Built to last or meant to end : intertemporal choice in strategic alliance portfolios

Bakker, Rene & Knoben, Joris (2015) Built to last or meant to end : intertemporal choice in strategic alliance portfolios. Organization Science, 26(1), pp. 256-276.

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Abstract

A salient but rarely explicitly studied characteristic of interfirm relationships is that they can intentionally be formed for finite periods of time. What determines firms' intertemporal choices between different alliance time horizons? Shadow of the future theorists suggest that when an alliance has an explicitly set short-term time frame, there is an increased risk that partners may behave opportunistically. This does not readily explain the high incidence of time-bound alliances being formed. Reconciling insights from the shadow of the future perspective with nascent research on the flexibility of temporary organizations, and shifting the focus from the level of individual transactions to that of strategic alliance portfolios, we argue that firms may be willing to accept a higher risk of opportunism when there are offsetting gains in strategic flexibility in managing their strategic alliance portfolio. Consequently, we hypothesize that environmental factors that increase the need for strategic flexibility—namely, dynamism and complexity in the environment—are likely to increase the relative share of time-bound alliances in strategic alliance portfolios. Our analysis of longitudinal data on the intertemporal alliance choices of a large sample of small and medium-sized enterprises provides support for this argument. Our findings fill an important gap in theory about time horizons in interfirm relationships and temporary organizations and show the importance of separating planned terminations from duration-based performance measures.

Impact and interest:

9 citations in Scopus
7 citations in Web of Science®
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ID Code: 70339
Item Type: Journal Article
Refereed: Yes
Additional Information: Published Online: April 15, 2014
Keywords: Interorganizational Relationships, Strategic Alliance Design, Time and Temporality, Intertemporal Choice
DOI: 10.1287/orsc.2014.0903
ISSN: 1526-5455
Subjects: Australian and New Zealand Standard Research Classification > COMMERCE MANAGEMENT TOURISM AND SERVICES (150000) > BUSINESS AND MANAGEMENT (150300) > Organisation and Management Theory (150310)
Australian and New Zealand Standard Research Classification > COMMERCE MANAGEMENT TOURISM AND SERVICES (150000) > BUSINESS AND MANAGEMENT (150300) > Organisational Behaviour (150311)
Divisions: Current > Research Centres > Australian Centre for Entrepreneurship
Current > QUT Faculties and Divisions > QUT Business School
Copyright Owner: Copyright 2014 INFORMS
Deposited On: 22 Apr 2014 01:32
Last Modified: 21 Jun 2017 00:01

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