Interfirm Alliances in the Small Business: The Role of Social Networks

In light of the increasing importance of strategic alliances in shaping competition, this study explored whether the social network of small firm executives can be leveraged to facilitate the establishment of interfirm alliances. Analyses are based on a mail survey of 149 small manufacturing firms in the northeast United States. Results indicate that the social networks of senior executives account for 11–22 percent of the variance in the degree to which firms engage in alliances, depending on the type of alliance. Results also show that the number of interfirm alliances is positively related to several networking properties (propensity to network, strength of ties, and network prestige). Findings are discussed in the context of network theory, social embeddedness, and the overall implications for management researchers and practitioners.     

Cooperative or competitive in alliance formation: Alliance patterns with respect to rivals

Premised on the assumption that strategic alliance is a type of competitive action toward rivals, this study explores how a firm uses alliances differently with respect to rivals. I distinguish between two types of alliances that directly involve rivals: alliance with a rival and with a rival's partner. The former and the latter reflect cooperative‐ and competitive‐orientations respectively. Further, I investigate what drives a focal firm to adopt a particular alliance rather than another. The findings indicate that the key consideration explaining different alliance patterns is the resource profiles of focal and rival firms. This study contributes to the literature on competitive dynamics and strategic alliance by suggesting a new approach to integrate interfirm competition and cooperation. Copyright © 2016 ASAC. Published by John Wiley & Sons, Ltd.     

An assessment of Colombian managers' perceptions of international strategic alliances

This article reports the results of a survey of Colombian managers concerning their perceptions of strategic alliances with foreign firms. The survey focuses in particular on partner selection and the managerial expectations from such partnerships, as well as the potential difficulties involved in developing interfirm linkages. The survey of Colombian managers shows that international strategic alliances are considered a viable approach to building a competitive advantage, especially in domestic markets, either through acquiring Western technology or marketing know-how. However, the survey results also suggest that a number of obstacles need to be overcome. The important considerations in partner selection, competence building through strategic alliances, and dealing with potential problems in establishing interfirm partnerships are discussed. © 1995 John Wiley & Sons, Inc.     

Management of international strategic business cooperation: Situational conditions,performance criteria,and success factors

In recent years, international strategic business cooperation has attracted great attention in both international management theory and practice. Several prominent examples demonstrate that interfirm alliances can no longer be viewed as second‐best solutions but must be recognized as efficient forms of internationalization. In this article, the specific management problems of international strategic business cooperation are analyzed and a systematic approach for their solution is presented. After outlining three examples that represent three different forms of international strategic business cooperation, a conceptual framework is developed that integrates three different perspectives: situational conditions, management instruments, and performance criteria. In the main part of the article, five success factors of international strategic business cooperation (partner selection, cooperation agreement, management structure, acculturation process, and knowledge management) are discussed. The article ends with a short summary and implications for further research. © 2004 Wiley Periodicals, Inc.     

Culture‐Led Discrepancies and Negotiating Conflicts in Strategic Outsourcing Alliances

Outsourcing and alliance collaboration have become prominent features of the global economy. Empirical studies demonstrate that outsourcing alliances are often not as successful as their initiators expect them to be. National cultural differences are frequently viewed as a crucial factor when such alliances fail. While empirical studies are abundant, theoretical frameworks that explicate the role of national cultural differences in shaping the dynamics of outsourcing alliances are rare. This article builds on Kumar and Nti's (1998) discrepancy model to specify how culture affects the dynamics of outsourcing alliances. We suggest that national cultural differences give rise to process and outcome discrepancies in outsourcing alliances. Notably, outsourcing alliances evolve through three stages–formation, operation and outcome–with discrepancies arising in each of these stages (Das & Teng, 2002). We develop a framework to link discrepancy management to these different stages, and to the notions of task‐oriented and relationship‐oriented cultures. Our study has a number of implications for future research and managerial practice. © 2013 Wiley Periodicals, Inc.     

The Influence of Partner Knowledge Complementarities on the Effectiveness of IT Outsourcing

Despite the importance of knowledge complementarities to inter-firm cooperation, few researchers in information systems (IS) have examined, to date, the construct of knowledge complementarities (KC), and none have examined its role in the success of IT outsourcing alliances. In this paper, we distinguish between potential knowledge complementarities (PKC) and synergistic value, which comprise KC. PKC is conceptualized as a multidimensional construct encompassing knowledge types (similar and specialized) and knowledge domains (business and IT). Further, we examine the extent to which PKC between the client and the vendor promotes success in IT outsourcing alliances. This research also includes relative absorptive capacity because it is relevant when complementary knowledge flows between organizations. We used data from a field study of 81 firms in Korea to test the proposed model. Our findings indicate that each dimension of PKC contributes uniquely to knowledge complementarities. The results also show that PKC is significantly associated with IT outsourcing effectiveness. Relative absorptive capacity is found to be a moderator between PKC and IT outsourcing effectiveness. The theoretical and practical implications of these findings are discussed in the paper.     

Information technology-enabled interactions,mutual monitoring,and supplier-buyer cooperation: A network perspective

This study, which integrates the literature on IT (information technology)-enabled interactions and governance mechanisms in interfirm relationships, proposes facilitated access to a network of partners as a key feature that distinguishes IT-enabled interactions from those that occur offline. Specifically, IT-enabled interactions improve interfirm network embeddedness, which in turn improves firms' perceived ability to mutually monitor each other. In contrast to the unilateral monitoring prevalent in prior research, the network-induced mutual monitoring, which reduces information asymmetry and improves power equity, improves cooperation performance without the backfiring “reactance” effect. Moreover, this study offers conceptual distinctions between formal and informal IT-enabled interactions and their different roles in supplier-buyer cooperation. A sample of 240 manufacturing firms in China contributes to this research, and the results strongly support the hypotheses. Overall, this study provides a better understanding of the role of IT-enabled interactions in supplier-buyer cooperation.     

Marketing Cooperation in Automotive Strategic Alliances

ABSTRACT

The increasing numbers of strategic alliances formed in many industries have been noted and discussed since the 1980s. This paper describes and analyzes change and stability in the patterns of cooperation that occurred within the global automotive industry during the period 1991–1995, with a particular focus on marketing and distribution cooperation. The geographical reach of marketing alliances is analyzed. The scope of the cooperation that occurs within inter-company alliances with marketing contents is also discussed, and the effect of participation in marketing alliances on individual actors is addressed. Using structural network methods, two measures of centrality are used and compared in order to determine the most central actors. The consequences of maintaining positions with different degrees of centrality in the alliance networks are discussed. The use of longitudinal data allows for analyses of the dynamic, changing nature of marketing alliances in the broader context of other forms of cooperation.     

Knowledge transfer in collaborations between foreign and indigenous firms in the Nigerian oil industry: The role of partners' motivational characteristics

Previous empirical studies on determinants of interfirm knowledge transfer have been largely focused on knowledge transfer between symmetrical partners, where there are relatively similar levels of knowledge sophistication and complementary knowledge‐transfer motives. Determinants of knowledge transfer between partners in asymmetric “market‐exploitation” alliances, where there are large differences in capabilities, and in motives, of the collaborating partners, have been understudied. This article presents a qualitative case study‐research of knowledge transfer in such collaborations in the Nigerian oil industry. Four cases of interfirm collaborative arrangements between foreign and local indigenous firms in the industry were studied and analyzed. Based on the results of the case study research, this article highlights the dominant role of partners' motivational characteristics, as against, their cognitive characteristics in the knowledge‐transfer process of asymmetric market‐exploitation alliances. It develops a set of theoretical propositions to expand the understanding of the key determinants of learning and knowledge transfer.     

基于价值驱动的企业网络组织异变机理研究

不同于大量研究文献中对企业网络组织的稳定性假设,企业网络组织在实践中的波动性、高失败率都折射出其动态性的本质。这些源于网络组织运行主体的松散性、主体间交易关系的交错性以及运行边界的弹性,因此企业网络组织常被视为“动态的网络组织”,而异变是网络组织的一个重要特征。文章基于价值驱动的视角,发掘出了企业网络组织的渐进型与激进型异变路径,即基于价值网结构稳定的渐变与价值网结构失灵的激变,有助于丰富网络组织动态性研究的内涵。     

The trickle-down effect of trust in business-to-business relationships: How can a supplier ensure cooperation from multiple customers?

Abstract

Although several interfirm cooperation studies have expanded the unit of analysis from dyads to triads (networks), there is scant literature focusing on whether and how a supplier’s relationship with a customer influences its relationships with other customers. Individual relationship dyads are not isolated but interact with one another. Particularly, mutual trust in a supplier–customer relationship dyad may influence other customers’ cooperative behavior. This cross-dyadic influence is called the “trickle-down effect of trust.” A hypothesis for the mechanism by which this effect occurs was generated, focusing on the customers’ demand information offerings as a cooperative behavior. The results of an empirical analysis indicate that (1) a supplier’s mutual trust with its primary customer encourages nonprimary customers to offer their demand information to the supplier and (2) the quality of information from customers helps the supplier to make their new product more meaningful.     

Outsourcing: Current and future trends

Highlighted are two reasons for outsourcing: cost and focus on the core competencies of the enterprise. Surveying U.S., U.K., and Continental Europe companies concerning current and future outsourcing trends positions outsourcing as a prominent strategic lever. Achieving “best‐of‐breed” practice is predicted to occur through new technology. Also, human resources and IT outsourcing will become more prominent. The results strongly indicate that partnership alliances and performance‐driven contracts will become as important as the current preferred, trusted supplier relationship. Keiretsulike, horizontal linkages will be required to realize scale and competency advantages from future outsourcing arrangements. © 2005 Wiley Periodicals, Inc.     

Extranet Use and Building Relationship Capital in Interfirm Distribution Networks: The Role of Extranet Capability

Firms are turning toward e-business technologies to increase efficiency and effectiveness and, thereby, acquire competitive advantage. We focus on interfirm distribution networks (IDNs) connected by extranets. Our thesis is that IDNs behave like alliances. As such, the network leader in the IDN may have an organizational capability related to developing and managing IDNs. This extranet capability is posited to positively influence three relationship capital resources (trust, information exchange, and communication quality), which, in turn, influence positively five network performance outputs (responsiveness, financial performance, efficiency, effectiveness, and innovativeness). Based on data from 175 new car sales managers, empirical tests of the hypotheses provide support for the posited explanation of IDN performance.     

Entrepreneurial alliances as contractual forms

Advancing upon taxonomical research on interfirm alliances, we investigate the design of entrepreneurial firms' alliances in more fine-grained terms by focusing on the specific contractual provisions that firms negotiate into their alliance contracts. Drawing upon transaction cost arguments, we examine the determinants of the contractual complexity of collaborative agreements in the German telecommunications industry. The findings reveal that alliance contracts vary greatly in their complexity, yet contracts for non-equity alliances tend to be no more or less complex than those for equity alliances on average. Furthermore, multivariate findings on the roles of transaction-specific investment, relational capital, search costs, and so forth demonstrate that firms' contractual and governance choices have distinct antecedents.     

Strategic alliances in emerging Latin America: a view from Brazilian,Chilean, and Mexican companies

Brazil, Chile, and Mexico constitute the leading newly industrialized countries (NICs) of Latin America. It is within these markets that the world expects significant economic gains over the next decade. Local companies in these countries are allying with foreign companies to enhance their competitive positions, yet little is understood about such interfirm collaboration with partners from these Latin American countries. Our study examines the strategic objectives of these Latin American companies, partnership structures, and their satisfaction in collaborating with companies from developed countries. Although existing studies have historically examined the dyad of strategic alliances from a perspective of developed countries (e.g., the U.S.), our study explores the issue from a perspective of companies in emerging Latin American economies.     

Strategic alliances by financial services firms

We examine a sample of strategic alliances made by financial services firms during 1986 to 2003. The market reacts positively to the announcements of alliances and seems to incorporate the information about the value of alliances at the time of alliance announcements. We find no evidence of abnormal stock performance after announcements. Our results also suggest that strategic alliances usually are used as a final form of cooperation rather than as a first step towards closer cooperation between firms. For instance, only about 5% of alliances are followed with joint ventures or mergers of partner firms. Nevertheless, strategic alliance firms are more likely to form joint ventures or merge than randomly selected and matched firms. Furthermore, the market reacts more favorably to the alliance announcements by firms that are subsequently acquired by the alliance partners.     

Deadlock in corporate governance: Finding a common strategy for private telephone companies, 1978–1998

This paper looks at how a group of small, incumbent private telephone companies complied with the international convergence of market structures. The existing research has mainly focused on large national incumbents, assuming a transition to multinational enterprise. This development process is often associated with privatisation policies and various institutional factors. The article tests these assumptions using a case study of the network of Finnish local telephone companies. It looks at the development of an interfirm network, its perspectives on the different phases of the deregulation process, and how the network tried to regenerate itself but failed to form a unified corporate structure capable of mounting a common business strategy. The reason for this failure resembles the idea of governance inseparability: private telecom companies were committed to the objectives and form of a tried and trusted cooperation model, which no longer met the requirements of the competitive and increasingly liberalised business environment of the 1990s. This case demonstrates that the significance of both corporate governance and organisational development are, above all, related to the firm’s ability to regenerate itself.     

The Space Between: Towards a Typology of Interfirm Relations

ABSTRACT

Understanding and managing the relationships between firms is the central issue in business to business marketing. Some of the results of a program of research undertaken in Australia to study interfirm relations are used to develop an empirically based typology of interfirm relations focusing on the mix of cooperative and competitive elements coexisting in a relationship. Measures are developed of relationship cooperativeness and competitiveness and relations are classified into one of four types based on whether they score high or low on each dimension. A dynamic process model of interfirm relationships is developed as a basis for identifying the main factors driving relationship development. Measures of these factors form the basis for regression analysis to identify the characteristics of each of the four types of relations and examples of particular relationships are used to illustrate the characteristics identified.