Strategic Alliances and Outsourcing Are Two Alternatives to Vertical Integration

question 65

Essay

Strategic alliances and outsourcing are two alternatives to vertical integration. What are the advantages and disadvantages of each compared to vertical integration? What can managers do to eliminate or reduce the risks?

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Definitions:

LMX

Leader-Member Exchange theory, a concept asserting that leaders develop unique one-on-one relationships with each of the people reporting to them.

Linkages

Connections or relationships between different elements, systems, or processes that allow them to interact or influence each other.

Leader-member Relationship Development

The process of building and strengthening the connection, trust, and mutual respect between a leader and their team members.

Gregariousness

The quality of being sociable, outgoing, and enjoying the company of other people.