Strategic alliances for new product development in Hi-Tech firms

Abstract

Strategic alliances have been traditionally utilized by firms to mitigate pressures of new market entries, technology access, governmental pressures in new markets, channel access, time-to-market, and cost pressures among others. This research aims to explore strategic alliances from the realm of new product development in Hi-Techindustries. As part of this project, we have analyzed the stage-gate model for new product development. We have also analyzed various frameworks used for alliances, and have tried to separate them into stages as applicable to the stage-gate model. This has enabled us to secure a single view of stage-gate and alliances models, for new product development. We have also studied software products developed in India, and have analyzed it from the stage-gate and alliance model. The methodology of this project involved both primary and secondary research. Secondary research involved literature reviews of books which captures globalization and product development split across continents. We have also reviewed various articles on strategic alliances, new product development models and methodologies and case studies of co-operation between Japanese and American semiconductor firms. Primary research involved interviews with professionals who are or have alliances or partnership responsibilities. We have interviewed professionals from Indian product and services firms, professionals of MNCs in India, as well as frontline professionals of MNCs with geographical responsiblities. Some of the key findings of this research suggest:_ Firms in hi-tech products space need to collaborate_ This has been proven by software giants like Microsoft and Google even as this project is being undertaken_ Indian software firms who aspire to move up the value chain, needs to assess carefully what it can do in its space, and how it can collaborate with other firms and complement strengths_ Breaking up of the alliance activities and tying it to product development stages The importance of having a full-time alliance manager and to view administration of alliances as a task that encompasses understanding of cultures, people and not just business goals_ The importance of having an alliance portfolio and not place all eggs on one single partner Alliances should be considered as a weapon by firms venturing into new product development to minimize risk, but should be sufficiently mitigated from risks arising out of alliances itself.