The Impacts of Alliance Purpose and Partner Similarity on Alliance Governance

It is generally recognized that the governance structure of an alliance has an impact on its probability of success. In this study, we examine the choice between two alternative alliance governance structures: equity and non-equity. Drawing from transaction cost economics, two sets of factors, namely alliance purpose (R&D or marketing) and cultural distance between partners, are hypothesized to influence the above choice. We further hypothesize that collaborative R&D alliances, where both parties contribute technical knowledge, are more likely to lead to the formation of equity alliances than non-collaborative research agreements, where only one partner may be doing the research work. Based on a sample of 2407 alliances formed in the global biotechnology industry, we find partial support for the hypothesized relationships. Specifically, we find that collaborative R&D alliances are more likely to be equity alliances, whereas non-collaborative R&D alliances do not have any impact on the choice of the governance form. We also find that alliances formed with a marketing purpose are less likely to be equity alliances. We did not find any relationship between cultural distance and the choice of equity alliances.     

The Dynamics of Research Alliances: Examining the Effect of Alliance Experience and Partner Characteristics on the Speed of Alliance Entry in the Biotech Industry

Few studies have moved beyond the dyadic level of an ongoing alliance and examined factors contributing to the success of entering a series of alliances. In this paper we expect biotechnology firms over time to learn from their alliance experience and to develop general alliance capabilities. Specifically, we expect the speed with which they enter into new research alliances, e.g. their alliance formation rate, to be affected by capabilities built up in prior alliances as well as by characteristics of their partners. We use longitudinal event history data for the complete population of US biotechnology firms for 1973–1999 to test four hypotheses about factors affecting the rate of new alliance formation. Our analysis suggests that the speed of entering research alliances is affected by prior experience of the focal firm, but not by partner characteristics. Our findings provide evidence that biotech firms learn how to learn more effectively from multiple research alliances; however, this effect is generalized and not tied to specific characteristics of the alliance partner.     

Technological alliance portfolio configuration and firm performance

Firms pursuing technological alliances to gain competitive advantages have become a ubiquitous phenomenon in today’s business environment. This article examines which technological alliance portfolio configuration is better for focal firm performance using a portfolio rather than a dyadic perspective. To assess technological alliance portfolio effects on Korean pharmaceutical and biotechnology firms, we adopted three explanatory variables—number of alliances, number of partners, and spanning structural holes. The growth rate of revenue and the growth rate of profit are used as dependent variables. We identify two characteristics of technological alliance portfolios from the two-step generalized method of moments estimates. First, we find that between two firms with the same number of alliances, the firm with the larger number of partners would have a better performance. This result is unlike those in previous studies because it distinguishes between the number of alliances and number of partners based on the network theory. Second, we find that spanning structural holes affects firm performance rather like a double-edge sword—it positively affects the growth rate of profit but negatively affects the growth rate of revenue of firms. In short, spanning structural holes is simultaneously beneficial for firm profitability and unfavorable for firm growth. This result differs from those of earlier studies because it shows that a firm spanning structural holes among alliance partners produces either a positive or a negative effect, suggesting that a firm should vary its strategy depending on whether it prioritizes profitability or growth.     

Strategic alliances for corporate sustainability innovation: The ‘how’ and ‘when’ of learning processes

Mounting sustainability pressures challenge established firms to engage with sustainability innovations, which are often introduced by startups. Research on alliance learning has established the potential of learning from startups to advance corporate innovation. Here, scholars have outlined alliance learning processes and outcomes and have distinguished learning about and learning from alliance partners as two key learning types. The saliency of learning from the operational alliance process is stressed. To date, however, no study has investigated alliance learning processes and outcomes for sustainability innovations. This is despite the fact that sustainability research suggests learning processes in the sustainability context have a distinct nature. This study addresses this research gap by analyzing the sustainability-specific learning processes and outcomes of a large European meat producer and wholesaler with a turnover of $2.7bn in the fiscal year 2019/2020. The firm formed alliances with nine startups for sustainable plant, insect-based and cell-based protein solutions. Our analysis (1) identifies three distinct characteristics of sustainability-related alliance learning processes and outcomes, and (2) specifies the temporal occurrence and outcomes of learning types in alliance learning phases. In contrast to findings of prior research, our study reveals that learning about alliance partners is of key importance throughout the whole sustainability-oriented alliance learning process. In addition, the findings highlight that alliance learning outcomes may support an established firm's contribution to the sustainability transformation of mass markets.     

10 Learning and Strategic Alliances

Abstract

Various researchers have suggested that an important explanatory factor for the growth in strategic alliances is that alliances provide a platform for organizational learning, giving firms access to the knowledge of their partners. The notion that alliances are a vehicle for learning is the basis for an important and cross-disciplinary stream of research. This chapter examines theoretical and empirical research in the alliance learning area. We have two central objectives. The first is to integrate a large body of research by examining the key research questions addressed. The second objective is to critically examine the existing research as the basis for establishing a research agenda. Although the alliance learning area has generated a substantial amount of research interest and spawned wide-ranging types of inquiry, many important and substantive managerial issues remain underexplored.     

Organisationale Einflussfaktoren des Allianzerfolgs – Eine empirische Analyse auf Basis des „resource-based view“

Strategic alliances have become an essential part of business strategy and a central source of competitive advantage for almost any firm. Existing research has mainly focused on the isolated analysis of single alliances. This paper addresses the gap in the literature by analyzing organizational-level determinants of alliances success. Based on survey data from 302 firms, four organizational success factors of alliance management are identified and integrated in a structural model.     

Coping with Diversity in Alliances for Innovation: The Role of Relational Social Capital and Knowledge Codifiability

Alliances are increasingly considered a key element for innovation, especially in knowledge‐intensive firms. While this is true, the mere membership to alliances does not explain innovation performance, and thus the alliance's characteristics that determine high performance must be examined. This research address the question of how the diversity of partners in a certain alliance for innovation affects innovation performance, and how this influence can be moderated by certain characteristics, such as the relational dimension of social capital and the type of knowledge shared among partners. The empirical analysis of a sample of 90 biotech companies shows that there is an inverted U‐shaped relationship between alliance partner diversity and innovation performance and confirms the positive moderating effects of relational social capital and knowledge codifiability. These findings contribute to the current research on alliances for innovation by providing empirical evidence on why some alliances perform better than others. Also, the results suggest that the study of alliance partner diversity, as a determinant of alliance performance, should not be addressed in isolation.     

Building Reputations: The Role of Alliances in the European Business School Scene

How should businesses best choose foreign partners as they seek to internationalise? We use reputation theory to examine this question. Building reputation is a key aim on the European Business School scene, and this article starts by using more than 2,000 articles written by European academics in top quality journals to update the LRP research reputation rankings of European Schools. We then look at the way international research collaboration takes place, and find that alliances between schools are far from random. It seems that academics from US and European schools are strongly attracted to form alliances with one another, and the choice process appears to be consistent with reputation theory that suggests US schools seek out the most reputable foreign partners. Moreover, the “charmed circle” of high-reputation partners appears to be defined on a country-to-country basis rather than from a whole-Europe perspective. The lessons for managers in internationalising industries are that international alliance choice must include a reputation perspective, with great care being paid to the exact nature of the foreign partner's achievements.     

Alliance formation issues for knowledge-based enterprises

Inter-firm collaboration among knowledge-intensive firms is increasing as a result of accelerating competition, falling regulatory barriers and rising customer expectations. Resource dependency theory is used to position knowledge as the key resource for the knowledge-based enterprise and to examine the suitability of alliances as a mode of knowledge acquisition and exchange, contrasted particularly with merger and acquisition. The alliance and knowledge literatures are reviewed, and particular attention is paid to the critical alliance formation stage. This stage is reviewed against a research model that posits firm performance in knowledge creation arises from a number of factors, including the motivation for an alliance, partner firm characteristics (the ability to develop and sustain valuable resources; absorptive capacity; combinative capability; experience with alliances; and appropriate design for knowledge exchange), the development of operating structures and norms, and the choice of alliance structure. The paper concludes with suggestions for future research..     

International alliance formation and stock market responses:: Industry globalization as an environmental contingency

This study examines the effects of the degree of industry globalization on international alliance formation in terms of the type of alliance chosen by partner firms and stock market responses to the chosen type of alliance. Using a sample of 244 international alliances formed between U.S. and non-U.S. firms for the 1992–97 period, we find that nonjoint venture (joint venture) alliances take place relatively more frequently in global (multidomestic) industries than in multidomestic (global) industries. We also find that in global industries, abnormal returns to nonjoint venture partners are relatively greater than those to joint venture partners, whereas in multidomestic industries, abnormal returns to nonjoint venture partners are relatively smaller, though insignificant, than those to joint venture partners. Our findings suggest that the degree of industry globalization plays an important role in explaining which type of international alliance is likely to be chosen by partner firms when entering an alliance and how stock markets tend to respond to the chosen type of alliance.     

The Impact of Alliance Management Capabilities on Alliance Attributes and Performance: A Literature Review

The literature on alliances has identified a variety of inter‐firm antecedents of performance, including information and knowledge sharing between partners, shared partner understanding, and a focus on collective objectives. Recent studies have focused on alliance management capabilities (AMC) – firms' abilities to capture, share, store and apply alliance management knowledge – as an important antecedent of performance. This paper reviews 90 studies on AMC and makes two important contributions to the literature. First, the review provides an overview of and classification scheme for the different types of AMC to better organise the diverse empirical findings that have been presented in the literature. The novel classification distinguishes between general and partner‐specific AMC and between AMC stored within the firm and within the alliance. Second, consistent with the dynamic capabilities perspective, this paper offers a more detailed understanding of why AMC improve performance, by highlighting the intermediate impact of AMC on alliance attributes. In particular, the review demonstrates how the different categories of AMC influence alliances in terms of information and knowledge‐sharing between partners, shared partner understanding and the pursuit of collective goals. The review also demonstrates that these attributes improve performance. The authors note promising avenues for future empirical research that involve combining the classification scheme with research on the impact of AMC on alliance attributes and performance.     

Casting a Wide Net for Innovation: Mediating Effect of R&D Human and Social Capital to Unlock the Value from Alliance Portfolio Diversity

This paper examines the performance effects associated with different alliance portfolio configurations in terms of geographical location and partner type. Based on these distinctions, the authors hypothesize that more diverse alliance portfolios enable firms to gain and exploit innovation opportunities. Additionally, the mediating effects of R&D human and social capital on the R&D alliance portfolio diversity–innovation performance relationship are explored. The authors reason that the absorptive capacity of R&D intellectual capital determines a firm's potential gains from highly diverse alliance portfolios. From panel data of manufacturing firms in Spain for the period 2008–2013, the results confirm the inverted U‐shaped relationship between alliance portfolio diversity and firm innovation performance, implying that both insufficient and excessive alliance portfolio diversity may be detrimental to firm innovativeness. Additionally, R&D human and social capital partially mediates the R&D alliance diversity–innovation performance relationship, emphasizing the importance of internal capabilities to leverage the benefits of highly diverse alliance portfolios. These findings add a dynamic dimension to the conceptualization of alliance portfolios and how firms create value by balancing explorative and exploitative alliances.     

Embedded Networks and Suboptimal Resource Matching in Alliance Formations

Interest has been growing in alliance networks, and research has demonstrated several advantages of embedded networks, including joint problem solving. How embedded networks function as social capital and promote alliance formation has also been explored. However, less is known about constraints that they impose on firms’ extensive search for partners. In this study, we advance our understanding of the downsides of embedded networks by proposing that embedded networks facilitate alliance formations, but they may also cause suboptimal resource matching in alliance formations. Specifically, we predict that, in alliances where initial resource matching is more important than ex post collaborative activities, suboptimal resource matching is more likely when firms ally with partners with which they have pre‐existing direct or indirect ties and that such alliances decrease firm‐level resource utilization performance in operations. Using codeshare alliance data from the global airline industry, we find support for our predictions.     

Competition,formal governance and trust in alliances: An experimental study

We study the role of alliance governance in the behavior of partners in alliances with different degrees of competition. Using data from a lab experiment on 1,009 alliances and 31,662 partners' choices, we explore whether and how alliances succeed in different competitive scenarios, contingent on the use of formal governance mechanisms (termination clauses) and the number of partners in the alliance. We find that trust, an informal governance mechanism, emerges as a complement to formal governance in order to establish success in our experimental alliances, especially when competition is high. In particular, we document the significance of “trust-building” in initial stages and “trust repair” in later stages of our experimental alliances.     

Is experience valuable in international strategic alliances?

This study investigates whether firms benefit from prior alliance experiences as they undertake international strategic alliances. Different from previous studies that mostly focus on equity joint ventures, this study investigates non-equity alliances. This specific investigation is essential, because the complexity and uncertainty associated with such alliances potentially magnify the benefits of experiential learning. With a sample of 629 international, non-equity alliances formed by US firms, our results confirm the contribution of ISA experience in general, as well as that of experience specific to partner's country of origin and alliance activity type. The results also reveal a contingent benefit of ISA experiences, where experience of technological cooperation and experience with alliance partners from emerging countries both add more to firm value. We derive consistent evidence, as performance is assessed either by the market's perception of ISA value creation, or by the post announcement operating earnings in practice.     

我国高技术企业联盟治理结构选择的实证研究

本文以交易成本理论和关系契约理论为基础,研究高技术企业战略联盟治理结构.作者运用108个高技术企业战略联盟的样本数据,对本文提出的基本研究假设进行了实证检验.实证结果揭示了交易成本理论和关系契约理论在联盟治理当中的互补作用,也证明了不确定性和伙伴关系是决定联盟治理结构选择的关键因素.最后,作者对实证结果进行了讨论,并指出了进一步的研究方向.     

Agent and Task Complexity in Multilateral Alliances: The Safeguarding Role of Equity Governance

Multilateral alliances are an inherently complex organizational form; managing these complexities is particularly difficult for alliance partners because alliances are plagued by both internal and external uncertainty. Using insights from transaction cost economics, our study identifies, articulates and tests different forms of alliance complexity and their impacts on alliance governance structure. Specifically, we investigate two forms of alliance complexity: agent and task. We decompose agent complexity into organizational and partner complexity, and decompose task complexity into geographic, transaction and technological complexity. Using a sample of 327 trilateral alliances, the most frequent form of multilateral alliances, we find that three forms of alliance complexity involving internal uncertainty (organizational, partner and technological complexity) favor equity-based governance, whereas external uncertainty in the form of geographic complexity discourages equity-based governance.     

Survival during a Crisis: Alliances by Singapore Firms

In this study, we focus on the under‐researched issue of how environmental shocks impact alliance survival. We draw from several different theoretical perspectives such as industrial organization economics, managerial theories of the firm (such as agency theory) and institutional theories. We argue that the relationship between the occurrence of environmental shock and alliance survival is a contingent one. Specifically, we hypothesize that the following types of alliances will exhibit better likelihood of survival: alliances that yield a balance of short‐term and long‐term benefits (scale alliances) rather than purely long‐term benefits (link alliances); alliances that lead to either cost reduction or near‐term improvement in revenue realization (marketing alliances); and alliances that bring together partners from different economic regions (those involving Western and Asian partners). Based on an analysis of 348 alliances formed by Singapore firms, we find that marketing alliances and those involving at least one Western partner indeed exhibit a better likelihood of survival during the Asian economic crisis. We conclude that alliances that can enhance revenue potential in the short‐term are more robust to environmental shocks and that alliances can benefit from an effect similar to risk reduction through international diversification.     

Entrepreneurial orientation in vertical alliances: joint product innovation and learning from allies

This paper clarifies how a firm’s entrepreneurial orientation (EO) affects joint product innovation within a vertical alliance and how this is influenced by increasing technological uncertainty and the absorption of knowledge from the alliance partners. The results of a structural equation model with latent interactions on 171 firms in the manufacturing industry indicate that the focal firm’s EO increases joint innovation, although this positive effect declines when a high level of uncertainty increases. On the other hand, the ability to absorb partners’ knowledge increases joint product innovation. As such, this study’s results contribute to research in the field of vertical alliances, EO, and the theoretical foundation of a dynamic capability perspective.