It was an interesting news I read today that Microsoft had canceled its offer to take over Yahoo just because both companies could not reach a deal. Actually, Yahoo wanted Microsoft to buy their stock at US $37. But, Microsoft just agreed with the price of US $33 per stock. Yahoo thought that the offer was too low for their company that has a huge market of internet users in the world. Of course, that can be one of the reason why Yahoo denied Microsoft’s offer to merge with their company since Yahoo has a potential market and its strategic positioning in cyber world.

From the story, we can know that when a company wants to merge with another companya, they should learn many things about the company first whether the merger could add some advantages or profitable for the company or not. If not, so the company might think to cancel the merger. I think with or without merger, the company still can focus to their businesses and maximize their potential and resources to get advantages in the market. Besides, they can still find some strategies to add more profits for their shareholders, employees, partners, and their consumers.

One day, it was by chance I found an interesting book titled with ‘Game over . Press start to continue’ when I went to the library. This book was written by David Sheff on1999. He was very popular journalist and published many articles in some magazines in United States. This book tells about how games like Nintendo can easily get huge profits and conquered the world through its technology called games. The book noted that Nintendo Entertainment Systems (NES) had reached $500 million profits in United States. By 1991 Nintendo had been a successful company in Japan and became profitable companies. Then, this video-game business become larger segments of the entertainment and consumer-electronics industries in the world.

I think most of people are familiar with this kind of games. Most of youngsters, especially kids like to play games such as Super Mario Bros (SMB), which was created in 1985 by Japanese company. Nintendo itself in Japanese language means ‘leave luck to heaven’ or ‘deep in the mind we have to do whatever we have to do’ or ‘work hard, but in the end it is in heaven’s hands’. This term was found by Fusajiro Yamauchi in 1889. Firstly, he created Japanese playing-card company. Then, lately this game improved from times to times and become the most popular PC-game in the world.

So, what makes this company become very successful and what kind of technology that is implemented in this gaming industry will be more interesting to explore. Actually, the technology in that games is using new cartoon scenery and animation. But, the key successful of this gaming industry is on its strategy to control both hardware and software so that they can conquered the world and make other competitors like Apple computer that time feared most of this business. Nintendo could create a mascot and hero named Super Mario, which hypnotized children and adults.

I think, engineers also play important thing in making the success of this company. Like in the book mentioned that the developing of technology will depend on the skills of the engineers. Without scientists and engineers, technology will not be developed and created well. Technology needs a harmony collaboration among scientists, engineers and also industry. It is the same with Nintendo. The technology itself was created and developed from traditional and simple game first with few knowledge, then it became modern and advanced game until now.

Dui gave an example in the class that two big companies such as Microsoft and Yahoo could do alliance. I know, this news was quite hot in 2007 that Microsoft wanted to buy Yahoo that time in order to expand the market. That time Yahoo shares ended the day at $30.98, up about 10 percent and Microsoft shares finished at $30.56, down 1.3 percent. Actually, both companies had done partnership. Yahoo got supply ads that appear next to search results on Microsoft’s site. But, then the accord ended when Microsoft had AdCenter program.

The interesting question is why Microsoft want to take over Yahoo? I think the answer is just because Microsoft want to compete with Google. As we know that Google is the largest and best search engine in the world, which plans to reach a $3.1 billion purchase of online advertising company DoubleClick Inc. Actually, both Microsoft and Yahoo were also interesting in buying DoubleClick. But, Google finally won a search advertising deal and agreed to pay $1 billion for a 5 percent stake in AOL.

So, both big companies want to merge just because they need to compete with other big companies in the world in order to reach competitive advantage in market. But, until now the merger between two companies is still rumored and it has not happened yet. Perhaps, it can be true next time. Let’s see and wait..

Many job seekers will use 104 when they want to search new jobs for them. If they want to know some vacancies or news about jobs in some companies, they will go to see this website. All the information is provided in Chinese language. It is because this service, I think, is only for Taiwanese people. This 104 Job Bank is the largest website for human resources services in Taiwan. So, people feel that this is the best information for them to get some information about job vacancy. Actually, there are some websites using the same systems with 104. But, most of Taiwanese are more familiar with 104 than others. 104 always provides instruction, communication, and up-to-date information about jobs lists so that people will feel convenient to use it. 104 Job Bank will not charge any money from their customers who want to get the information. But, they are using advertisements in their websites so that they can get some profits from companies advertise in their website and can establish until now.

Do you need to know about job vacancies in Taiwan? Let’s visit 104..

As the increased of internet users nowadays, many people try to build their business through internet. The interesting phenomena came to color business world is when e-business or e-commerce introduced to people around the world. This caused many organizations provide their customers with the possibility to access their services on the internet.  One of the example of the service is the service for job seekers. Lately, organizations created service business by giving some information about job vacancy through internet. They also provide services to moderate the job seekers in applying some jobs and companies to hire new employees as well. This business become trend right now since people want the easiest and fastest ways to get some information and service.

Besides, many companies also use the same ways to recruit new staffs to their companies by using electronic human resources management (e-HRM) system. According to Ulrich, this system is to implement HR strategies by using web technology-based. The system is aimed to find right and professional candidates that can fit to their organizations as well. The system is well-known as electronic recruitment (e-recruitment). In e-recruitment system, company usually sets up a management process when they think that they need to hire new persons. This system is actually the same with the traditional system, but all the processes will be done by using the internet and web systems. The test and interview will be done via online, too. Here, the database will notify recruiters directly to the Human Resource Information System (HRIS) as well.

The implementation of technology in e-recruitment can be seen from the use of database system, Information Retrieval (IR) techniques, personalization of search engines, recommender system, interactive voice respose (IVR), and telephone. All these technology tools will help the company to advertise the vacancies, to deal with applicants, and to select candidates.  This system will have some advantages to the company. They can reduce costs and make routines in the company become fast and easy. But, the disadvantages can be found that sometimes the results is not really good. It is because the company do not meet face to face with the candidates when hiring them to their companies.

When two companies are doing merger, they need to do it very fast. It means that after they agree each other, they can do merger without waiting for some years. It is because the business itself runs so fast. Every things in business needs fast decisions and the best solutions. So, leaders should think carefully and act fast in order to catch the trend in market and make some strategies for their companies. This trend will follow customers demand and sometimes cannot be predicted since the market can be very fluctuating. The faster the merger, the better the result because it can make some opportunities occur for businesses.

This fast decisions sometimes seem do not consider about culture matters in the companies. The different culture, which belongs to one company, of course will make some changing in the company routines since they need to adjust with culture of their partners. Very often, this difference may cause some problems between them and tend to make the merger failed. As the time goes, both companies should learn each other from their strengths and weaknesses so that they can fulfill each other. The main point is that how the management in the company can handle it well. If the management system is good, I think, the problems can be solved soon by doing some solutions, especially to make employees from different culture (read: company) enjoy working together.

I found interesting discussion in the class today. Yuwen Chiu mentioned an evidence in the class that two companies can merge each other even though they do not have any problems in their companies. For example, Taipei- Fubon Bank- a bank company in Taiwan which has good financial condition- was merging with Fubon Bank in Hongkong. Fubon Bank in Hongkong is also a good company with good financial condition. They merged because the Taipei- Fubon Bank wanted to expand their markets in Hongkong, but they did not have any knowledge about Hongkong conditions and people. So, they tried to work together by doing merger with the bank in Hongkong in order to get more technology, knowledge, and the market in another country as well. Vise versa, the Hongkong- Fubon Bank also needeed the same thing. The company also wanted to expand market in Taiwan, but they did not have any knowledge about market in Taiwan and people as well.

From the case above, we can know that merger can be occured between two companies even they do not have any problems or we can say that they are health companies. The main reason is because they want to expand more their business in another country. They want to get the market there in order to get competitive advantage in market. Of course, by combining each other, the companies become very huge and can get a lot of advantages each other. They also can learn and get technology and knowledge from others.

As I mentioned before in my previous blog that we could not say which alliance is better to do since it can be different according to some situations and conditions when we start-up new businesses or when we conduct our own businesses. It will really depend on some conditions, such as capital, resources, and the market.

Before doing alliances and choosing which one is the most applicable, we need to answer what type of business that we are going to run. Is it starting a new business or growing a business? It is really important to know about the purpose of our businesses before making alliances. This starting point is to arrange some strategies for our businesses. Based on Grikscheit & Cag (2002) in their articles, when we want to build alliances, we need to think about strategy first since alliances are just tactic to help fulfill the strategy.

When we are in the condition of starting a business, and we are going to start a new business. I think franchise is better to do since we do not need to think about how to build the technology at the first time. Through franchise, we can will not get difficulties to build new brand anymore. Here, the contract is signed between the company (franchisor) and the individual who buys the business unit (franchisee) to sell a given product or run business under the company’s trademark. One example can be given is Mc. Donald which has a lot of franchises around the world. People like to do this alliance because of its known technology in the company and long payoff for this technology. But, franchise agreement requires continuing royalty from franchisee. So, franchisor needs to have detail contract and monitoring costs as well in order not to be failure.

But, if the condition is growing a business, we can build joint venture alliances with another company. This condition can be fulfilled if we think that our company has a potential market, but we are lack of human resources and capital to expand our business as well. By doing joint venture, we can hope that the company will become big. We will have more capital, more human resources and of course better technology to run the business. Vickers (1985) also mentioned that joint venture can be effective for small innovations. Vise versa, if we think that we do not have potential market, we can think to do merger with another company.

Besides, licensing agreement can be used as efficient cost-sharing mechanisms. It can be done if the company wants to get fast access to advanced technology rather than to create the technology.In licensing agreement, there is technology acquisition, which a firm agrees to pay a firm for the right either to manufacture of to sell a product. A company can put the name of their besides the licensed company if they make this licensing agreement. Unilever is one of big company, which has the authority to give license to some companies around the world. This type of alliance has disadvantage that the firm selling the right can lose the right to control its prices and marketing. The contract does not mention clearly about what is to be sold and what the licensee is to receive for licensing the product.

]]> http://h3ncy.wordpress.com/2008/04/11/the-most-applicable-alliance-for-business/feed/ h3ncy http://h3ncy.wordpress.com/2008/04/08/many-kinds-of-alliances/ http://h3ncy.wordpress.com/2008/04/08/many-kinds-of-alliances/#comments Tue, 08 Apr 2008 18:23:47 +0000 h3ncy http://h3ncy.wordpress.com/?p=24

It is common in business that a company makes alliances with another company to reach some goals and gains benefits for both companies. In the strategic alliance, there will be a relationship built between two or more corporations or business units, in which they will exchange some information and resources.

According to White & Bruton (2007)*, alliances are divided into some kinds according to some dimensions, such as formality, duration, and location. Based on formality, alliances can be classified into joint ventures (formal alliances), franchise agreement (formal alliances), consortia (informal alliances), licensing agreement (informal alliances), subcontracting (informal alliances), and informal understandings (informal alliances). If two or more companies combine their equity together and form a new third entity, we can say they do joint ventures. This type alliance has specific contribution and obligations, such as agreement about profits both of them can get. The company which joins the joint ventures is willing to know the details about what each party will do and what they can expect. But, probably, this type of alliance can have problems deals with strategic drift and culture clash since they are from different companies with different places. We cannot say which alliance is better to do since it can be different according to some situations and conditions when we start-up new businesses or when we conduct our own businesses.