The key challenge facing a company was assumed to be its ability to maintain its independence by maintaining strong control over its activities. This important shift in strategic perspective was triggered by a variety of factors, including rising. R&d costs, shortened product life cycles, growing barriers to market entry, increasing needs for global-scale economies, and the expanding importance of global standards. Instead of trying to enhance their bargaining power over customers, companies began to build partnerships with them, thereby bolstering the customer"s competitive position and, at the same time, leveraging their win competitiveness and innovative capabilities. Strategic alliances- the increasing propensity of mnes to form cooperative relationships with the competitors. The term is used to describe a variety of inter-firm cooperation agreements, ranging from shared research to formal joint ventures and minority equity participation. Many firms worldwide are increasingly involved in strategic alliances. The scope and motivations for the modern form of strategic alliances are clearly broadening.