Academic journal article Journal of Economic Cooperation & Development

Strategic Knowledge with Strategic Alliance Based to Achieve a Sustainable Competitive Advantage

Academic journal article Journal of Economic Cooperation & Development

Strategic Knowledge with Strategic Alliance Based to Achieve a Sustainable Competitive Advantage

Article excerpt

Strategic alliance has been acknowledged as an effective way to sustain a competitive advantage through knowledge management. However, research showed that strategic alliance has ignored new concepts on learning cycle and information that shared by partner. A failure of partnership in Small and Medium Entrepreunership (SME) usually caused by foundation from low commitment of partnership. It does not base on their need to grow together with the partners. This study developed and tested strategic alliance model as strategic knowledge to achieve sustainable competitive advantage. Result of this study showed that strategic alliance as strategic knowledge can be used to improve social capital which then influence human capital. Social capital is developed through a trustworthy partnership model and networking quality. Human capital is developed through skill, creativity and be the best model.

1.Introduction

The fundamental problem of the strategy management is how an organization can achieve a superior performance and maintain a sustainable competitive advantage (Teece, D.J, Pisano.G and Shuen. A, 1997). However, the resources possessed by the organization, if it is too easy for a competitor to improve and create the more effective substitution resources, are not a major factor to achieve sustainable competitive advantage. Hsu (2007) and Partha Chowdhury Prasad (2013) define that , the easier the technology is imitated; with the rapid change of competitors and the rules of society; the more organizational knowledge emerges as a major source of competitive advantage. The study by Galunic & Rodan (2008) on the resource-based view emphasizes that the resources based strategic knowledge become an important component in the new economic era. Furthermore, the important element to create an effective strategic knowledge is an alliance strategic that its consequences can lead to achieve sustainable competitive advantage (Cegarara-Navarro, 2005).

Strategic alliances or partnerships is one of the effective ways to gain competitive advantage through knowledge transfer (Constantine Imafidon Tongo, 2013 and Liao , 2007). Strategic alliance or partnership is an agreement that arises between two or more organizations to share the costs, risks and benefits which is gained by developing new business opportunities involving exchange, sharing of knowledge, developing products, technology and services (Hong Ji , 2010) . Yet, the study by Yadong Lu (2008) evoke that the strategic alliance ignores new concepts of the learning cycle and given information provided by competitors. The failure of partnership on Small and Medium Enterprises (SMEs) are generally caused by a lack foundation of partnerships and merely based on mercies, under the coercion of others rather than on the need to move forward and develop together with partnered parties. A phenomenon in SMEs industry, especially batik, a hand craft in Central Java Indonesia, SMEs have low sustainable competitive advantage. It is because they do not optimalizing the benefits of strategic alliance and do not take a learning condition between partner. As a result, most of SMEs members do their business with traditional ways, merely in production and marketing. Based on the description above, this article examines "How a strategic alliances model as a strategic knowledge can realize the sustainable competitive advantage of small batik industry in Central Java Province."

2.Literature Review and Hypothesis Development

2.1Strategic Knowledge

The process of learning as effect of the self-adjustment influences the relationship between a system and its external environment. The learning process can make people act in different ways according to the surrounding environment. In conclusion, it is the action of the actor itself that allows for learning. The strategic learning process refers to insight (an effort to find new things) and a view of the future. Nonaka and Takeuchi (1995) attribute the creation of knowledge with continuous innovation; and continous innovation with favorable competitive side. …

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