Alliance Portfolio Internationalization and Firm Performance (original) (raw)
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Learning from experience in international alliances: antecedents and firm performance implications
Journal of Business Research, 2005
In this study of cross-border alliances, we argue that learning from past experiences is an efficient way to alleviate coordination challenges and, therefore, is a key factor that enhances the alliance performance of the firm. We also argue that learning from past experiences is an important factor creating superior performance for the firm through facilitating interfirm know-how transfer. At least two cultural aspects influence learning from experience: organizational commitment to the alliance relationship and learning orientation. We also explore the performance implications of learning from experience.
Costs, valuation, and long-term operating effects of global strategic alliances
Review of Financial Economics, 2007
Using global product design and development as an example of global strategic alliance, I find that successful global strategic competition is still largely a variable cost reduction game as opposed to the recently touted fixed cost amortization game. Further, the firm's cost efficiency is enhanced when its global production initiative is characterized by a high degree of strategic alliances. Importantly, I find that global strategic alliances have both valuation effects and long-term operating effects, and that both effects are positive functions of the degree of strategic alliances. After controlling for pertinent explanatory factors such as competitive strategy posture, industry concentration, geographic spread of operation, product-type, and information technology infrastructure of firms, I find that variable cost and production efficiencies remain significant determinants of the valuation effects of global business alliances. Overall, results in this study suggest partnering firms should consider the relative efficiencies of inputs and production technology as effective ways of leveraging the benefits of global strategic alliances.
Accelerating International Expansion Through Global Alliances: A Typology of Cooperative Strategies
Journal of World …, 2002
Firms with low levels of internationalization may feel the need to speed up their international development in order to be able to compete with multinational enterprises (MNEs) of bigger size and wider scope. Global alliances are a means to achieve such an accelerated process, not only because they allow ®rms to gain access to several markets at the same time, but also because they make it possible to enhance their own international competitiveness through the use of their partners' resources. This paper provides a detailed illustration of the competitive uses of global alliances as a means to accelerate the international expansion of the ®rm. Using evidence from 11 case studies on Spanish ®rms, we build a typology of four cooperative strategies. One of these strategies is based on local alliances, whereas the remaining three are based on global alliances. The paper presents a detailed case study of the ®rm which best ®ts each strategy found in global alliances. The implications of each strategy for alliance management, together with the possible evolution of each of them, are also discussed.
2017
The growth of alliances in developing countries has generated significant interest among scholars. Forming alliance is a reliable solution for companies based in developing countries to gain an advantage in international markets. Most of the previous studies present generic models or sets of characteristics for partner selection. In contrast, the current study suggests the partner characteristics which alliances' leaders should care about to be financially prosperous in international markets. Grounded in the resource-based view and review of recent studies, the theoretical framework of partner characteristics consisted of 13 variables. The data was gathered from Iranian alliances and analyses were done through the principal component and multiple regression analyses. The findings stress the importance of cognitive capability and knowledge stock as the most effective partner characteristics in export performance of alliances. Specifically, results introduce a framework that addresses why managers select partners with certain, specific characteristics to improve the export performance of alliances.
International Business Review, 2015
This research unpacks the paradoxes in knowledge transfer and learning processes in international strategic alliances by highlighting the contextual differences between partner firms. Due to knowledge asymmetry, the major source of firm-level difference, partners face paralleling dilemmas in terms of withholding or transferring/applying the knowledge to the other/cooperative context. This research argues that knowledge protection is deterred by the large institutional distance between partners and that the alliance performance cannot be improved because of the decreased absorptive capacity. However, such negative impacts of country-and firm-specific characteristics can be alleviated if relational capital is substantially accumulated by partners to enhance cross-border knowledge transfer and learning processes. This research explores whether frequent interactions, strong mutual trust and reciprocal commitment positively moderate the impact of knowledge protection on absorptive capacity and that of absorptive capacity on alliance performance. Theoretical and managerial implications are provided.
Strategic Management Journal, 2002
(1) what factors influence firms' ability to build alliance capability and enjoy greater alliance success, where firm-level alliance success is measured in two ways: (a) abnormal stock market gains following alliance announcements and (b) managerial assessments of long term alliance performance; and (2) are the two alternate ways of assessing alliance success correlated? We find that firms with greater alliance experience and, more importantly, those that create a dedicated alliance function (with the intent of strategically coordinating alliance activity and capturing/disseminating alliance-related knowledge) realize greater success with alliances. More specifically, firms with a dedicated alliance function achieve greater abnormal stock market gains (average of 1.35%) and report that 63 percent of alliances are successful whereas firms without an alliance function achieve much lower stock market gains (average of 0.18%) and only a 50 percent long-term success rate. We also find a positive correlation between stock market-based measures of alliance success and alliance success measured through managerial assessments. In addition to providing insights into the development of alliance capability among firms, this paper is one of the first to provide empirical support for the efficient markets argument by demonstrating that the initial stock market response to a key event positively correlates to the long-term performance and value of the event.
Developing alliance capabilities: an empirical study
Academy of Management …, 2005
This paper assesses the differential performance effects of learning mechanisms on the development of alliance capabilities. Prior research has suggested that different capability levels could be identified in which specific intra-firm learning mechanisms are used to enhance a firm's alliance capability. However, empirical testing in this field is scarce and little is known as to what extent different learning mechanisms are indeed useful in advancing a firm's alliance capability. This paper analyzes to what extent intra-firm learning mechanisms help firms develop their alliance capability. Differential learning may explain in what way firms yield superior returns from their alliances in comparison to competitors. The empirical results show that different learning mechanisms have different performance effects at different stages of the alliance capability development process. The main lesson from this paper is that firms can steer the creation and speed of their alliance capability development as different learning mechanisms have differential performance effects and are more appropriate at different levels of alliance capability.
LOOKING FOR ALLIANCE PORTFOLIO CHARACTERISTICS: THE CASE OF TELECOM INDUSTRY
In the last two decades firms are called to increase their performance by managing hundreds of alliances per time. Consequently, alliance scholars have started to adopt a portfolio perspective to investigate how companies might increment their performance. Despite a consistent number of studies has developed on this direction, in the alliance portfolio literature it is not easy to distinguish the drivers that guide firms to outcompete their rivals. This chapter aims to address this research question by examining the impact that characteristics of alliance portfolio might have on firm performance. Specifically, I approach this issue by identifying three alliance portfolio characteristics in the extant literature that influence firm performance; i.e., alliance portfolio size, alliance portfolio diversity, and alliance portfolio internationalization. Then, drawing on alliance data in the 1 telecom industry, I look at evidence of these alliance portfolio characteristics in three key industry players: Alcatel-Lucent, Ericsson, and Nokia. I conclude the study by discussing theoretical and managerial implications and suggesting future research avenues on this line of inquiry.