Michael_A._Hitt,_R._Duane_Ireland,_Robert_E._Hosk

286 Part 2: Strategic Actions: Strategy Formulation

Figure 9.3 Vertical and Horizontal Complementary Strategic Alliances

Horizontal Alliance between Buyers (Each buyer is also a potential competitor)

Customer Value

Support Functions

Finance

Human Resources

Management

Information Systems

Vertical Alliance - Supplier

Value Chain

Activities

Supply-Chain

Management

Operations Distribution

Marketing

(Including

Sales)

Follow-Up

Service

for cancer and autoimmune diseases.”^42 More comprehensively, some of the world’s larg-

est pharmaceutical firms, including Pfizer, Bristol-Myers Squibb, GlaxoSmithKline and

Eli Lilly, are sharing some of their proprietary assets through a collaboration organized

by the U.S.-based National Institutes of Health. The primary purpose of this five-year

partnership is to more quickly discover and produce drugs that cure challenging and,

what historically have been, intractable diseases.^43

Commonly, firms use complementary strategic alliances to focus on joint long-term

product development and distribution opportunities.^44 For example, Boeing Company

and Lockheed Martin Corporation recently formed a partnership “to defend their prof-

itable Pentagon space rocket business with an all-new rocket equipped with reusable

engines that could slash satellite-launch costs and provide a steppingstone to various

commercial space ventures.”^45 Thus, the essence of this collaboration is pursuing oppor-

tunities to find ways to monetize operations in space.

9-2b Competition Response Strategy

As discussed in Chapter 5, competitors initiate competitive actions (strategic and tac-

tical) to attack rivals and launch competitive responses (strategic and tactical) to their