ACCA Strategic Business Leader (SBL) Practice Exam

How are strategic alliances defined?

1. Agreements between organisations that create competition

2. Collaborations where resources and activities are shared

3. Contracts to sell goods and services between firms

4. Legal consolidations of two companies into one

The correct answer is: Collaborations where resources and activities are shared

Strategic alliances are best understood as collaborations where resources and activities are shared between organizations. This definition highlights the cooperative nature of strategic alliances, which aim to leverage the strengths and capabilities of each party involved to achieve specific objectives, such as entering new markets, sharing technology, or enhancing competitive advantages. In a strategic alliance, the participating entities typically maintain their separate identities while working toward common goals. This setup allows them to benefit from each other’s resources, knowledge, and expertise without the need for full mergers or acquisitions. The collaborative relationship can lead to innovation, increased efficiency, and improved market positioning. Other options depict different forms of business relationships. Agreements that create competition suggest adversarial or competitive arrangements, which is contrary to the essence of a strategic alliance. Contracts to sell goods and services are more aligned with commercial transactions rather than collaborative partnerships. Legal consolidations pertain to mergers or acquisitions, where two companies combine into a single entity, deviating from the cooperative, resource-sharing focus of strategic alliances.