Dejan PAUVIT Memoire.pdf

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Research Thesis
The path for multinationals to succeed in a cooperative agreement
Written by PAUVIT Dejan
Specialization: International Business
Director of the research thesis: BESSON Ekaterina
Academic year : 2021-2022

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DÉCLARATION SUR L’HONNEUR DE NON PLAGIAT ET
RESPECT DES RÈGLES DE PROPRIÉTÉ INTELLECTUELLE
Année scolaire en cours : 2021-22
Spécialité : International business
Titre du mémoire: The path for multinationals to succeed in a cooperative agreement
Nom du tuteur de mémoire de recherche : BESSON Ekaterina
Je soussigné Dejan PAUVIT, atteste avoir pris connaissance du règlement intérieur de l’école
et certifie que le mémoire de recherche appliquée ci-joint ne fait l’objet d’aucun plagiat. Par
ailleurs, je m’engage à respecter les règles du dit règlement intérieur et les sanctions
disciplinaires qui en découlent.
Paris, le : 01/09/2022
Lu et approuvé

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AUTORISATION DE MISE A DISPOSITION
ET DE DIFFUSION D’UN TRAVAIL ETUDIANT
Madame, Monsieur,
Dejan PAUVIT déclare avoir réalisé un Mémoire de Recherche dans le cadre de la formation
de mon établissement scolaire en vue de l’obtention du diplôme de PSB Paris School of
Business, grade Master visé par l’Etat, sous la direction de Mme Ekaterina BESSON dans le
cadre de ma 5ème
année en International business
Intitulé du mémoire :
Informé(e) de mon droit de propriété intellectuelle sur les travaux produits dans le cadre de
mon cursus d’étude, j’autorise PSB Paris School of Business à mettre à disposition des
étudiants et enseignants chercheurs de l’établissement mon Mémoire de Recherche
Sous forme papier : OUI
Sous forme numérique avec accès protégé : OUI
Fait à Paris, le 01/09/2022
Lu et approuvé

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Acknowledgment:
First of all, I would like to thank Mrs. Ekaterina BESSON, my thesis tutor, who has been a
great support and encouragement throughout the elaboration of this thesis.
I would also like to thank Mrs. Marie-Claire MRJEN, head of the Master international
business, who introduced and learned through her courses the global functioning of business
strategy and partnerships.
A big thank you also to the people who took the time to help us in the reading of the thesis.
I would also like to thank the Paris School of Business for allowing me to do this thesis as
part of my studies. I would particularly like to thank my tutor and my colleagues in the
company who taught me a job and propose explorations in the framework of this thesis.
I would like to thank the people who accepted to interview them on sometimes delicate
subjects and to have given their time.
Finally, I would like to thank all the people who, from near or far, helped me to elaborate this
thesis.

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Abstract
Partnerships and alliances are now considered an integral part of corporate strategy, especially
for multinational companies. Multinationals quickly realized that working with other
companies and even competitors could yield greater benefits than if they had done it alone.
This thesis will focus on the importance of partnerships and alliances of multinational
companies and how these companies succeed in their strategy.
This research aims to test the hypotheses of successful business arrangements of multinationals
but also to nuance the actions that are sometimes difficult to succeed in a complex and
competitive environment.
Key words: Partnership, Alliance, Multinationals, Strategic management, Trust.
Résumé
Les partenariats et les alliances sont désormais considérés comme faisant partie intégrante de
la stratégie d'entreprise, en particulier pour les multinationales. Les multinationales ont
rapidement compris que le fait de travailler avec d'autres entreprises et même avec des
concurrents pouvait leur apporter des avantages plus importants que si elles avaient agi seules.
Cette thèse se concentrera sur l'importance des partenariats et des alliances des entreprises
multinationales et sur la manière dont ces entreprises réussissent dans leur stratégie.
Cette recherche a pour but de tester les hypothèses de réussite des arrangements commerciaux
des multinationales mais aussi de nuancer les actions qui sont parfois difficiles à réussir dans
un environnement complexe et compétitif.
Mots clés : Partenariat, Alliance, Multinationales, Gestion stratégique, Confiance

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Table of contents
List of tables and figures........................................................................................................................I-1
Introduction...........................................................................................................................................I-2
I. Literature review...........................................................................................................................I-4
A. Establish partnerships in multinational firms in order to find a win-win situation ..................I-4
1. Characteristics and key points...............................................................................................I-4
2. Reason for creating a cooperative agreements ....................................................................I-7
3. How select the partner in order to enhance the relation...................................................I-11
4. Traditional Approach comparing to partnerships...............................................................I-13
5. Success factors of partnerships...........................................................................................I-15
B. Partnerships can be difficult to set up and seen as a failure ..................................................I-19
1. Cooperate in order to compete...........................................................................................I-19
2. Notion of performance........................................................................................................I-21
3. Partnerships seen as unstable and difficult to evaluate .....................................................I-23
4. Organizational difficulties and cost.....................................................................................I-25
5. Trust on Strategic Partnerships...........................................................................................I-26
6. Failure partnership..............................................................................................................I-28
II. Case study...................................................................................................................................II-30
A. Company presentation...........................................................................................................II-30
B. Focus on partnership with start-ups ......................................................................................II-30
III. Methodology:........................................................................................................................III-32
A. Introduction:..........................................................................................................................III-33
B. Field of the research..............................................................................................................III-33
C. Research method ..................................................................................................................III-34
D. Structure of interviews..........................................................................................................III-35
E. limit of the research ..............................................................................................................III-36
IV. Results ...................................................................................................................................IV-37
V. Discussion and analysis ..............................................................................................................V-42
A. Traditional approach comparing to partnerships ..................................................................V-42
B. Data protection ......................................................................................................................V-43
C. A partnership failed................................................................................................................V-44
Conclusion ..........................................................................................................................................V-45
Bibliography........................................................................................................................................V-46
Annex..................................................................................................................................................V-48

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List of tables and figures
Figure 1. The main comparison between the traditional approach and the supplier partnerships
by F. Ian Stuart
Table 2: Performance measures for partnerships according to Child, 2005.

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Introduction
The globalization of the economy and the internationalization of markets have led to an
unprecedented development of strategic alliances and cooperative agreements. An increasing
competitive world forces companies to differentiate themselves in several possible ways in
order to continue growing other than the traditional strategic methods; they represent a vast and
complex field of research at the same time.
Many economists have spoken about this strategic aspect that multinationals are nowadays
aware. Multinationals give a great importance of this strategy. They are making business each
other even competitors together. In this plan, we are seeing that the strategy goes against a
traditional aspect with alliances and partnerships, companies will earn money that the
traditional business cannot deliver, it can be effective ways learn quickly a new market with
existing firms, to bypass governmental restrictions and have access to different resources,
reduce the cost of research and development for instance.
According to Gary (2004), strategic partnerships are estimated to represent more than 20% of
the revenues of international groups and this percentage does not stop growing. Big
multinationals firms have the strategic partnership in mind and lot of companies have succeeded
thanks to key partnerships they have done. Nike, the largest sportswear company in the world
does not manufacture a single shoe. Airbnb does not have properties. This highlight the fact
that multinationals can definitely succeed thanks to alliance.
However, strategic partnerships are not easy to establish and develop. Partnerships are failing
due to several mistakes made by management. By leveraging well-managed strategic
partnership arrangements, businesses can win in otherwise uneconomical markets. A successful
partnership requires a lot of time and energy for everyone involved. It is important for
companies to enter into a comprehensive plan and strategic partnership that outlines detailed
expectations, requirements, and expected benefits. Understanding the causes of failure can help
the strategic management prevent potential issue and adapt the relation between partners during
joint-venture process, negotiation to reduce the possible failure. (Garry D. Bruton 1998
“Anatomy of a Failed High Technology Strategic Alliance”)

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In this chapter, particular attention is paid to the relation of these partnerships in order to
understand the conditions for their success. More specifically, our interest will be in identifying
the factors that will focus on identifying the factors that affect the performance of partnership.
Firstly, we be focusing on the creation of a strategic partnership between Dyad, why it can be
a real advantage to do this strategy.
Secondly, we will see that to succeed in this kind of agreement it could be difficult due to
several issues and failure. After that, I thought that doing a case study with the big multinational
Thales should be interesting. We will see the methodology and discussion after in order to
explain more about the work I have done.
We will handle this work by responding to the research question “How how to set up a
successful partnership with a multinational company”.

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I. Literature review
A. Establish partnerships in multinational firms in order to find a win-win
situation
1. Characteristics and key points
In the introduction I argued that partnerships have received a lot of attention from researcher
(Das and Teng, 2002; Rosenkopf, Metiu, and George, 2001; Arino and Ring, 2010)
A strategic partnership is “Strategic partnerships are collaborative organizational arrangements
that use resources and/or governance structures from more than one existing organization”
(Andrew C. Inkpen, 2005, P.403). Traditionally, multinationals firms are willing to keep their
independence and put their competencies in their key company strategy. Nowadays, strategic
partnerships have become omnipresent in many industries. The complexity and uncertainty in
markets have increased to the point that creating an alliance is no longer an option. Strategic
alliances have the potential to generate a variety of benefits for partner companies, such as
access to new technology and complementary skills, economies of scale, and reduced risk.
Nowadays the terms alliance and partnership are mixed and there is a confusion about the real
meaning of the word. Frédéric Fréry (2011) explains the term of alliance and partnership in
2011. For the author, the terms alliance and partnership refer to agreements between several
organizations but are not really synonymous.
The alliances correspond to agreements made between competing organizations while the
partnerships designate agreements made between organizations that are not.

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There are two main types of partnerships.
 Outsourcing partnerships concern organizations that are not in competition with each
other. For example, car manufacturers and their main suppliers jointly develop new
technologies.
 Symbiotic partnerships concern organizations that are not only competitors but also not
customers or suppliers of each other. There is no commercial transaction; it is
interesting to know why they decide to work together. It is because they sell to the same
customer and it is better for these companies to share the implementation or marketing
courses. This is the type of partnership that exists between washing machine
manufacturers and laundry detergent manufacturers that finance a common advertising
policy.
About alliances, the authorities of the competition consider them as illegal because by definition
it is a question of agreement between competitors and thus of obstacle to the free competition.
In order to be authorized, it must be demonstrated that the alliances bring an advantage to the
consumer.
There are two types of alliances
 Complementary alliance: It brings together competitors whose scope of activity is not
identical, for example, slightly different product lines or operate in geographical areas
that are not completely grouped together, such as alliances between airlines like
SkyTeam. These companies can offer a greater number of connections on a bigger area.
 Additional alliance: These alliances bring competitors in order to achieve a faster return
on investment and thus provide a more attractive offer to the customer. This is the case
of Airbus, which was originally an alliance of French, German, Spanish and British
airlines, or the many alliances in the automotive industry that allow manufacturers to
share development and production costs.
This demonstrates that there is a real difference between the term of alliance and partnership.
The first term include the commitment between competitors that can be more difficult to set up
and the other between organizations that are not in competition.

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Nevertheless, these two strategies are difficult to establish and companies are willing to engage
in such commitment and choose to mutualize their resources in order to carry out a common
activity (Mayrhofer, 2003). These partnerships are based on a relational contract between the
firms.
Currently, there are many forms of BtoB partnerships. Thanks to the notion from Mayrhofer in
“Les facteurs de réussites du marketing relationnel, 2003”. We can highlight different form of
partnerships:
 The Joint venture is a form of partnership that involves the creation of a new
independent legal structure by two or more partners. Companies, even competitors,
work together. They use synergies or create themselves in order to achieve common
goals.
 The acquisition of an equity interest consists of the acquisition of a minority or cross
share of the capital of a company.
 Contractual agreements (license, franchise, R&D agreement, etc.) are forms of
partnership formalized by contracts.
Until the late 1980s, joint venture was considered synonym with the term alliance. Nowadays,
there is a large number of new forms of alliances; researchers have studied a much broader
range of cooperative arrangements that can actually appear. (Hagedoorn, 1993). Strategic
alliances of management does not exist when a relationship is based on an arms-length market-
based transaction. In addition, alliances could create interesting managerial problems due to the
exchange of information and knowledge between multinational firms. The knowledge may be
associated and secured with skills, technologies, future plans. When knowledge is exchanged
between firms, there is a risk that the knowledge may be appropriated or corrupted.

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2. Reason for creating a cooperative agreements
Why multinationals firms establish a strategic alliance instead of doing alone. They usually
include a formal agreement between the two parties to pursue mutually beneficial goals. Like
we saw in the previous idea, there may or may not be a contract, but both parties clearly
understand the goals of the partnership and are committed to work together in order to achieve
the desired results. The firm can create value in a way that it is not possible to achieve it alone.
Value creation in this case refers to the process of the mix between partner's capabilities and
resources to accomplish a common task that has the potential to generate money or other
benefits for the partner. While the perceived value of each partner is not necessarily the same
and is rarely the same, each partner in the alliance must have certain advantages for the alliance
to be the preferred choice. (Porter and Fuller, 1986). Thus, selecting the appropriate partner is
an important managerial decision (for research in this area, see Geringer, 1988).
An increasingly important goal of cooperation in the worldwide competition is one of the key
strategy for companies. Given the choice between alone development and alliances, many
companies are choosing alliances because they allow for faster strategy execution.
For example, nowadays we know that alliances are no longer legally required in Chinese
industries; companies can easily set up subsidiary. However, the entering into the Chinese
market is often slower and more difficult than with alliances.
Thanks to the technology, market access, companies can create value thanks to a partnership.
An alliance can be a faster way to establish a competitive advantage or development rather than
be focus on internal development. This is the reason why we have seen lot of alliance in
industries.

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The 21st century telecommunications industry is a great example of the industry who has been
using partnerships to rapidly changing technology and develop new opportunities.
The first reason is that multinationals want to attract new customers and expand the market
coverage. Perhaps, the most common reason to enter into a strategic partnership is to gain access
to new markets and customers. In this context, environmental uncertainty and the degree of risk
are high. A strategic partnership with a local company will reduce this uncertainty and share
the risk by giving the partner the necessary skills to create value and the necessary skills to
adapt to the market complexity. Both companies will benefit from the offer of a new product
that could complete an already existing range.
By forming a strategic partnership, companies can serve larger territories without investing in
additional infrastructure or expanding their distribution networks. For example, a huge
multinational logistic company like DHL might collaborate with an office supply company who
wants to deliver in their worldwide stores. These companies are willing to attract new potential
customers and are expanding their territories without the need to add additional stores or routes.
The second reason that it is important to highlight is that multinational companies would like
to set up a partnership to develop the brand awareness. The big coffee company STARBUCKS
give a huge importance on partnerships agreements with places like airports, Amusements Park
and other locations who provide coffee service to direct customers. Thanks to this partnership,
the visitors will buy Starbuck’s product but also recognize that the brand is present on this
location and they will appreciate the convenience of having brands they recognize available. It
is another form of marketing that Starbucks is doing well.
The strategy has increased its overall brand awareness and multinationals are willing to pay an
expensive amount to sell in these famous locations because they know that the return on
investment will be much more profitable.

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Multinationals are doing partnerships also if they would like to extend their products and be
diversified. Companies that want to attract new customer and new market should also develop
product line by creating strategic alliance. Thanks to this agreement, the company could
develop rapidly with the help of other who is well implementing on the market that the company
would like to reach.
By aligning yourself with a business enterprise that gives complementary products, the win-
win situation should be the result of this agreement.
One of the best example for what we provide is probably the partnerships in 2008 with the
famous audio speaker manufacturer BOSE and the carmaker RENAULT. In this agreement, we
are seeing the win-win situation that all these kind of companies want to have. They can be
present in new market without doing a lot of investment.
However, the objective of these partnerships should not be reduced just to the development of
new geographical markets and new potential customers (Blanchot, 2006). The companies for
example, can set up R&D partnerships, particularly in high-tech industries, where they are
mainly looking for new resources and industries to innovate. In addition, partnerships help to
minimize transaction costs by reducing, the costs of negotiating contracts. In the supplier way
of thinking, this kind of relation will be interesting for him because he has an important contract
in order to grow his turnover.
The company also benefits from resources from the other partners, which leads to the
development of new skills. The use of partnerships allows the company to improve its
competitive positioning, gain competitive position or gain market share. In this case, the
company can seek strategic complementarities with one of its competitors.
These complementarities can also relate to the resources or skills of the partner.

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The acquisition and sharing of resources between the partners allows for the transfer of skills
and knowledge and therefore a learning effect. The interaction between individuals leads to the
production of new organizational. Partnerships allow companies to have more contacts and to
ensure better learning. Thus, partnerships have real benefits not only in risk sharing and
knowledge acquisition, but it is also a way to improve the performance of the partners.
Regarding the BtoB relation, Multinational companies can set up also a productivity
partnership. A "productivity partnership" aims to explore ways of improving the service or
product offering based on feedback and best practices throughout the execution of the contract.
This kind of partnership is really based on the relation between two companies.

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3. How select the partner in order to enhance the relation
The work on partnerships and the associated attempts at theorizing have always been confronted
with a multiple way of thinking about partnerships and many authors have tried to respond more
or less elaborate reading lines, or from more empirical approaches.
Indeed, the theories mobilized to analyze inter-firm cooperation are very diverse (Combe,
1998).
We have seen in previous part why partnerships are created and what are the motivations.
Several authors as Blanchot (1999), Padoy and Puthod (1994) have done investigations on the
relation between partners and how they select their partners.
The most obvious reason is internationalization and entry into new markets. In this context, the
environmental uncertainty and the degree of risk are high.
Thus, a partnership with a local company will allow to reduce this uncertainty and to share this
risk by giving the partner the necessary skills to adapt to this market. In this case, the local
partner benefits from the offer of a new product that could complete an already existing range.
 The legal form of the agreement: It is one of the main distinguishing criteria of the
agreements and more than half of the classifications analyzed in this work refer to it
explicitly. It is often the basis for the conventional categories used in everyday practice.
There is two main classes to distinguish: agreements that are subject to a capital
commitment and those that have no capital link. This logic leads to a distinction between
the joint venture and the other forms of agreements thus; partnerships could be selected
thanks to the legal form of the agreement.
 The geographical origin of the partners. In a context of market globalization, the
geographical origin of the partners is not without consequence on the strategic
dimension of the cooperation. A first classification consists in distinguishing
transnational agreements from national agreements, but the observation of three
dominant economic zones has given rise to partitions within international agreements.
We have seen that there is a strong link between firms from the three of the Triad (Japan,
USA, EU), (Delapierre, 1991). Padoy and Puthod (1994) also introduce considerations

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related to the environment of proximity. They distinguish between industrial and local
partnerships, and the second between industrial and local partnerships. Geographically
close partners take less risk by doing business. They reduce the transportation risk,
reduce the shortage risk (we can deliver rapidly in industrial market for instance), reduce
cost is not always true when you delocalize in poor country but it could be a real cost
advantage, enhance de quality…
 The sector of affiliation. The sector is rarely an explicit parameter of the analysis except
in the case of studies of particular industries. Dussauge and Garrette (1992) have
highlight this idea in their data analyses. In this case, we generally use the nomenclature
of activities. We can see that generally company that are in the same sector or activities
are joining to create partnerships.
 The size of the partners. Dussauge and Garette (1992) have done an analysis about the
partnership and the aspect of the size of the partners. Taking into account the size of the
partners, most often based on the comparison of sales figures. We can highlight the fact
that the size of the partners is a pertinent aspect for the creation of partnership and the
relation between them. We have seen that some multinationals prefer create partnership
with huge companies but others prefer create with smaller companies. It may involve
power or dependency relationships between these two firms.
 Duration. It is a characteristic feature of agreements (Dulbecco and Rochhia, 1996). The
Most authors include this parameter in the definition of the notion of partnership or
agreement, which they contrast with the ad hoc practices of purchase and sale. Thus,
Baudry (1995) distinguishes subcontracting agreements (short-term, less than one year)
from partnerships. In practice, however, this parameter is rarely used as an operational
variable. Taking it into account (beyond the simple date on which the agreement was
concluded) undoubtedly poses problems of access to information.
The number of partners is not always discriminating when the majority of alliances are bilateral.
(respectively 60 and 85%, for example, in the work of Dussauge and Garrette, 1992).

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4. Traditional Approach comparing to partnerships
Traditionally, multinational firms are using call for tender to select their suppliers. On
purchasing approach, all the financial and technical requirements are define before the sourcing.
The supplier is selected among with different competitors. Most of the time, the supplier
selected provide the best price but nevertheless other criteria like quality, lead time, payment
are well valued by multinationals. In the traditional approach, the price is a very concerning
strategy and company’s purchase strategies are exclusively dedicated to low prices instead of
other factors that can help the company to have competitive advantage.
Authors have suggested that the use of traditional competitive approach should not be used
when aspect other than price are significant (Dobler, Burt, and Lee). Others authors have
suggested that the traditional competitive approach that lead to the supplier selection can have
hidden cost and lead to a higher total cost in the long term. (C.K. Hahn, K.H. Kim, and J.S.
Kim, “Costs of Competition: Implications for Purchasing Strategy”, 1986)
The strategy based on price at the expense of quality and uncertainty about contract selection,
can lead to a supplier complacency. The supplier will avoid all kind of investment in
technology, R&D, and improving products. Long-term stability and trust is welcome for
adequate success in business.
Even though traditional approach may lead to low price products in short way of thinking.
Nowadays, Traditional approach is an important strategy of the supplier selection process for
certain types of products, especially in semi-conductors and commodity type of purchases.
In opposition, the world actually is changing quickly. Multinationals companies have to be
aware of the changing environment to adapt their strategy. The win-win situation has grown
rapidly in an alternative to the traditional approach with a partnership or strategic alliance. This
agreement requires a trusting between the two "partners." The partnership expects an
information sharing and mutual dependency each other. These requirements are seeing in long-
term vision, because it takes time to generate benefit from partnership. In contrast, the annual
traditional contract negotiation is viewing as short-term relationship for a period of 1, 2 or 3
years. This contract can be non-renewal after the duration, with this idea we can see that the
traditional approach does not fit in long-term strategy (J.P. Womack, 1990)

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Figure 1. The main comparison between the traditional approach and the supplier partnerships
by F. Ian Stuart.
Traditional approach vs Supplier partnerships
Price is the main criteria for selection Multiple criteria including management
philosophy
Short-term contract (1,2 or 3 years) Long-term agreement
A lot of suppliers Few suppliers elected
Improvement are made at time intervals Enhancement is continually seeking by R&D
Problems are the supplier’s responsibility Problems have to be responded together
Information is proprietary Information is shared
To explain better the figure 1, the supplier selection decision in a partnership creation involves
requirements to select potential partners. Visits to manufacturing plans, interviews for reach an
agreement, management philosophy, commitment to quality and the R&D improvement are the
main requirements that suppliers need to fit in order to be partner. Such an investigation like
that require time and expensive, this is why multinationals take time and give an importance on
partnership to make longer term commitments in order to save money in a long way of thinking.
It is explained that supplier partnerships should be an integral part of a company’s quality
improvement strategy. (C.K. Hahn, C.A. Watts, and K.Y.Kim, “The Supplier Development
Program: A Conceptual Model, 1990”)
The most important distinguishing characteristic between traditional approach and the supplier
relationships should be the contract management process and the relation after the production.
The keys to a victorious partnership are the sharing of information in transparency aspect in
order to obtain the trust in the relation BtoB, the search for continuous improvement for R&D
project it require commitment for both companies to reach, and mutualize when problem appear
in order to solve with efficiency.

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5. Success factors of partnerships
Researchers have analyzed the potential factors that lead to successful partnerships. The authors
distinguish between internal and external factors that enable the establishment of a partnership.
 Internal factors :
Internal factors can influence the performance and instability of the relationship. These factors
relate to the partners, the functioning as well as the attributes of the partnership. These factors
have a direct impact on the partnership, particularly when the partnership is being set up.
o The factor regarding partners:
Several empirical studies have tried to establish a link between experience and the performance
of the collaborative relationship. This research postulates that firms develop specific partnership
capabilities and skills in the management of joint ventures. According to Beamish (2004), there
is a positive correlation between survival and the experience in joint ventures. (Brulhart, 2005)
Asymmetry of partners: asymmetric partnerships involve firms with dissimilar strategic
positions in terms of control of resources, financial capacities, etc. Internationally, these
partnerships evolve in an 'unequal' geographical context in terms of macroeconomic
development (Assens and Cherbib, 2010). To define asymmetrical cooperation agreements, the
authors take into consideration several criteria: size, bargaining power, management control,
learning capacity, etc. This imbalance very often leads to a relational misunderstanding between
the partners. This is why a good information asymmetry is necessary to sustain the relationship.
Number of partners: The number of partners is also considered a key factor in the performance
of partnerships. It is recognized that multi-partner between several partners are efficient as
opportunism and transaction costs are reduced. Some authors have pointed out the difficulty of
managing these multi-stakeholder organizational forms (Gong, 2007). The more resources a
partner has the more difficult it will be to ensure coordination between the allied firms, the more
resources the partner has, the more difficult it will be to coordinate between the allied firms,
and this will increase costs and lead to conflict.

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Inter-firm rivalry: Garette and Dussauge (1995) have expressed the fact that partnerships can
be a contradictory theory. Instead of confronting each other in a direct or indirect way, these
firms find themselves involved in a cooperative relationship. The objectives of each may be
different, which very often leads to misunderstandings and dysfunctions. Generally, this type
of relationship results in the weakening of one partner and the strengthening of the other.
However, this rivalry relationship does not necessarily lead to failure. In the case of
complementary contributions from both partners, the partnership can be a success.
Partnerships objective: this factor is directly liable to the partners. In this perspective, the
partners' objectives need to be convergent and compatible to ensure the success of the
cooperation.
o Factors related to the operation of the partnership
The trust: Trust plays a central and determining role in cooperative relationships. It helps to
understand the interactions between the partners and to explain their performance. If the
relationship between the partners is based on trust, this facilitates communication and thus
allows for the development of close links between the actors in the cooperation. However, this
bond of trust remains fragile because cooperation agreements are formed between several
independent or even competing companies. In this case, the risk of opportunism is high and
each partner seeks to protect itself from the other.
Values: The two partners need to develop a clear decision making process. If the partnership is
not clearly understand on the strategy and the goal they would like to reach it should an issue
for the future. A synergy needs to be establish in order to be successful in the partnership.
Commitment: this variable tends to reduce partner opportunism. Several studies have
demonstrated the link between commitment and performance (Brouthers and Nakos, 2004). A
high degree of commitment on the part of both partners can benefit the partnership. Partners
would need to have a value-creating interest to ensure effective collaboration.

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 External factors
External factors are focusing on the external environment of the partners and the characteristic
of the business sector.
o factors linked to the external environment:
Cultural distance: cultural distance reflects the diversity between two national cultures. Many
writers have investigated the impact of cultural differences in international cooperation. Most
of them conclude that the diversity between firms creates difficulties in cooperation. These
differences can be a source of problems related to communication with the partner. In addition,
the risk of opportunism may increase in a new context. Indeed, acting in a setting outside their
country, partners may act in an opportunistic manner because they are doing business abroad
and the consequences of their conduct are not likely to be harmful to their own country.
However, cultural distance can have a positive impact on cooperation agreements. Partners of
different nationalities can achieve significant synergies, for example, it can stimulate innovation
of both partners.
Country risk: several studies assert that the stability of international cooperation agreements
depends on variables specific to the host countries and in particular the emerging countries.
About international joint ventures, Yann (1998) explains that for agreements in emerging
countries, the economic and political uncertainty lead to a difficult management of the
partnership. He also says that country risk can be the cause of non-performance of international
joint ventures
Local governments are seeking to regulations that promote development paths through foreign
direct investment (FDI). Factors such as political stability and transparency of economic are all
elements that would have an influence on the performance of partnerships established in these
countries.

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The dynamics of external factors can greatly assist in the success of partnership relationships.
First, the phase of the industry's life cycle (start-up, growth, maturity, and decline) is strategic
information that allows partners to predict the evolution of the sector and ensure its growth and
profitability.
Secondly, the structure of the industry may vary from one country to another, shaped by
industrial concentration, consumer tastes and behaviors, market demand or the existence of
barriers to entry.
If a country is more open to trade and exchange between large companies, partnerships can only
be effective. These factors justify the use of partnerships rather than any other mode of
development (Blanchot, 2006). Some empirical studies confirm that partnerships are more
stable and therefore more successful than fully owned subsidiaries, especially in the context of
developing countries. Other authors assert that subsidiaries are the growth mode that ensures
better performance for firms (Yiu and Makino, 2002)

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B. Partnerships can be difficult to set up and seen as a failure
1. Cooperate in order to compete
Partnerships can be difficult to set up nowadays because of the different strategies that
multinationals have.
Inter-firm partnerships are often presented as cooperative rather than competitive. However,
alliances can also be interpreted as another form of competition rather than opposition. This is
something that can scare some companies and change their strategies.
Partnership is seen as a way of learning from one's partner. The alliance is not only a way to
exist in a strategic arena that would be inaccessible if the company were to venture into it alone,
but also an opportunity to acquire new skills through the learning of the new economic partner.
Yves Doz & Balaji S. Chakravarthy (1992) have done some research about this subject. These
authors highlight the fact that partnership can be seen to competition instead of the cooperation.
There are three key parameters on the relation that the authors underline.
 If the thirst to learn of one is significantly higher than that the other partner, it is very
likely that the capacity to learn will be increased by this desire to capture the skills of
the other. The flow of knowledge, expertise and interpersonal skills will mainly go in
one direction only. This may be an idea that could call partnerships into question.
 It represents the degree of formalization of the knowledge that can be transferred, i.e.
that model the interface between the two organizations. The greater the degree of
formalization of knowledge, the more accessible it is for the partners. If one firm does
not want to transfer the knowledge, the partnership should not be successful.
 The ability to learn from partners. In addition, to protect ourselves from our partners.

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Strategic agreements can be seen as a new form of competitive confrontation. This leads to a
review of the strategy or to train the teams in identifying the specific skills that interest the
partners. The idea is to do regular debriefings and observe our partners in order to appropriate
the knowledge and implement it within our organization.
Vertical cooperation:
Vertical cooperation, between the designer of the platform and the designer of the payload, can
also take place between international firms, whether or not they are direct competitors. Beyond
the industrial division of the activity, the cooperative dimension of the relationship also appears
in the sharing of risks. All product, financial and technological risks are borne jointly and
severally by the two cooperators. (Barney J.B, 1991)
Horizontal cooperation:
In this case, the two companies respond jointly to the call for tenders. The client receives a
proposal that mentions both the dual governance of the project and the dual responsibility for
risks. A real division of labor is set up between the two partners, going as far as the creation of
joint work teams dedicated to the project.

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2. Notion of performance
Many authors have given lot of research regarding the failure of partnership and the difficulty
to set up this kind of agreement. The notion of performance is always a key topic regarding
partnership agreement.
The performance is a topic that has attracted the interest of numerous researchers and leaders,
but it remains a controversial concept. Many writers have been interested in explaining the
conditions for establish partnership like the first part we have seen before. This is a crucial
question given that the failure rate of cooperative agreements is high, ranging from 30 to 70
percent (Reuer, 2004). It is also recognized that partnerships, and particularly international
ones, are unstable and risky systems because they are confronted with the uncertainty of the
environment in addition to that of their partner (Brulhart, 2005).
Franko (1971) was the first researcher to introduce the idea of performance in cooperative
arrangements as a research stream. In his study, he focused on the case of international joint
ventures. Subsequently, research on the subject has multiplied without reaching a consensus.
Garette and Dussauge (1995) attest that it is difficult to speak of the success or failure of an
alliance. The interruption of the alliance is not necessarily synonymous with failure. It may be
that the partners have achieved their goals and do not need to continue the partnership.
Conversely, an alliance may be maintained, not because of its performance, but because the
partners do not know how to separate. In this case, they feel that maintaining the alliance is the
riskiest choice. On the other hand, if the agreements made are stopped prematurely, for
example, before the launch of a jointly produced product, this refers to the product; this is a
sign of a failed partnership.

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The various contributions in the international management literature point highlight two distinct
conceptions of performance measurement of performance (Child, 2005): subjective measures
and objective measures.
Subjective measures refer to evaluations of the performance of the cooperative relationship
based on the opinions expressed by the managers of the partner firms or by the managers of the
joint entity. They include as variables the overall satisfaction of the partner’s satisfaction, the
achievement of objectives and finally learning that the partner will have. Satisfaction refers to
performance evaluations based on the assessment of the managers of the cooperation. In a way,
the establishment of a cooperation is justified by the recognition of a useful skill or resource
held by the future partner. It has been complementary alliances have been shown to enhance
learning opportunities, since the resources brought in are different.
However, in some joint ventures, the companies engage in a learning race in order to obtain the
partner's skills as quickly as possible, in order to break off the relationship prematurely. Several
studies have shown that the achievement of partners' strategic objectives is an effective and
relevant measure of performance. However, it is important to note that partner's goals may
diverge over time.
Objective measures are related to survival and longevity and can be quantitative. Quantitative
measures come from the accounting, financial stock market and strategic. These criteria are
mainly based on ratios such as return on investment, and return on sales. Some authors study
the evolution of the stock market valuation of partner companies following the announcement
of the cooperation. Other indicators such as sales growth, R&D expenditure growth, capital
utilization, are also taken into consideration.
Table 2: Performance measures for partnerships according to Child, 2005.
Type of measures Mesure of performance
Objective
Durability
Outcome
Financial figures, stock market, ROI,
ROS, market share, profit rate...)
Subjective
Overall partner satisfaction
Degree of achievement of objectives
Learning

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3. Partnerships seen as unstable and difficult to evaluate
Strategic agreements are often described as unstable organizational forms that are prone to
failure. Authors as Porter (1990) suggested that competitive and coordination costs make many
traditional partnerships rather than stable arrangements and therefore, agreement are rarely a
sustainable in order to obtain a competitive advantage. Several authors have found instability
rates of close to 50 percent. Based on the finding that 24 of the 49 alliances they studied were
considered failures by one or both partners, Bleeke and Ernst (1991) suggested that most
alliances will terminate, even successful ones.
To explain this kind of instability, factors have been highlighted: inflexibility in management
of the alliance, breakdowns in trust, transparency between the partners, Lack of communication,
continuity, and different partner expectations. The reality is that alliance performance is a
complex notion; the measurement and the evaluation of a partnership could be a difficult task.
Partnership and alliance are formed for a variety of purposes and often in highly uncertain
settings, performance evaluation becomes a very difficult task (Anderson, 1990). The first
belief argues that alliance performance should be evaluated as a mutual result and take into
account the perspectives of the partners in general. The idea of doing together is really
implemented in this case (Beamish, 1988).
A different perspective suggests that to measure the performance of a common agreement, the
partnership should be seen as individual partners and their created value. The idea explain that
each partner will have different cooperative objectives and abilities to appropriate partnership
benefits, For instance, one want to find a win-win situation in order to grow quicker. There is
the notion of together we can go further.
In opposition, other partner wants to use the partner’s competencies and appropriate the
knowledge to grow quicker than the partner. The focus should be on the individual aspect and
competitive gains of each partner (Hamel, 1991).

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Because of the difficulty of measuring performance, an approach that is easier to implement
and operationalize has been to focus on the stability of the alliance, based on the assumption
that an unstable alliance cannot succeed.
Beamish (1997) explained that instability in equity joint ventures should be linked with
unplanned equity changes or major reorganizations. He defined instability as a major change in
the status of the relationship, unplanned and premature from the perspective of one or both
partners. In general, instability results in the premature termination of the alliance, either when
one partner acquires the alliance business or when the business is dissolved. Using this
definition of instability provides a clear link to alliance performance.
Killing (1983) sees a change of control of the alliance and the ending of the venture as proof of
instability. Other investigators have taken a narrower view. For instance, Kogut (1989) used
closure as the only measure of instability. However, as Kogut explained, an alliance cannot be
considered unstable simply because its life cycle is short. All business relations face challenges
that threaten to change or terminate the basis of the cooperation.
Sometimes, terminations are planned and anticipated by the parties involved. Companies may
also be terminated as a matter of principle in the event of change of ownership or management
of the parent corporation.
One factor that complicates the examination of instability is that the end of the alliance will not
necessarily be a joint agreement (Parkhe 1991). A factor that makes it difficult to examine
instability is that the end of the alliance will not always be a mutual decision (Parkhe, 1991). A
premature break-up may be precipitated by the actions of a partner. For example, when a firm
tries to learn from its partner in order to reduce its dependency, the learning partner may have
very different expectations.
Yan (1998) have extended these arguments by interesting on instability perspective to identify
destabilizing forces in joint ventures. Yan has suggested that alliance researchers should move
beyond the hypothesis that stability leads to success while instability leads to failure. More
recently, Das and Teng (2000) provided a comprehensive review of the literature on instability
and developed a framework based on the internal tensions of cooperation versus competition,
rigidity versus short-term versus long-term orientation.

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4. Organizational difficulties and cost
Establishment of partnership and alliance are often difficult and expensive to create especially
regarding the organizational aspect. Moreover, the negotiation between start-ups companies are
more complex and face to a high degree of uncertainty, and time-consuming. The difficulty to
set up a partnership is difficult with start-ups due to the complexity of this kind of new company.
Nevertheless, most partnership like joint ventures are complex to form because of tough
negotiation process. There are several negotiation rounds; the first round took about four years,
which was then followed by another long negotiation to revise the initial agreement. (Andrew
Inkpen, 2001)
After partnership negotiation appear, there are various costs, for instance accounting, consulting
fees; travel expenses; financing and many others. In addition, the longer the negotiation take,
the more expensive it is, because the company is paying their collaborators even though we did
not reach an agreement. The global cost is increasing during the time especially due to the cost
of human resource.
In these partnerships creations, negotiations are seen more like investments for the future rather
than incurred sunk costs. Thus, managers may think, “Even if the alliance has difficulties to be
formed with the partner, we have invested so much time and energy in negotiating and forming
the alliance, we have to try to make it function.” As a conclusion of that, we can say that the
greater the resources allocated in the partnership agreement creation, the greater the probability
of persistence will be.

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5. Trust on Strategic Partnerships
Although it is hard to quantify, the trust has become a key concept in alliances and is subject to
multiple theoretical approaches. Partnership researchers (e.g. Das and Teng, 1998; Inkpen and
Beamish, 1997) have repeatedly argued that the mutual trust is essential for a successful
alliance. Without this, the partnership cannot function and be profitable.
Ariño and de la Torre (1998), in their study of joint venture failure, found that without a reserve
of trust, alliances that face threats to stability will not be sustainable. Yan (1998) argues that
the lack of trust between partners at the formation of the international joint venture can be a
major source of structural instability. As noted, trust is particularly fragile in international
alliances because the risk and uncertainty involved in a domestic alliance is increased in the
alliance context by transnational differences between the partner firms in culture, law, politics
and trade policy.
Inkpen (1998) examined the antecedents and consequences of trust in partnerships. He argued
that partnerships trust should be seen as an evolving rather than a static concept.
Over time, as partners and partner managers get to know each other and as the alliance becomes
an operational entity, trust becomes an important element of the alliance. the level of trust
between the partners will change. Trust requires familiarity and mutual understanding and is
therefore time and context dependent.
As the relationship matures, previous successes and failures, and interactions between partners
will influence the level of trust in the alliance. Trust can also decrease over the life of the
relationship. For example, when a partnership is formed, there is a subjective probability that a
partner will cooperate. The Experience will lead to the adjustment of the probability, which in
some cases may not be as high as it should be, of a partner cooperating. The level of trust will
vary depend on the cooperation. Risk is a precondition for trust to exist, and the trustor must be
aware of the potential risk that the partners can face.

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The risk of negative results must be present for trust to function and the trustor must be prepared
to be vulnerable. If there is no risk, trust is irrelevant because there is no vulnerability. The
higher the risk, the higher the level of trust required to engage in a trusting action. The nature
of risk and its interaction with trust has received limited attention in the research literature.
Other point that we should highlight is the link between trust and the performance of the
partnership. Yan and Gray (1994) has suggested that performance may have a feedback effect
on the trust of the partnership. Poor performance can lead to suspicion between members, which
in the long-term leads to poor performance of the alliance.
If the alliance performs less well than expected, partners are likely to question the skills and
capabilities of their partners. The level of trust in the relationship will be affected. In turn,
performance can be affected by conflict between alliance leaders, where a decline in alliance
performance leads to a decline in trust, which continues to amplify the performance problem.

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6. Failure partnership
What is Failure in partnership?
At the beginning of a project, companies need to specify not only the potential for success, but
also the potential for loss if the project fails. For example, many partnerships formed in China
and other emerging markets like Brazil or India have unrealistic expectations of project success.
Because of the perceived size of these markets, managers tend to overestimate the potential of
the project and minimize the risk of failure. Andrew C. Inkpen and Jerry Ross (2001).
Even though there are successful business partnerships, there are also partnerships that
completely failed. For instance, Heinz and McDonald’s; Kraft and Starbucks; Apple Pay and
PayPal; Lego and Shell.
Regarding the case of Heinz and McDonald’s, it appears when the most popular fast food chain
in the world and the very popular ketchup manufacturer have had a successful partnership for
over 40 years. It is one of the greatest case of betrayal regarding business partnerships.
In the case of McDonald's strategic partnership with Heinz, The ketchup company decided to
go ahead with McDonald's famous rival, Burger King. After Burger King's former leader,
Bernardo Hees, became the CEO of Heinz, McDonald has decided it was time to look for
another ketchup supplier for its delicious fries.

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Partnerships are fertile areas for dispute because everyone is a leader, or believes that they are.
This is one of the reasons why many partnerships end up in failure. Partnerships are formed
with the best of intentions. They fail for a variety of preventable reasons that new researchers
have given analysis regarding the possible reasons why partnerships fail. (Carl Robinson, 2016)
 They do not properly define their vision and the path in order to make money. As a
result, people frequently join partnerships for financial reasons, but leave because of a
gap between their values, career or life goals.
 They do not develop effective decision-making processes. Partners are going in
different direction and the common direction is not respected.
 The financial structure is usually oriented towards rewarding those who look after
themselves rather than the common good. Many partnership remuneration structures
encourage the creation of work doing alone rather than teamwork.
 Some partners end up holding the partnership hostage by threatening to take their clients
elsewhere. As a result, other partners feel marginalized. These partners eventually get
tired of being treated as second-class and leave.
 Partners tend to be so customer-centered that they do not pay enough attention to feeding
each other and non-associated staff. As a result, people do not develop a sense of
camaraderie and loyalty to each other and the partnership. They leave as soon as they
see a better opportunity elsewhere.
 Partners do not necessarily want to find a win-win situation. They only think of their
own profit. Or when one of the partners wants to leave the agreement.

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II. Case study
A. Company presentation
- Turnover : 16,2 billion € in 2021
- Net profit : 1 361 billion € in 2021
- 81 000 employees
- 70 countries worldwide
a French electronics group specializing in aerospace, defense, security and ground
transportation.
Regarding partnership and agreement, The multinational Group is currently working with
multinationals and with start-up. The partnership has a great place trough Group development‘s
strategy.
B. Focus on partnership with start-ups
The company has a long history of collaborative work and partnership with the innovation eco-
system
- The company has a long history of collaboration with universities and institutes as well as
with numerous SMEs. The open innovation strategy with start-ups, which dates back to 2014,
is a logical part of this tradition of co-development to detect innovations in terms of technology
and business models.
- Since 2017, The company has been piloting the cyber security program at Station F in Paris,
the world's largest start-up incubator. The incubator is now in its 5th class of start-ups supported
for 6 months by Thales. Fifty percent of them are French, while the others come from Europe,
the United States and Israel.

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- The company is also piloting the Artificial Intelligence program within the Centech incubator
in Montreal.
What are the company's areas of interest with partnerships?
Deeptech (materials, components, quantum technologies, energy storage); Smart sensors (RF,
optronics, acoustics, biometrics, location technologies); Connected object networks (IoT);
Reconfigurable and resilient networks; Cybersecurity; AI, Big Data and semantic analysis;
Autonomy in the broadest sense.
Why does the company work with startups?
- Company’s objective is to accelerate our innovation and even boost it by drawing on the
innovative capacity of start-ups and also on their agility.
- Disruptive innovations and new forms of business models proposed by start-ups are also part
of the objectives of our collaborations.
- We work together to combine their expertise with our technologies and our in-depth
knowledge of our clients' markets, so that we can make stronger offers that respond perfectly
to market needs.
How the firm succeed in partnership?
The partners quickly obtain a first profitable contract; this contract gives them the opportunity
to get an evaluation of their product by operational specialists
Partners are sharing with them a clear roadmap with milestones: at each milestone, if they reach
the defined objectives, their client signs a new contract with no revenue gap for them. In order
to carry out this type of partnership, it is important to agree on the objectives of the joint project
and to follow the same strategic line
This success factor depends on the stakeholders and the compatibility of their objectives. The
company emphasizes the importance of the partner's adaptation and understanding of the
group's expectations and reciprocally.
The success of cooperative relationships also depends on trust between partners.
In order to develop close relationships between the actors and to promote communication
between them, trust remains an important factor. Many employees said that without a clear

III-32
definition of the path they want to reach, without total transparency and communication the
partnership will fail during the time or will not be effective enough.
This study shows that at the company, in a new and uncertain environment, trust is a key factor
in the smooth running of the partnership. The partners do not control, in this case, the elements
related to the environment and must imperatively develop a climate of trust to ensure the
stability and success of the partnership.
In the framework of their partnership, the firm gives a crucial importance to trust and
transparency that is why it is complicated to make a partnership with this multinational. It takes
considerable time to choose the right partner to avoid wasting time and money.
III. Methodology:

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A. Introduction:
This study focuses on the success of partnerships with multinationals and the steps they take to
create a win-win situation. Through the literature review, we have seen how complex it is to set
up a productive partnership. Internal and external factors make it difficult. This is why
companies take their time to select the right partner in order to avoid important financial losses
due to a bad selection. We have seen how this subject has interested many researchers because
the financial, organizational and strategic stakes are considerable.
It is indeed of our opinion to study this subject through a quantitative method, the researchers
often had recourse to this approach to study the strategic dimension of the companies and in
particular the installation of partnership.
Thus, we will study some presuppositions of the qualitative research, which comes under the
naturalist paradigm. We will then see the field and the research methods, then the structure of
our interviews and finally the limits of the research and the questioning.
B. Field of the research
For this topic, an interest was taken in researchers who have dealt with this strategic business
topic. As Gary, Inkpen, Ariño and de la Torre, Yan and more precisely Bruton in 1998
“Anatomy of a Failed High Technology Strategic Alliance”), a qualitative study was conducted
for this research work. I wanted to bring a vision based on facts and precise subjects based on
theories and testimonies. The goal was to obtain depth in the information in order to seek quality
rather than quantity of information.
To obtain data and confirm the theses we have seen, I interviewed professionals in the field of
business strategy to get concrete answers on the subject. In order to get feedback from specific
people, I made questionnaires beforehand and started to find the people who could answer in a
good way through an interview.
To find these people, I targeted partnership managers, purchasing managers, business
development managers, alliance managers... .

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In order to collect interesting data, an important selection was made to choose the experts who
could most intelligently answer the questions. That is why I contacted via different platforms
(Internal company networks, LinkedIn, personal acquaintances etc...)
It took time to find these people because it was necessary to look for knowledge experts. These
experts will answer my questions and to the research question with the vision of the expert with
participating to the decision making.
Once the answers were obtained, I compared, analyzed and synthesized them in order to obtain
the best data related to our subject. In a second time, the idea was to put in relation the answers
obtained with the theories of the researchers that we saw during the literature review.
C. Research method
The research method will be the qualitative method. Qualitative research is generally
interpretive. The research is about thoughts, meaning or experience. It is not about testing
theories, but about understanding a given phenomenon from interpretations, testimonies or
opinions collected. In our case, the qualitative study is based on the collection of qualitative
data obtained through the case study and the interviews conducted during the research.
Among the exploratory studies, I have chosen the case study in addition to interviews as a
research strategy, which is defined as "a spatial and temporal analysis of a phenomenon
strategy, which is defined as "a spatial and temporal analysis of a phenomenon by conditions,
events, actors and implications" (Wacheux, 1996). Several elements justify this choice: the
research problem, the type of research question, and the means of controlling this subject. The
use of a case study is useful when the research question is stated in the form of a "how" or a
"why "to investigate a problem.
Results are often expressed as factual, verifiable, and observable. In most cases, the results of
qualitative studies are presented in the form of analysis and transcripts of interview responses.
The different methods of qualitative research are as follows

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- Interviews
- Observation
- Case study
D. Structure of interviews
POSITION EXPERIENCE SECTOR
R1 Buyer +10 years IT
R2 Alliance Manager +10 years Private Nursery
R3 Purchasing Director +15 years Defense
R4 Business
development
Manager
+10 years Defense
R5 Sales Engineer 5 years Electronic industry
R6 Commodity Buyer +10 years Automotive
R7 CEO 5 years Pastry
For this dissertation, the interviews were conducted using the semi-structured method, which is
a qualitative study method. Its purpose is to gather information that provides explanations or
evidence for a research study.
This method brings a richness and a great precision, and also allows to focus on the points that
the person would like to highlight the semi-structured interview is different in that it allows
individuals greater freedom to express their feelings, habits regarding a given subject and leave
space for the conversation. For my part, it is natural expertise and keep the conversation on the
track that I want and follow the path.
The semi-structured interview can take several forms. The targeted semi-structured interview
is a form that I decided to undertake for my seven interviews.

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This type of interview focuses on a specific experience. The aim is to ask open-ended questions
about a particular situation or phenomenon in order to understand the theme in a precise way..
The questions in the interview are focused on this fact.
 Questions on a specific aspect of the business partnership topic we studied.
 Ask short, direct and focused questions.
 Focus on understanding the specific topic, without deviating to other facts on the same
topic.
In order to establish a logical link between the research thesis and the questionnaire I first wrote
the literature review. This reflection allowed to obtain relevant results for the analysis. The
questionnaire is composed of several open-ended questions related to the different hypotheses
integrated in the thesis. The questions follow the guidelines of the literature review
E. limit of the research
I started looking for professionals to interview at the end of April. Indeed, to be able to interview
them, my literature review had to be completed. I only had a few months left to do these
interviews.
A selection was made to take people who had an expert opinion so that the collection of
information was the most interesting. That is why seven interviews have been realized. I think
that if I had had more time, I could have interviewed more people but I was divided between
the time I had and the selection of the experts that was important to me.
For me it was not interesting to interview people who had no real knowledge on the subject.
However, the results obtained supported our initial hypotheses.
In addition, I believe that a longer time frame (especially due to the summer vacations) would
have allowed for more interview responses to be obtained and thus strengthen the thesis.
Despite this, the majority of the interviews took place between the beginning of May and the
end of July. This allowed me to analyze in detail the data retrieved and to bring out several
general ideas useful to my research work.

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IV. Results
After several weeks of analysis, we were able to put together many data to put forward and
affirm several existing works.
The idea of representing the results was to express the ideas in a general way from the experts.
To analyze the result, I decided to put the most important notion that we discussed in interview
and explained the different way of thinking.
Partnerships creation
To begin with, without any debate, all the experts told me that it was better to set up partnerships
than to do everything alone. Of course, these partnerships must be set up for good reasons and
a good strategy but the idea of setting up partnerships is good according to the experts.
Most of the reasons given by the experts are generally synonymous but they differ depending
on the industry. I had the opportunity to talk with a buyer in the automotive sector, his company
is setting up partnerships and joint ventures with many companies in order to identify
opportunities to create and distribute value along its value chain. In this case, cost reduction is
important but in this model, which is based more on performance, these partnerships allow for
100% control of the supply chain and thus reduce costs overall.
If this company had not set up partnerships, it would not have controlled its entire value chain
and then the costs would have been much higher.
During my interview with the director of partnerships of the number 1 private daycare company
in the world. I was able to analyze the fact that these partnerships are created only for
profitability. Indeed, this company sets up partnerships of one or two years with large French
and international groups, the goal being to offer places in day care for the employees of the
suppliers of this group.
Other people interviewed expressed the fact that the partnerships allow to sustain the supplier-
buyer relationships. The implementation of partnerships also allows to develop its sales and to
acquire new markets.

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Other companies enter into partnerships to compete with their competitors. These companies
use partnerships to increase their skills in relation to their partner and in the medium to long
term increase their turnover.
Through this first question, we can see that despite the various opinions of the establishment of
a partnership, the main purpose of a partnership is the search for a win-win solution.
What are the different types of partnership that you are creating?
In the context of the interviews, the types of partnership are very different from each other.
Indeed, some companies chose partnerships in the sense of an alliance with a competitor. While
others go for classical partnerships.
For example, in the framework of private nursery multinational, the partnerships set up are
outsourcing partnerships because the partner companies are not in competition with each other.
A multinational company in the defense sector opts a lot for alliances, especially additional
alliances. These alliances bring together competitors in order to develop technology faster and
therefore provide better offers for the customer.
I was told that the big groups in the automotive and electronic sectors are making a lot of
alliances but also partnerships with start-ups.
On a smaller scale, a global company in the field of pastry is setting up symbiotic partnerships
with companies (weeding planner for example) in order to gain market share and to make
themselves known

IV-39
The advantage and disadvantage of partnership?
The advantages and disadvantages of setting up partnerships are quite different depending on
the sector of activity.
In the first place, most of the respondents answered that the main advantage was in terms of
price and quality of the products, because by setting up a partnership with a supplier for
example, the supplier can commit to lower prices and improve his quality. This allows
companies to obtain important economies of scale.
The second advantage is that it allows an acceleration of the growth of the companies and an
increase in their turnover thanks to the partnership. Finally for the companies of defense and
automobile it is partnerships allow to have access to new technologies and to be established on
new markets that this company does not have currently. For companies that have a strong
strategy based on research and development, these partnerships allow for a sharing of
investment costs and therefore production costs, which allows companies to develop rapidly
with lower costs.
Finally, the last argument is that it allows a pooling of skills and expertise in order to develop
more quickly and therefore improve relations between them.
Concerning the disadvantages, the interviewees are unanimous in saying that joining forces
with one or more companies, whether or not they are competitors, also presents risks.
First of all, partnerships can be a source of disagreement and conflict because of the partners'
different development visions. Some companies use partnerships to learn on the back of their
partner. This is the case in the Defense and IT sectors in particular. In this case, the collaborative
and beneficial aspect of strategic partnerships is totally broken.

IV-40
The success in partnerships?
After analyzing the results, the answers are quite different from each other.
Some experts answered directly with the question how to know if a partnership is successful or
not? What are the criteria for success? In large organizations, the notion of partnership success
is difficult to measure. Indeed, the success of partnerships is measured over very long periods
of time.
Whereas for smaller structures, the effectiveness of a partnership can be seen immediately
through the reduction of prices, better quality etc.
Concerning the success of these partnerships, all the experts indicated that a good relationship
based on trust would allow the partnerships to succeed. Other experts indicated that the
selection of partners was the most important thing for a successful partnership. Indeed, for
some, the success is in the selection of these partners.
If the selection is not managed properly then additional costs will be included and time will be
lost. This was the case for our expert in a large electronics assembly company. A productivity
partnership had been created with a company supplying electronic parts based in Taiwan. The
expert admitted to me that the selection had been made relatively quickly. After 1 year, the
negotiations were broken off for various reasons such as the lack of seriousness, prices not
respected and low quality.
All this has jeopardized the production of this group that assembles and produces in France.

IV-41
For the big group of private nursery, the partnerships are made on the short term that is to say
one year or two years. It succeeds this partnership because this group gives an importance to
the values that the partners transmit. It must be consistent with the development of the group to
find this partnership situation.
The expert calls it cross-selling, that is to say that they sell each other goods and services in
order to propose a better offer to the customer. Therefore, for the partnership to be successful,
the partners must be in the same frame of mind as the group.
The expert of the defense group told me that the greatest success was in the creation of joint
ventures even between competitors. Indeed, in the framework of these JVs, the competitive
aspect is put aside in place of cooperation to allow the development of the sector of activity and
more quickly.

V-42
V. Discussion and analysis
In developing the literature review, I relied on a number of studies and research studies
conducted by various authors.
In this part, I would now like to balance and compare the results of our research with these
studies. To accomplish this, we will divide this next to last chapter into three interrelated parts.
I wanted to do this approach because to understand better we have to be specific on certain
point that we should go deeper.
Part 1: Traditional Approach comparing to partnerships, why creating a partnership. Part 2:
Data protection. Part 3: A partnership failed.
A. Traditional approach comparing to partnerships
It should be interesting to discuss and analyze the approach that companies are more and more
aware. Nowadays, more and more companies are using partnerships.
Partnerships used to be reserved for large corporations, but through this study, I was able to see
that many SMEs are using partnerships with multinationals as a strategy that is well established
in the company. Although this study focused on multinationals, I think it is interesting to note
that there is a radical and global change in the strategy of SMEs. Instead of simply marketing
to companies, SMEs are now not hesitating to set up partnerships in order to obtain the benefits
that come with it.
All the people interviewed have a well-developed partnership policy. There is this desire to
succeed in partnerships.
The pastry company installed in a dozen countries also makes partnerships. Previously, the
company did not try to find an agreement with suppliers and potential partners to develop its
sales. Now it commits itself with suppliers on quantities, on quality so that it can benefit from
better cost and quality.

V-43
As part of the distribution, it has established many partnerships with wedding planners and
event organizers, the idea is to offer its services to future weddings or events and thus develop
its reputation and sales.
For the large defense, electronics and automotive groups, partnership strategies appeared in the
90's according to experts and are more based on the medium to long term, i.e. 5 to 10 years.
B. Data protection
The subject of the protection of companies has been studied only very briefly in this thesis. That
is why it would be interesting to discuss it in this part. To succeed in partnerships, companies
must protect themselves from potential attacks.
A potential attack can make the partnership a complete failure. Through the research and
interviews we conducted, we saw that not all companies have protection in place. Large
organizations have a zero tolerance policy towards protection. Smaller companies are less fussy
about data protection. The protection of the data of a company is characterized under several
forms
• Physical protection of data:
o A solid protection and security to access the site of the company,
o Securing the computer equipment with systems against data theft,
• Protection against cyber-attack:
o Comply with the laws and measures established by the DRSD for the protection
of information defenses,
o Be careful with the connection of USB keys and connections to unsecured Wi-
Fi
o Use powerful software to secure data.
There are features to properly protect sensitive business data. It is essential to be proactive in
order to secure computer data

V-44
C. A partnership failed
Strategic agreements are not easy to execute. The experts I interviewed told me that to avoid
failure; a partnership must involve a common goal or commitment that will benefit both parties.
To ensure that partners start on the same page and stay there, there must be open and honest
communication at the beginning and throughout the partnership. Too often, there is a gap in
expectations or understanding, which reduces the benefits to both parties and ultimately stops
the alliance.
Defense and automotive industry experts have told me that when you are collaborating with
another company, trust must be established and practiced at an appropriate level for
collaboration and it must be balanced in that both companies share what is needed. If you have
established clear guidelines for your partnership, these should include what information is
needed to be shared and how it will be shared.
From my point of view, I think this argument is very important and must be respected to avoid
any failure.
It allows companies to protect themselves from potential attacks from their partners. It is quite
common in this kind of strategy to want to learn on the back of your partner. None of the experts
told me explicitly that they are trying to steal knowledge from their partners, but some of them
told me that this could be a more "secret" strategy and not to be disclosed in the partnerships
because it could jeopardize the partnership and damage the reputation of the company.
Overall, based on analysis and personal input, the most important elements of a strategic
partnership are honesty and communication. Companies need to treat their partner, as a good
friend who deserves your respect and investment and you will be on your way to a successful
collaboration. The best partnerships are those where the respect and relationship is the most
pronounced.

V-45
Conclusion
The establishment of partnerships is a constantly evolving strategy that continues to attract
companies, even start-ups. The multitude of actors, the resources put in place and the pressure
generated by profitability and economic development forces multinationals to constantly
question their working methods. Indeed, the constant arrival of new entrants and the extremely
high competitiveness between multinationals affect the organizations as a whole.
Considered as well integrated in the company's policy and strategy, partnerships allow
companies to develop much faster than if they were individualistic. These strategies allow
companies to reduce their costs, have access to resources, learn, innovate quickly by sharing
costs, master their value chain and finally have a collaborative spirit even between competitors
that would allow to find a win-win situation. Instead of competing with each other, companies
collaborate with the aim of developing each other and thus offering a better expertise to the
customer.
However, these types of agreements are difficult to set up and are seen as unstable by some
scientists. The path to successful partnerships is far from simple, but there are many benefits to
be gained from success.
In the context of this thesis, the problematic was how to set up a successful partnership with a
multinational company. It is by carrying out each step of this thesis that we could see the
different steps and factors that allow companies to succeed in partnerships.

V-46
Bibliography
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V-48
Annex
Annex 1: Interview with a purchasing director of a defense multinational (+20 years of
experience)
Explain your way of thinking regarding partnership and why creating partnerships
instead of doing alone?
Being very familiar with the term partnership, I have the opportunity to set up partnerships on
a regular basis and to feed them throughout the year. I have been working in the purchasing
department of this large international group for over 20 years.
First of all, it allows us to put contracts in place and therefore to perpetuate our purchases,
improve our relationship with suppliers and secure our value chain. It also allows us to
analyze all our purchases and categorize them. Purchases made without partnerships are
difficult to measure and therefore to analyze.
We set up partnerships when we sign contracts with our customers. We commit ourselves to
substantial contracts with a very important objective of means and results. This is why we
create partnerships and joint ventures with the aim of satisfying the client as best as possible.
Without partnerships, we would not have been able to achieve the level of excellence that
characterizes us.
What are the different types of partnership that you are creating?
We make all types of partnerships and alliances within this structure.
We can already discern the two types of purchasing that we do in our sector.
Purchases outside of "non-partner" contracts and purchases under contract with which we set
up productivity partnerships with our suppliers, which we call vertical partners. Within the
framework of alliances, we set up JV's with competitors that allow us to join forces during
development on R&D or complex projects.
How do you select your vertical partners?
Vertical partners can be subsidiaries of our suppliers who help us on projects, it can also be
old suppliers who represent an important part of our expenditure, it can also represent entities
of our group who produce products that we need.
We call them verticalized because we set up specific partnerships and contracts with them.
The selection is made at the management level according to the customer's expectations and
the relationships we have with our partners.
What are the advantage and disadvantage of your partnerships?
As I said before, partnerships allow us to benefit from preferential rates on certain
components, to have better deadlines, better quality, access to numerous resources and to
conquer new markets, but this remains a general rule.

V-49
The main advantages on our side are the security of our purchases. There is a lot of pressure
to deliver in our sector, so we are less concerned about price (although it is very important)
but more concerned about controlling the whole supply chain. Control of the supply chain
allows us to have control of our product from A to Z, to be efficient and reactive in case of a
problem and this allows us to reduce costs considerably in the medium to long term.
The global governance and complexity of our sector requires us to be excellent in our supply
chain.
I would also like to add that with inflation and shortage of components, the supply chain must
be doubly controlled. We have seen that many companies have suffered, but those who have
total control have been spared.
As for the disadvantages, it takes a lot of time (several months or years) and negotiation to set
up a partnership. This means that it is very expensive and that you must not make a mistake in
your selection.
Moreover, these partnerships make us dependent on certain structures. We should not put all
these eggs in the same bag because first of all our negotiating power could be reduced and we
will be extremely affected if there is a problem with our partner.
What are the requirements that the company has to have before establishing a
partnership?
We do not have any particular requirements for our partnerships.
Selections are made at the COMEX level and are often based on the relationship between the
companies and the business history.
To answer the question more explicitly, if a company joins our supplier panel it will not be
possible to consider it as a vertical partner.
This aspect is reserved for one company parcel.
How do you protect your company from potential attack?
We have very strict rules regarding data protection.
As a large French defense group, we are subject to the strict laws of the DRSD concerning the
protection of defense information.
There is a very strong threat from national and international competitors who wish to
appropriate commercial or technical data that is classified as sensitive. This has an impact
both on our company and on the French state.
Unfortunately, I won't be able to answer what we are doing to protect ourselves. However,
many methods allow companies to keep their data safe.
When partnership failed?
In our framework, partnerships are difficult to define as failed.
Either the partnership failed because one partner wanted to end it early for various reasons.
This is the case of a joint venture in the United Arab Emirates that was dissolved because of
multiple disputes.
Or the end of the contract announces the end of the established partnership but we will
probably conduct new partnership with this company but with another contract.

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