Question

Is equity ownership more useful and important for capability-building alliances than for results-driven alliances?

Answer 1

Equity ownership is the investment of stocks and exchanges in a business. So the employees can but the shares and equity as a preferred stock which would help the business develop its quality of outputs. When the business wishes to grow in size the equity-driven ownership of the business helps it to achieve the needful targets in terms of quantity and quality as suggested for the alliance. The employees can make a larger quantity of the products with great efforts which are now up to the business to market and sell. The equity-driven alliance makes the business have the needed quantity which is not particularly result driven and is based on the current setup and market demands. However, without the result drive the equity ownership loose the capacity of the long term growth and sustainability. So both the result and capacity development are important for the business where the policies are equity-driven.