when there are differences in trust and culture to consider (Das & Teng 1998) between alliance partners.  Other considerations include authority, governance and structure, conflict, and the make-up of the strategic alliance, its partners, and the customer(s).