Table of Contents

1.0 Network cooperative strategy
1.1 Advantages of network cooperative strategy.
1.1.1 Advantages of network cooperative strategy in term of five forces.
1.1.2 Advantages of network cooperative strategy in different market situation.
1.1.3 Different motives of network cooperative strategy.
1.2 How Toyota Motors use network cooperative strategies.

1.0 Network cooperative strategy

In the competitive business environment, businesses attempt competitive strategies to get the advantage over the competitors. However, sometimes rivalry can escalate in a way that it affect negatively to every company in the competition. Companies can’t achieve advantages always by just competing. Cooperative and collaboration between the organizations could help them to get the advantage over other competitors and potential new entrants in the same market. Therefore, now companies use competitive strategies to achieve the objectives via cooperation with other firms rather than always compete with them. This collaboration can be formal agreement between organizations and also it can be informal approach like mutual understanding between each other companies. It focus on the advantages which gain through cooperative strategy and how to work to realize the benefits. Network cooperative strategy is a strategic approach that several firms work together to accomplish common objectives via multiple partnership (Johnson, Whittington, Scholes, Angwin and Regner, 2016). This strategies are very effective when all the cooperative firms are located in close geographical area.
Competitive strategy focus on how organization can get competitive advantage over the competitors and they mainly focus on two approaches. One approach is that maximize the profit by using generic strategies such as cost leadership, differentiation and focus to get competitive advantage. Other approach is that using the firm’s core competencies and resources to get competitive advantage that competitors cannot imitate easily. The cooperative strategy can be support to achieve the competitive advantage by using both these approaches (bambord, Gomes-Casseres, and Robinson, 2003). These both approaches can be improved by cooperating with competitors.

1.1 Advantages of network cooperative strategy.

1.1.1 Advantages of network cooperative strategy in term of five forces.

Generally, there can be identified many benefits from the cooperative strategy to firms in term of five forces that Porter identified as buyers, suppliers, rivals, substitutes and entrants. This is illustrated in figure 1.