Golonka

Chapter 7
Mateusz Bodio, Monika Golonka
Corporate Entrepreneurship:
Manager Initiatives Leading
to a Reduction of Knowledge Leakages
in Strategic Alliances
Introduction
Polskie Górnictwo Naftowe i Gazownictwo S.A. – PGNiG is a large,
leading energy company in Poland. This company creates numerous
strategic alliances with their partners, both in Poland and at the inter-
national scale. Sometimes, the allies are simultaneously the company’s
direct competitors. What risks are related to such cooperation? How
does the company deal with them? Is there a place for corporate entre-
preneurship in alliances? In this study we aim to answer these questions.
Thanks to interviews with top managers, as well as an analysis of sec-
ondary data and the existing literature, we provide a description of the
major threats associated with coopetition, and the methods of their
reduction.
Definition of Alliance
The 21st
century brings new possibilities of development for companies
that search for new markets and new methods of expansion. Highly

152 Mateusz Bodio, Monika Golonka
developing and changing environments enforce continuous improvement
in order to gain competitive advantage, and to survive in a more and
more globalised world. One of the methods of competing that is gaining
the attention of managers is creating partnerships with other companies,
namely alliances.
The term ‘alliance’ comes from the French aliance, aliier meaning
‘marriage, combine, unite’ (Hoad, 2003). The phenomenon of coopera-
tion between firms has been observed for many years. Recent changes
related to globalisation processes and technology development lead to
a growing meaning of mergers and acquisitions, as well as alliances
between companies.
Alliance formation has been described as a method of access to ex-
ternal resources and competences. One of the most important resources
nowadays is knowledge. From this point of view, the main purpose of
such cooperation is gaining access to knowledge – as the fundamental
source of a company’s competitive advantage (Varadarajan and Cun-
ningham, 1995). An alliance is a voluntary arrangement among inde-
pendent firms created in order to exchange or share resources and engage
in the co-development or provision of products, services or technologies
(Gulati, 1998). Gulati (1998) highlights access to external resources as
the major purpose of such cooperation. It is also important for companies
to share their resources in order to learn from their partners. Therefore,
the simplest alliance definition refers to two or more organisations that
share resources and perform activities together in order to pursue a strat-
egy, fulfil objectives and tasks (Johnson, Scholes and Whittington,
2008).
There are several different categories and types of alliances in the
literature on the subject. One of the typologies involves distinguishing
two groups based on capital investments. Contractual or non-equity
alliances refer to interfirm cooperation created usually in order to realise
a single task. These types of agreements are generally created for a de-
fined period of time – for example licensing or franchising. The second
group consists of equity ventures (jointly owned). In this group of
alliances participant investments are one of the factors aiming to secure
the effectiveness of the partnership. Companies create joint ventures in
order to conduct, for example, R&D projects together, to share not only
investments, but also costs of expensive research and development ac-
tivities. Relationships between companies may take many forms, since
the term alliance currently means any form of ties between firms

Corporate Entrepreneurship: Manager Initiatives Leading to a Reduction of Know ... 153
(Golonka, 2012). Interfirm ties differ in terms of their quality, formal
structure, trust between partners, purposes, resources, etc.
In this study, we focus on joint ventures. A joint venture, as a separate
entity created and jointly owned by two or more companies (remaining
independent firms – called parents) is an equity venture. Aside from the
benefits for the partners, problems might also arise during such coop-
eration. In a joint venture the parent companies may use several methods
of solving potential problems in their strategic alliance. Furthermore,
they may also sell their shares and leave the partnership. In this type of
alliances, organisations often cooperate with their direct competitors.
Interactions between allies may create additional value, since partner-
ships usually work on a synergy basis. However, such cooperation may
also be a source of tensions and threats. In such a situation, companies
may behave in two opposite ways: cooperate and compete – scholars
called it the ‘coopetition paradox’ (Lozano-Platonogg, Rudawska and
Pachciarek, 2014). This phenomenon – competing and cooperating at
the same time – mostly occurs between companies that actually compete
in the same market.
Cooperating and Competing: Coopetition
Coopetition is an interesting topic in management science, as some
scholars perceive it as an innovation in cooperation (Lozano-Platonoff
et al., 2014). The term coopetition derives from two opposing actions:
competition and cooperation between organisations (Bengston and
Kock, 2000).
Historically, these actions were perceived as two opposite sides of the
same coin, but nowadays coopetition – both competing and cooperating
– is perceived as one of the most effective strategies of company develop-
ment (Bengston and Kock, 2000). Firms enter this type of partnership
mostly for a short project, or research and development (R&D), in order
to share costs, as well as the risks associated with uncertain actions.
There are many reasons why companies enter into alliances with their
competitors. First of all, small or new companies need investment capi-
tal or technology necessary for their development. In order to gain access
to resources, they may create an alliance with bigger, more mature
partners that are well-equipped with such resources. Such partners may
speed up the firm’s development and may participate in expensive, risky
projects. The firms may also gain access to new markets, where their

potential partners already exist (Martin, 2003). Martin (1997) also
indicates that large corporations may use strategic alliances to reduce
uncertainty and at the same time increase probability of success. More-
over, cooperating with competitors may foster the research and develop-
ment process, when partners share their valuable knowledge and expe-
rience. Finally, sometimes companies are simply forced to cooperate in
order to survive. This phenomenon frequently happens in industries
characterised by dynamic changes, knowledge and technology-inten-
siveness (Golonka, 2012). However, some scholars argue that coopetition
is not the best way of creating innovations because of the high risk of
potential knowledge leakage (Bayona, Garcia-Marco and Huerta, 2001)
or learning races (Inkpen, 2000).
Mohr and Puck (2013) pointed out that trust may positively affect
governance of alliances and lead to an improvement of confidence, de-
creasing the possibility of opportunistic behaviour of partners. Trust
increases the likelihood of common goals being more important than
private benefits. It also enhances cooperation, flexibility and shortens
the time of decision making, it enhances commitment and partner con-
tributions to the alliance.
Major Risks in Alliances
Although there are factors that improve partner protection in alliances,
partners may have their own goals related to the strategic alliance. This
generates risks that need to be categorised into two major types. First, the
risks related to the firm’s future. A partner may copy or create a similar
business model or steal key resources, which are essential for gaining com-
petitive advantage. For example, in the early stage of cooperation the part-
ners operate in different geographic markets, but after a few years they start
to compete with each other because of, inner alia, the internationalisation
process. A good example are the alliances of Japanese firms with their
Western partners in the 20th
century (Beck, Larson and Pinegar, 1996).
Second, the risks related to knowledge leakage, and learning
race. Learning race has been described in the literature as a process
heading for collapse. It starts when a company discovers that its partner
wants to gain only private benefits and his aim is to gain access to knowl-
edge. In this situation, once one firm has learned, it has no purpose
continuing the partnership and incurring the costs of the alliance (tak-

ing into consideration that there will be no more common benefits).
Being aware of that, the company which discovers the incentives of its
partner wishes to avoid being the ‘slower’ company in the learning race
(loser scenario), suffering from this alliance (Khanna et al., 1998). As
a result, companies start to compete in ‘fast learning’. Inkpen (2000)
points out that the real learning race requires the participants to ac-
knowledge being in a race, however the loser scenario described by
Khanna et al. (1998) may occur “as long as it is acknowledged that the
loser was probably never aware that a race was happening” (p. 5).
Knowledge leakage is a multidimensional construct concerning in-
tentional or unintentional outflow of knowledge in an alliance, going
beyond its scope. Leakages may encourage opportunistic behaviours of
partners and lead to a decrease of the company’s competitive advantage.
Moreover, if the partners operate in the same markets, knowledge leak-
age may cause even more problems, e.g. when a partner uses acquired
resources in order to compete in the same market. This situation may
occur in the above-mentioned learning race, where competing companies
try to absorb knowledge as fast as possible, irrespective of the price.
Understanding the potential consequences of knowledge leakages and
awareness of the described processes may be of crucial meaning for an
effective knowledge management in joint ventures. Knowledge leakages
are difficult to avoid in many situations, for example during joint research
on innovative products, or joint product development.
Corporate Entrepreneurship in Alliances
Corporate entrepreneurship is an organisational process that may im-
prove company performance (Zahra, 1993, Barringer and Bluedorn,
1999). “Entrepreneurial attitudes and behaviours are necessary for firms
of all sizes to prosper and flourish in competitive environments” (Bar-
ringer and Bluedorn, 1999, p. 421). There are three major types of cor-
porate entrepreneurship distinguished in the literature (e.g. Stopford
and Baden-Fuller, 1994, p. 521):
–– the creation of a new business within an existing organisation: cor-
porate venturing or intrapreneurship;
–– activity associated with the transformation or renewal of existing
organisations;
–– changing the ‘rules of competition’ for a given industry.

Different types of entrepreneurship may exist within the same com-
pany. However, some scholars argue that corporate entrepreneurship
might also be associated with:
–– company growth (Drucker, 1985; Stevenson and Jarillo, 1990);
–– innovation (Backman, 1983) and innovative initiatives within the
company (Jemielniak and Kozminski, 2011).
Initiative seems to even be perceived as a “key manifestation of cor-
porate entrepreneurship’ (Birkinshaw, 1997, p. 207). Initiative is a ‘dis-
crete, proactive undertaking that advances a new way for the corporation
to use or expand its resources” (p. 207). Furthermore, corporate entre-
preneurship is often associated with the attitudes of individual members
(managers and employees) within the organisation (Stevenson and Ja-
rillo, 1990).
As Brandt mentioned (Kuratko et al., 2014), “Ideas come from people.
Innovation is a capability of the many”. Corporate entrepreneurship may
be perceived as a process that can facilitate efforts to innovate and ef-
fectively deal with competitors. Companies enable corporate entrepre-
neurship, which is envisioned to be a process that can facilitate efforts
to constantly innovate. What is more, they deal with competitive reali-
ties much more effectively (Kuratko et al., 2014). As a result of active
attitudes of managers and employees entrepreneurial companies may
discover new opportunities and explore them. In order to create the right
conditions for corporate entrepreneurship, companies need to give au-
tonomy and freedom to their employees, so that they are free to pursue
actions and initiatives, regardless of the rules, and possible mistakes.
(Doubiene, 2013). This also applies to alliances, where sometimes it is
crucial to act independently from the existing strict corporate rules, or
to create new ways of cooperating with partners.
Creating alliances might be perceived in this context as an initiative
associated with the transformation or renewal of existing organisations,
sometimes also leading to a change of the ‘rules of competition’ in the
industry, aiming for company growth and the development of innovative
products. Moreover, one of the ways of reducing the described risks in
alliances, especially associated with knowledge leakages, might be in-
novative actions undertaken by the entrepreneurial managers or em-
ployees within the organisation.
What is even more interesting is that an alliance may be perceived
as corporate entrepreneurship, or a method for developing entrepreneur-

ial activity (Montoro-Sanchez et al., 2009). Alliances play a key role in
corporate entrepreneurship (Ireland et al., 2006), since interorganisa-
tional cooperation leads to, inter alia, the development of innovations.
There is a growing number of studies on entrepreneurship in alliances
in the field of management. For example, Sarkar et al. (2001) argue that
alliance entrepreneurship, namely alliance proactiveness (the extent to
which an organisation engages in identifying and responding to partner-
ing opportunities), positively affects the market performance of a com-
pany. The research findings of Montoro-Sanchez et al. (2009) show that
partner resources and skills are the most important assets when it comes
to the negotiation process between allies. Also Teng (2007) analysed
alliances and their impact on corporate entrepreneurship activities,
including innovation, corporate venturing, and strategic renewal. The
empirical study of Shu et al. (2014) entitled The Knowledge Spillover
Theory of Entrepreneurship in Alliances shows that partner knowledge
protection (which is regarded as a knowledge filter) can increase knowl-
edge spillovers in alliances.
PGNiG and its Alliances
PGNiG is the leader of the Polish natural gas and oil sector. The company
also operates in Libya, Pakistan, the Czech Republic, Denmark and in
Germany. PGNiG is listed on the Warsaw Stock Exchange and is one of
the largest Polish companies: the WIG20 index. What is more, the ma-
jor shareholder is the Polish government. The core activities of this
company include the exploration and production of natural gas and
crude oil (largest oil extractor in Poland), as well as sales, imports and
storage of gaseous fuel by the company branches. To show how big PG-
NiG is, it is best to present the company in terms of numbers for the year
2013. Their revenue was almost PLN 29 billion. The company extracted
1099 thousand tonnes of crude oil and almost 5 million cubic meters of
natural gas (PGNiG, 2013). Obviously, this company has a significant
impact in terms of providing a safety strategy in energy for the entire
country.
As a corporation, PGNiG has a broad alliance portfolio and also cre-
ates alliances in order to expand internationally. The company can be
considered proactive in identifying alliance opportunities, which is
characteristic of an alliance entrepreneurship (Sarkar et al., 2001). The
major alliances have been described below:

1. PGNiG – Tauron. The main purpose of this cooperation is develop-
ing a power plant in Stalowa Wola.
This alliance is perceived by the energy sector as a perfect coopera-
tion. As one of the interviewees said:
“This alliance is one of the best so far. Our negotiations were short
and we immediately started our cooperation.” (DPGNiG1
)
2. PGNiG Upstream International AS (subsidiary of PGNiG) – joint
venture consisting of many partners in the Norwegian continental
shelf.
3. PGNiG – Chevron Polska Energy Resources. Joint venture created
for joint research in the field of shale gas in Poland.
An alliance between PGNiG Termika and Tauron Wytwarzanie
has been created in order to establish the largest in Poland Combined
Heat and Power plant. This joint venture is owned jointly (50% by each
company). Both companies participating in the joint venture had the
intent to learn from each other about market and partner operations.
PGNiG’s contribution is natural gas for large customers (540 million
cubic meters of natural gas delivered annually). PGNiG Termika, sub-
sidiary of PGNiG, aims to expand to other market sectors. The partner
firm, Tauron, tries to diversify its activities, gain new overall electric
power and develop their own production capacity. Both cooperating
companies are also competitors at the same time.
DPGNiG: “We are competitors in some way. We both have know-how
in different markets
of the energy sector. Thanks to our cooperation we can actually learn
about our bad and good sides.”
PGNiG also invests in the Norwegian Continental Shelf Project.
For the purpose of this project, the Polish company has established the
joint venture PGNiG Upstream International AS. The main purpose
of PGNiG Upstream International is to explore and produce crude oil
as well as natural gas. PGNiG has also created several joint ventures
in other countries. For example, the company conducts work in Paki-
stan for hydrocarbon exploration (and production) with Pakistan
Petroleum LTD.
1
Director of Strategy and Growth in PGNiG, member of the Board of Directors.

DPGNiG: “Our main objective of establishing multiple joint ventures
with others is to reduce financial risks.”
The third alliance: PGNiG – Chevron Polska Energy Resources
seems to be very interesting because of its significance in developing
shale gas in Poland. It is believed that this natural gas may be a source
of competitive advantage of the country. Thus, this project has an es-
sential meaning not only for the company, but also for Poland and Poles.
PGNiG has bought concessions allowing exploration and started nego-
tiating cooperation with Chevron. The final agreement stated that both
companies are to create a joint venture (jointly owned, 50% each).
However, both companies had different aims while establishing this
alliance. The main objective for PGNiG was to share costs and risks.
Companies in the energy sector in the United States have much more
experience with shale gas, as it is one of the major sources of natural gas
in terms of gas volumes produced (U.S. Department of Energy, 2009).
This was the main reason for choosing Chevron: PGNiG could learn
from a more experienced international partner. As one of the members
of the board said:
DPGNiG: “With establishing this relationship, PGNiG would gain
a solid and experienced business partner (…), and we would be able to
draw on Chevron’s global experience in shale gas exploration and pro-
duction.”
In all of these alliances, the most important resource of the company
is knowledge, and the major goals are to share knowledge and learn from
the partners in order to increase company performance and innovative-
ness. In this context, the alliances may be considered as entrepreneurial
alliances for the partnering allies. At the same time, the managers face
a huge challenge, which consists in ensuring safety of their own company,
and maximising the value created in the process of cooperation with the
partners. Besides the mentioned knowledge leakage, managers have to
handle other, sometimes more extreme risks associated with the alli-
ances.
PGNiG – Identified Risks
Based on an analysis of the collected data, several major risks in PG-
NiG’s alliances have been identified. Each of them has been described
below:

Economic espionage
Firstly, it is important to define competitive intelligence – it is the effect
of gathering and analysing information, including e.g. information about
customers, products or information related to any aspect of company
operations. In other words, it means understanding the environment and
everything happening around the company (Entrepreneur.com, 2015).
The difference between competitive intelligence and economic es-
pionage is not clear. Scholars suggest that the boundaries are created by
the law, but others argue that the boundaries between legal and illegal
actions are blurred (Wright and Roy, 1999).
Economic espionage is strictly associated with knowledge leakage,
but in this situation, the partner performs activities with the aim to steal
information. Espionage could be defined in many ways. Galvin (2007)
argues that it refers to an analysis of information (concerning the mar-
ket, changes in the law system etc.), an analysis of the decisions of
government institutions (that may affect the firm’s industry), and also
forecasting based on the analysis in order to achieve competitive advan-
tage (Galvin, 2007). The interviewee said that every company is practic-
ing this tactic in order to be up-to-date every time.
DPGNiG: “This is not spying, we are following our competitors: their
activity, news etc. to sustain our proactive strategy and respond to every
environmental change as quick as it is possible.”
Espionage also refers to the process of purposefully obtaining infor-
mation concerning trade secrets, patents, know-how and any other
confidential data without permission of the owner, which may be inter-
national in scope (Nasheri and Hedjeh, 2005).
During the cooperation the energy companies might obtain various
information from their partners. Seven types of information were iden-
tified based on interview analyses:
• Information about the prices, discounts, terms of contract offered by
the partner to suppliers and other third parties;
• Information about the partner‘s technology, know-how and patents;
• Information about the capacity and potential of the partner’s plants;
• Information about the vendors of the partner’s raw sources and ma-
terials;
• Information about the partner’s sale strategy;
• Information about the problems that the partner faces in different
markets.

All those types of information may be obtained informally from people
working for the partner company, suppliers or major stakeholders. What
is more, the source of information can also be secondary, raw data (e.g.
stored in the company database). The data might be acquired and trans-
formed into useful information using dedicated IT tools. An example of
such a tool is Microsoft Upstream Reference Architecture (Hemps et al.,
2003), created specifically for analysing data in the oil and gas industry.
Criminal competitive intelligence activities
This is one of the most extreme methods of espionage, which involves
illegal and unethical behaviour. It could be breaking into senior execu-
tives’ homes or offices to steal confidential information. Correspond-
ingly, wiretapped phones or intercepting emails definitely breach the
criminal law. This requires special skills. However, if such activity is
spotted, the company breaching the law will lose its reputation forever.
A manager working for Statoil, another international energy company
in Poland, mentions the key IT-related risk for his organisation:
MSTATOIL2
: “Its sensitive information, for example as part of a bid-
ding process, to be disclosed by hacking. It is important to make sure
that the systems are working correctly.”
Moles
This is a less invasive method of obtaining confidential information.
According to statistics it is very likely to happen. While forming a joint
venture, firms create a separate entity consisting of employees from both
parent companies. One of the employees may be a spy, e.g. employed as
a top manager in the partner company. Another way is to corrupt exist-
ing employees in order to obtain valuable information.
DPGNiG: “This is one of the most neuralgic points in our company.
We had many unpleasant situations when employees were spies. We are
still developing our human resources management system, assessment
centres as well as new control methods.”
2
Manager in STATOIL, Poland

Rogue executives
A rogue executive might be placed very close to the management board;
the highest possible level of the corporate structure in order to influence
the company’s strategic decisions. By doing so, the company gets access
to a wide range of the partner’s key information, and might also exploit
the partner’s resources.
Insider threats and cybercrime
Companies mostly focus on threats coming from the external environ-
ment. However, huge organisations like Shell, for example, employ
92,000 people (in 2014). Obviously, some of them are also potential
threats to the company. In an alliance, employees – internals – are able
to see, manipulate or share company data. Those activities are (despite
less investigated) more common and could be equally damaging as ex-
ternal threats. It is worth highlighting that protection against internal
threats is not a priority of IT departments – monitoring and controlling
every employee may cause conflicts between the management and em-
ployees. Especially if trust and a friendly corporate culture are of major
importance within the company.
DPGNiG: “Every door has its key to unlock. Thankfully, our techni-
cians are one of the best professionals in the country, if not in Europe.”
Ernst &Young (2013; 2014) reported insider threats grouping them
into three main categories: theft of intellectual property, sabotage and
fraud. What is more, some of them might occur when the partner’s
employees share confidential information (access passwords etc.) with
someone else (e.g. a third party).
Over the past few years cybercrime in the energy sector has become
popular news. In a response to such threats, companies invest more and
more in IT security, but despite all of those efforts, they still suffer data
loss.
This may especially hurt the oil and gas industry, where companies
own remote land locations: offshore rigs, super tankers on the oceans.
All of those units have to be connected with each other. E&Y (2014)
reports that 61% of companies in the industry believe that they are
unable to detect IT attacks. Cybercrime can come in a variety of types,
but it is mostly about people who have different motivations and aims.
For example, a group of hacktivists may seek to ruin the reputation

of a company. To illustrate that, in 2012 the international hacktivist
collective Anonymous in their operation #OpSaveTheArctic exposed
email addresses and passwords from oil companies, including industry
giants like: Exxon Mobil, Shell, BP, Gazprom. Moreover, some cyber
criminals may seek information in order to get money. They obtain
giant amounts of analysed data and then convert it into money by
selling it to other companies. This may lead to losses in sales, strategic
partner hijacking, patent infringement, reduced return on R&D in-
vestments and so on. One of the most remarkable examples took place
on August 25th
, 2012: a virus attacked the computer network of Saudi
Aramco. According to reports it took two weeks to clean 30,000 com-
puters from the virus. Its main function was to delete data from
computer hard drives. It is worth mentioning that there were no oil
spills, explosions or other extreme situations, but some very important
information about drilling and production were lost (Bronk and Tikk-
Ringas, 2013).
Reducing the Risks of Knowledge Leakages
Most of the described threats result in a loss of crucial information and
knowledge leakages. As Shu et al. (2014) pointed out, protection against
knowledge leakages, namely knowledge filters, might increase knowledge
spillovers in entrepreneurial alliances. However, in order to avoid these
leakages, companies use several methods and mechanisms.
First of all, companies always draw up a framework agreement to
set the obligations of each party before they sign the partnership agree-
ment. Before creating a final agreement, there is a negotiation phase. In
this phase the companies discuss and agree on the future responsibilities
and obligations of each party. This phase seems to be crucial for future
cooperation.
DPGNiG: “Just after the negotiations we draft our letter of content.
We set out the obligations and other responsibilities for each party.
After that, we sign the principal and binding contract.”
The second key issue is the alliance management, as well as
people who will work for the alliance. PGNiG conducts training for all
employees in order to familiarise them with the possible restrictions
in the process of sharing information. They are simply taught what
they can and what they cannot say to a partner, or partners. Unfortu-

nately, it is not possible to prepare a written list or enumerative cata-
logue of the information that they can use. Thus, the managers play
a very important role in leading the employees and managing the al-
liance activities. Based on a silent rule, after successfully establishing
an alliance, the managers are transferred to the other one. The com-
panies believe that they are able to conduct alliances successfully based
on their managers’ experience. What is even more interesting, in the
most important and crucial alliances (so called ‘fragile alliances’), the
companies try to control the knowledge flows. In order to do so, they
create a special entity called the ‘gate keeper’. The gatekeeper is a sep-
arate, dedicated structure that answers every possible question of the
managers in case of any problem deciding whether particular informa-
tion may be shared.
One of the interviewed managers mentioned risk associated with the
process of selling, or outsourcing a part of the partner’s business (e.g.
one of the subsidiaries). In such a case, every party involved in the ten-
der is obligated to sign a non-disclosure agreement (NDA) in order
to protect confidential information. After signing the document, the
subsidiary receives a Memorandum of Association, consisting of a finan-
cial expertise, balance sheet and every other detail that describes the
condition of the organisation. Moreover, it is impossible to reveal the
details, because this might cause doubts about the firm’s economic con-
dition. However, there is still a possibility that among the companies
interested in buying a subsidiary, for example, there may be a ‘false’
company. Such a company might be registered in Luxembourg or Cyprus,
for example, where the legal environment does not force to define a clear
shareholder structure. Thus, the information collected by such a false
company may be secretly transferred to its “parent company” and then
used for their own purpose.
Taking into account that trust is a fundamental issue in alliances,
the company tends to recruit only trustworthy and experienced employ-
ees to its alliances.
DPGNiG: “Our companies train the staff in every aspect. We all
know that they are the ones who create our company and we believe that
the return on this investment is loyalty and trust.”
Experienced people have the knowledge about ‘how things are done
around here’, they know the company, how it works, operates, and what
kind of information is important and may be useful in alliances. The
Human Resources Department is constantly monitored.

Thanks to the innovative initiative of managers a special place designed
for strategic alliances, as well as for mergers and acquisitions (M&A), has
been created in order to protect information and to avoid knowledge leak-
ages. This place is called the ‘Data Room’. A data room is a place where
companies participating in an alliance store their copies of all the confi-
dential documents regarding the alliance. The documents cover all the
important issues: financial, legal, business, concerning the history of the
alliance, as well as future predictions. Every person entering this room
needs to sign a confidentiality agreement (NDA). Interestingly, there are
very strict rules describing how to behave, what partners may and may not
do while being in there. The rules depend on earlier agreements between
the partners. Usually, in the data room people are not allowed to write,
take pictures or make movies. All behaviours leading to the possibility of
recording anything in the room are strictly prohibited.
One of the interviewees explains his experience from a data room:
DPGNiG: “I had the opportunity to be in a data room. We were
talking with Lotos Petrobaltic about our joint operations and alliances.
We entered a big room, where the walls were made of glass, there were
cameras everywhere as well as guards. I felt hemmed in, but we were
sitting there for 5 hours with my friend from a competing company.”
The main objectives of such data rooms, which are often used in due
diligence processes in other companies, are (duediligencedataroom.com):
• Remove any concerns the potential alliance partners might have in
the company;
• Disclose all the data required or requested;
• Determine any potential costs;
• Identify business trends that could be used to decrease the potential
value of shares;
• Identify any potential opportunistic behaviour (for example, partner
might be seeking critical know-how in order to develop own projects);
• At the end of the analyses, the data room governor must ensure that
everything has been erased. Data rooms have their disadvantage: it
is impossible to erase a person’s memory about what he or she has
seen and experienced in such a room.
Managerial practice shows that data rooms are a very effective method
for every process when confidentiality of information is a major issue.
In PGNiG, the creation of such a room is an example of manager initia-
tive that has improved the security of alliances, as well as reduced the

risk of knowledge leakages in strategic partnerships. Thus, it may be
considered as another corporate entrepreneurial action undertaken in
existing alliances.
Questions
1. Which key company resources can be acquired during cooperation
with a direct competitor?
2. What methods and tools that help reduce knowledge leakages might
be useful in smaller firms? Do you think that the methods used in
PGNiG are really effective?
3. What entrepreneurial actions can be undertaken by managers in
order to establish and manage interfirm partnerships successfully?
4. What kind of cultural factors may affect the cooperation effective-
ness within a strategic alliance?
Recommended Readings
1. Casson, M., Buckley, P.J., Dark, K., Giusta, M.D., and Godley,
A. (2010). Entrepreneurship: Theory, Networks, History. Cheltenham:
Edward Elgar Publishing.
2. GulatiR.(2007).ManagingNetworkResources:Affiliation,andOther
Relational Assets. Administrative Science Quarterly, 52: 476-481.
3. Hofstede, G., Hofstede, G.J., and Minkov, M. (2010). Cultures and
Organizations: Software of the Mind. New York: McGraw-Hill Edu-
cation.
Bibliography
Backman J. (ed.) (1983). Entrepreneurship and the Outlook for America.
New York: Free Press.
Barringer B.R. and Bluedorn A.C. (1999). The relationship between
corporate entrepreneurship and strategic management. Strategic
Management Journal, 20: 421–444.
Bayona C., Garcia-Marco T. and Huerta T. (2001). Firms’ motivations
for cooperative R&D: An empirical analysis of Spanish firms. Research
Policy, 30(8): 1289–1307.

Beck J.C., Larson A.B., Pinegar J.M. (1996). The wealth effects of non-
equity alliances: the U.S.–Japanese licensing experience. Pacific-
Basin Finance Journal, 4: 393–408.
Bengston M. and Kock S. (2000). Coopetition” in Business Networks
– Cooperate and Compete Simultaneously. Industrial Marketing
Management, 29(5): 411–426.
Birkinshaw J. (1997). Entrepreneurship in multinational corporations:
the characteristics of subsidiary initiatives. Strategic Management
Journal, 18: 207–229.
Bronk Ch. and Tikk-Ringas E. (2013). The Cyber Attack on Saudi Ar-
amco. Survival: Global Politics and Strategy, 55(2): 81–96. Obtained
from https://www.iiss.org/en/publications/survival/sections/2013-
94b0/survival--global-politics-and-strategy-april-may-2013-b2cc/55-
2-08-bronk-and-tikk-ringas-e272 (16.03.2015).
Doubiene J. (2013). Corporate entrepreneurship in organizational life-
cycle. Economics and Management, 18(3): 584–595.
Drucker P. (1985). Innovation and Entrepreneurship: Practice and Prin-
ciples. New York: Harper & Row.
Galvin R.W. (2007). Competitive Intelligence at Motorola. Competitive
Intelligence Review, 8(1): 3–6.
Golonka M. (2012). Alianse, portfolia, sieci strategiczne, zarządzanie
relacjami. Management and Business Administration. Central Europe,
4(117): 61–62.
Gulati R. (1998). Alliances and networks. Strategic Management Journal,
19: 293–317.
Inkpen A.C. (2000). A note on the dynamics of learning alliances:
Competition, cooperation, and relative scope. Strategic Management
Journal, 21(7): 775–779.
Ireland R.D., Hitt M.A. and Webb J.W. (2006). Entrepreneurial alliances
and networks. In: J. Shenkar and J.J. Reuer (eds.), Handbook of stra-
tegic alliances. Thousand Oaks: Sage Publishers.
Jemielniak D. and Kozminski A.K. (2011). Zarządzanie od podstaw.
Warszawa: Oficyna Wolters Kluwer.
Johnson G., Scholes K., Whittington R. (2008). Exploring Corporate
Strategy. Text & Cases, VIII edition Essex: Pearson Education Limited.
Kuratko D.F. (2014). Entrepreneurship: Theory, process, practice (9th
ed.).
Mason, OH: South-Western Cengage.
Kuratko D.F., Goldsby M.G. and Hornsby J.S. (2012). Innovation ac-
celeration: Transforming organizational thinking. Upper Saddle River,
NJ: Pearson/Prentice Hall.

Lozano-Platonoff A., Rudawska A. and Pachciarek H. (2014). Koopety-
cja jako źródło tworzenia sieci międzyorganizacyjnych. In: A.K.
Koźmiński anf D. Latusek-Jurczak (eds.), Relacje międzyorganizacyjne.
Warsaw: Wolters Kluwer Polska.
Martin J.G. (2003). Growing Use of Strategic Alliances in the Energy
Industry. E&MLF Houston, Texas.
Mohr A.T. and Puck J. (2013). Revisiting the Trust-performance Link
in Strategic Alliances, International Management Review, 53: 269–289.
Montoro-Sánchez Á., Ortiz-de-Urbina-Criado M. and Romero-Martínez
A. (2009). The Decision to Use Alliances as Corporate Entrepreneur-
ship: The Role of Resources and Skills. Group Decision & Negotiation,
18(5): 431–448.
Nasheri, H. (2005). Economic Espionage and Industrial Spying. Cam-
bridge: Cambridge University Press.
Varadarajan P.R. and Cunningham M.H. (1995). Strategic alliances:
a synthesis of conceptual foundations. Journal of the Academy of
Marketing Science, 23(4): 297–300.
Sarkar M.B., Echambadi R.J. and Harrison J.S. (2001). Alliance Entre-
preneurship and Firm Market Performance. Strategic Management
Journal, 22(6/7): 701.
Shu C., Liu C., Gao S. and Shanley M. (2014). The Knowledge Spillover
Theory of Entrepreneurship in Alliances. Entrepreneurship: Theory
& Practice, 38(4): 913–940.
Stevenson H. and Jarillo J.C. (1990). A paradigm of entrepreneurship:
entrepreneurial management. Strategic Management Journal, 11:
17–27.
Teng B. (2007). Corporate Entrepreneurship Activities through Strate-
gic Alliances: A Resource-Based Approach toward Competitive Ad-
vantage. Journal of Management Studies, 44(1): 119–142.
Wright P.C. and Roy G. (1999). Industrial Espionage and Competitive
Intelligence: One You Do; One You Do Not. Journal of Workplace
Learning, 11(2): 53–59.
Zahra S.A. (1993). Environment, corporate entrepreneurship, and fi-
nancial performance: A taxonomic approach. Journal of Business
Venturing, 8: 319–340.

Reports
Ernst & Young Oil and Gas Report (2013). Business Pulse. Exploring dual
perspectives on the top 10 risks and opportunities in 2013 and beyond.
Ernst & Young report (2013). Authorized access: uncovering insider threats
within oil and gas companies.
Ernst & Young report (2014). Cyber threat intelligence – how to get ahead
of cybercrime. Insights on governance, risk and compliance.
Ernst & Young report (2015). Oil and gas cybersecurity: time for a seismic
shift?
Microsoft: Adam Hems, Adil Soofi, Ernie Perez (2003). Drilling for new
Business Value. How innovative oil and gas companies are using big
data to outmaneuver the competition. A Microsoft white paper. Ob-
tained from: http://download.microsoft.com/download/D/3/4/
D34E7DEE-3E2B-45AD-8B5E-40606F648610/DrillingforNew
BusinessValue_O-G_BIWhitepaper.pdf. (20.05.2015)
PGNIG (2013). Annual report 2013. Warsaw.
PGNiG (2014). Directors’ report on the operations of the PGNiG group
and PGNiG S.A. for H1 2014. Warsaw.
U.S. Department of Energy (2009). Independent Statistics & Analysis
U.S. Energy Information Administration: Top 100 oil and gas fields.
Websites:
Due Diligence Data Room, http://www.duediligencedataroom.com/
What-is-a-Data-Room.html (19.04.2015).
Entrepreneur.com (2015), Small Business Encyclopedia: Competitive
intelligence. Obtained from: http://www.entrepreneur.com/encyclo-
pedia/competitive-intelligence (20.05.2015).
Hoad, T.F. (2003), The Concise Oxford Dictionary of English Etymology.
Obtained from: http://www.oxfordreference.com/view/10.1093/
acref/9780192830982.001.0001/acref-9780192830982-e-
379?rskey=f39cLr&result=379 (19.05.2015).
Mcafee (2012): A Look at Key Hacktivist Events from Anonymous http://
www.mcafee.com/us/security-awareness/articles/key-hacktivist-at-
tacks-anonymous.aspx (16.03.2015).

Golonka

Recommended

Recommended

More Related Content

What's hot

What's hot (20)

Viewers also liked

Viewers also liked (19)

Similar to Golonka

Similar to Golonka (20)

Golonka