Alliance Diversity and Firm Performance: The Moderating Effect of Alliance Strategies

TY - CHAP

T1 - Alliance Diversity and Firm Performance: The Moderating Effect of Alliance Strategies

AU - Li, Kathy

AU - Wang, Fatima

PY - 2016/12/2

Y1 - 2016/12/2

N2 - To what extent do having partners from different nationalities in alliances and possessing different alliance governance structures affect firm performance? Studies on the impact of alliance diversity on firm performance present mixed findings. This paper explores the potential moderating effect of alliance strategies on alliance diversity and firm performance. Using the resource based view, the paper argues that the impact of alliance diversity on firm performance may change depending on whether a firm chooses a standalone or portfolio alliance strategy. A standalone strategy may not encourage managers to re-combine the resources from diverse partners as each alliance is managed independently from each other. In contrast, for firms that adopt a portfolio strategy, diversity may be better leveraged because a portfolio strategy encourages managers to evaluate all alliances based on firm’s overall corporate objectives rather than on individual alliance objectives. Therefore, a portfolio strategy is likely to strengthen the relationship between alliance diversity and firm performance while a standalone strategyis likely to weaken it.

AB - To what extent do having partners from different nationalities in alliances and possessing different alliance governance structures affect firm performance? Studies on the impact of alliance diversity on firm performance present mixed findings. This paper explores the potential moderating effect of alliance strategies on alliance diversity and firm performance. Using the resource based view, the paper argues that the impact of alliance diversity on firm performance may change depending on whether a firm chooses a standalone or portfolio alliance strategy. A standalone strategy may not encourage managers to re-combine the resources from diverse partners as each alliance is managed independently from each other. In contrast, for firms that adopt a portfolio strategy, diversity may be better leveraged because a portfolio strategy encourages managers to evaluate all alliances based on firm’s overall corporate objectives rather than on individual alliance objectives. Therefore, a portfolio strategy is likely to strengthen the relationship between alliance diversity and firm performance while a standalone strategyis likely to weaken it.

M3 - Conference paper

SN - 978-3-200-05028-0

SP - 40

BT - Proceedings of the 42nd Annual Conference of the European Academy of International Business, Vienna

A2 - Puck, Jonas

A2 - Lindner, Thomas

A2 - Putzhammer, Moritz

PB - European Academy of International Business

T2 - 42 Annual Conference of the European International Business Academy

Y2 - 2 December 2016 through 4 December 2016

ER -