NUMMI

Paper Summary:

In this article the writer defines and analyzes joint venture agreements and business alliances in general. The writer includes in the analysis a specific look at the New United Motors Manufacturing Inc. (NUMMI) alliance between Toyota and General Motors. The writer explores why and how this alliance was created and looks at what each party expected to gain by entering into the alliance. Further, the writer discusses what each party actually gained and presents a conclusion on the alliance's success or lack thereof. Discussions of the importance of such alliances to business and individuals who participate in the business world are also undertaken in this paper.

From the Paper:

"In other words, a strategic alliance entered into by two business entities will usually be done so in order for both entities to benefit from the alliance. So it was with the creation of NUMMI."
"NUMMI was formed between Toyota and General Motors in 1982 as a strategic alliance. Their joint goal was to re-open a plant that had been shut by General Motors due to a number of negative factors. At the time of closure, it was considered (and numbers proved) to be GM's worst run auto production facility. The facility had opened in Fremont, California in 1963, and in 1978 employed over 7,200 employees. Just four short years later, the plant was closed."

Sample of Sources Used:

• Bork, Joseph (1991) Managing Effectively, New York: Sterling Publishing Company
• Cullen, John B., Johnson, Jean L., Sokano, Tomoaki., (2000) Success Through Commitment and Trust: the Soft Side of Strategic Alliance Management, Journal of World Business, Vol 35, Issue 3, pp 223 - 240
• Definition of Alliance (2006) http://www.google.com/search?hl=en&lr=&defl=en&q=define:alliance&sa=X&oi=glossary_definition&ct=title, accessed October 20, 2006
• Dyer, Jeffrey H., Kale, Preshant., Singh, Harbir., (2002) Alliance Capability, Stock Market Response and Long-Term Alliance Success: the Role of the Alliance Function, Strategic Management Journal, Vol 23, Issue 8, pgs 747-767
• Ertel, Danny., (2002) Alliance Management: a Blueprint for Success, Boston: Vantage Partners, a white paper

More papers on NUMMI:

• Term Paper # 122320 : "NUMMI and its Corporate Culture"
• Essay # 64081 : "Toyota as a Global Corporate Citizen"

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