Sharing competences in strategic alliances: a case study of the Cosan and Shell biofuel venture

In a competitive world, the way a firm establishes its organizational arrangements may determine the enhancement of its core competences and the possibility of reaching new markets. Firms that find their skills to be applicable in just one type of market encounter constraints in expanding their markets, and through alliances may find a competitive form of value capture. Hybrid forms of organization appear primarily as an alternative to capturing value and managing joint assets when the market and hierarchy modes do not present any yields for the firm's competitiveness. As a result, this form may present other challenging issues, such as the allocation of rights and principal-agent problems. The biofuel market has presented a strong pattern of changes over the last 10 years. New intra-firm arrangements have appeared as a path to participate or survive among global competition. Given the need for capital to achieve better results, there has been a consistent movement of mergers and acquisitions in the Biofuel sector, especially since the 2008 financial crisis. In 2011 there were five major groups in Brazil with a grinding capacity of more than 15 million tons per year: Raízen (joint venture formed by Cosan and Shell), Louis Dreyfus, Tereos Petrobras, ETH, and Bunge. Major oil companies have implemented the strategy of diversification as a hedge against the rising cost of oil. Using the alliance of Cosan and Shell in the Brazilian biofuel market as a case study, this paper analyses the governance mode and challenging issues raised by strategic alliances when firms aim to reach new markets through the sharing of core competences with local firms. The article is based on documentary research and interviews with Cosan's Investor Relations staff, and examines the main questions involving hybrid forms through the lens of the Transaction Cost Economics (TCE), Agency Theory, Resource Based View (RBV), and dynamic capabilities theoretical approaches. One focal point is knowledge "appropriability" and the specific assets originated by the joint venture. Once the alliance is formed, it is expected that competences will be shared and new capabilities will expand the limits of the firm. In the case studied, Cosan and Shell shared a number of strategic assets related to their competences. Raízen was formed with economizing incentives, as well to continue marshalling internal resources to enhance the company's presence in the world energy sector. Therefore, some challenges might be related to the control and monitoring agents' behavior, considering the two-part organism formed by distinctive organizational culture, tacit knowledge, and long-term incentives. The case study analyzed illustrates the hybrid arrangement as a middle form for organizing the transaction: neither in the market nor in the hierarchy mode, but rather a more flexible commitment agreement with a strategic central authority. The corporate governance devices are also a challenge, since the alignment between the parent companies in the joint ventures is far more complex. These characteristics have led to an organism with bilateral dependence, offering favorable conditions for developing dynamic capabilities. However, these conditions might rely on the partners' long-term interest in the joint venture.

Viral membrane fusion: is glycoprotein G of rhabdoviruses a representative of a new class of viral fusion proteins?

Enveloped viruses always gain entry into the cytoplasm by fusion of their lipid envelope with a cell membrane. Some enveloped viruses fuse directly with the host cell plasma membrane after virus binding to the cell receptor. Other enveloped viruses enter the cells by the endocytic pathway, and fusion depends on the acidification of the endosomal compartment. In both cases, virus-induced membrane fusion is triggered by conformational changes in viral envelope glycoproteins. Two different classes of viral fusion proteins have been described on the basis of their molecular architecture. Several structural data permitted the elucidation of the mechanisms of membrane fusion mediated by class I and class II fusion proteins. In this article, we review a number of results obtained by our laboratory and by others that suggest that the mechanisms involved in rhabdovirus fusion are different from those used by the two well-studied classes of viral glycoproteins. We focus our discussion on the electrostatic nature of virus binding and interaction with membranes, especially through phosphatidylserine, and on the reversibility of the conformational changes of the rhabdovirus glycoprotein involved in fusion. Taken together, these data suggest the existence of a third class of fusion proteins and support the idea that new insights should emerge from studies of membrane fusion mediated by the G protein of rhabdoviruses. In particular, the elucidation of the three-dimensional structure of the G protein or even of the fusion peptide at different pH's might provide valuable information for understanding the fusion mechanism of this new class of fusion proteins.