This document summarizes literature on the contextual aspects of alliance partnerships versus alliance portfolios and their impact on business success. It discusses three main themes: 1) how collaboration through sharing resources, knowledge and social capital helps businesses succeed, 2) how factors of collaborative portfolios like industry experience, market position, linkages, functions and redundancy impact success, and 3) how contextual elements like market situation, management strategy, previous alliances and secondary contacts affect impact. It notes some inconsistencies in the research around whether individual partnerships or entire portfolios have a greater effect, and whether alliances are more successful focusing on knowledge or supplies. The document concludes there is a need for further research to resolve these inconsistencies and better understand the means of
THE INFLUENCE OF COLLABORATION IN PROCUREMENT RELATIONSHIPSijmvsc
Supply Chain Management often requires independent organizations to work together to achieve shared
objectives. This collaboration is necessary when coordinated actions benefit the group more than the
uncoordinated efforts of individual firms. Despite the commonly reported benefits that can be gained in
close relationships, recent research has indicated that collaboration attempts between purchasing firms
and their suppliers have not been as widespread as anticipated. Using a survey of procurement
professionals, this research investigates how the purchasing function utilizes collaboration in its supply
chain relationships. Structural equation modeling is used to identify how information sharing, decision
synchronization, incentive alignment, collaborative communication, and trust impact collaboration, as well
as how collaboration impacts performance. Results from 86 survey responses indicate that firms are still
not fully utilizing collaborative relationships
Brennan, Niamh [2006] Boards of Directors and Firm Performance: Is there an E...Prof Niamh M. Brennan
Reflecting investor expectations, most prior corporate governance research attempts to find a relationship between boards of directors and firm performance. This paper critically examines the premise on which this research is based. An expectations gap approach is applied for the first time to implicit expectations which assume a relationship between firm performance and company boards. An expectations gap has two elements: A reasonableness gap and a performance gap. Seven aspects of boards are identified as leading to a reasonableness gap. Five aspects of boards are identified as leading to a performance gap. The paper concludes by suggesting avenues for empirically testing some of the concepts discussed in this paper.
The Difference between Entrepreneurs and Managers in the Accumulation of Soci...ijtsrd
This paper difference between entrepreneurs and managers in the accumulation of social capital. The analysis for this study involved responses from 50 entrepreneurs and 50 managers in Vietnam. The research results shown three facts that support the predictions 1 social capital is higher among entrepreneurs, 2 the social capital of entrepreneurs rises with firm age, while such behavior is not observed for managers 3 entrepreneurs who invest in human capital also invest in social capital, while such correlation is not observed for managers. Dr. Le Nguyen Doan Khoi "The Difference between Entrepreneurs and Managers in the Accumulation of Social Capital" Published in International Journal of Trend in Scientific Research and Development (ijtsrd), ISSN: 2456-6470, Volume-5 | Issue-1 , December 2020, URL: https://www.ijtsrd.com/papers/ijtsrd38032.pdf Paper URL : https://www.ijtsrd.com/management/business-economics/38032/the-difference-between-entrepreneurs-and-managers-in-the-accumulation-of-social-capital/dr-le-nguyen-doan-khoi
The present study aimed to examine the effect of the entrepreneurial orientation (EO) on organizational performance (OP). This study was motivated by the mixed findings in literature regarding the relationships between EO and organizational performance. Owing to the mixed results, a novel stream of research was created and this motivated further examining of the impact of other variables that may shed a light on the nature of the relationship. Several theories have been proposed in literature posit the direct relationships among strategies, resources and capabilities as antecedents of success. In this study, copies of questionnaires were distributed to 300 Libyan banks branches, where 200 copies of questionnaires were returned and analyzed. The proposed hypothesis was tested through PLS-SEM and the study results showed that EO positively predicted organizational performance.
THE INFLUENCE OF COLLABORATION IN PROCUREMENT RELATIONSHIPSijmvsc
Supply Chain Management often requires independent organizations to work together to achieve shared
objectives. This collaboration is necessary when coordinated actions benefit the group more than the
uncoordinated efforts of individual firms. Despite the commonly reported benefits that can be gained in
close relationships, recent research has indicated that collaboration attempts between purchasing firms
and their suppliers have not been as widespread as anticipated. Using a survey of procurement
professionals, this research investigates how the purchasing function utilizes collaboration in its supply
chain relationships. Structural equation modeling is used to identify how information sharing, decision
synchronization, incentive alignment, collaborative communication, and trust impact collaboration, as well
as how collaboration impacts performance. Results from 86 survey responses indicate that firms are still
not fully utilizing collaborative relationships
Brennan, Niamh [2006] Boards of Directors and Firm Performance: Is there an E...Prof Niamh M. Brennan
Reflecting investor expectations, most prior corporate governance research attempts to find a relationship between boards of directors and firm performance. This paper critically examines the premise on which this research is based. An expectations gap approach is applied for the first time to implicit expectations which assume a relationship between firm performance and company boards. An expectations gap has two elements: A reasonableness gap and a performance gap. Seven aspects of boards are identified as leading to a reasonableness gap. Five aspects of boards are identified as leading to a performance gap. The paper concludes by suggesting avenues for empirically testing some of the concepts discussed in this paper.
The Difference between Entrepreneurs and Managers in the Accumulation of Soci...ijtsrd
This paper difference between entrepreneurs and managers in the accumulation of social capital. The analysis for this study involved responses from 50 entrepreneurs and 50 managers in Vietnam. The research results shown three facts that support the predictions 1 social capital is higher among entrepreneurs, 2 the social capital of entrepreneurs rises with firm age, while such behavior is not observed for managers 3 entrepreneurs who invest in human capital also invest in social capital, while such correlation is not observed for managers. Dr. Le Nguyen Doan Khoi "The Difference between Entrepreneurs and Managers in the Accumulation of Social Capital" Published in International Journal of Trend in Scientific Research and Development (ijtsrd), ISSN: 2456-6470, Volume-5 | Issue-1 , December 2020, URL: https://www.ijtsrd.com/papers/ijtsrd38032.pdf Paper URL : https://www.ijtsrd.com/management/business-economics/38032/the-difference-between-entrepreneurs-and-managers-in-the-accumulation-of-social-capital/dr-le-nguyen-doan-khoi
The present study aimed to examine the effect of the entrepreneurial orientation (EO) on organizational performance (OP). This study was motivated by the mixed findings in literature regarding the relationships between EO and organizational performance. Owing to the mixed results, a novel stream of research was created and this motivated further examining of the impact of other variables that may shed a light on the nature of the relationship. Several theories have been proposed in literature posit the direct relationships among strategies, resources and capabilities as antecedents of success. In this study, copies of questionnaires were distributed to 300 Libyan banks branches, where 200 copies of questionnaires were returned and analyzed. The proposed hypothesis was tested through PLS-SEM and the study results showed that EO positively predicted organizational performance.
THE IMPACT OF ENTREPRENEURIAL ORIENTATION ON STRATEGIC ALLIANCES’ FORMATION A...Mauro de Oliveira
Although entrepreneurship and alliances research fields provide valuable information on exploitation and knowledge
basis, the studies relating Entrepreneurial Orientation (EO) to Strategic Alliances (SA) formation remains limited. To the best of our knowledge, only five studies (Marino et al., 2002; Teng, 2005; Franco & Haase, 2013; Brouthers et al, 2014; Shu et al., 2014) related entrepreneurship to SA. However, these studies did not consider Lumpkin and Dess’ (1996) EO perspectives as a multiple construction, and these studies failed to consider how these two factors [EO and Top Management Team (TMT)] interact and influence SA. Overall, our belief is that large corporations and small and mediumsized
enterprises (SME) that effectively integrate EO to SA are well
positioned to continuously create wealth.
This study aims at examining the impact of the ownership structure on the overall performance of listed companies in Pakistan to specify how different ownership structures and corporate governance culture differ from each other and thus explores the effects of different ownership structures and corporate governance on the performance of companies’ productivity. In order to compare Returns on Investment (ROI) and Returns on Equity (ROE) of the five (5) listed food companies in Pakistan were calculated using secondary data from the audited financial reports of such companies based on their annual reports between 2007 and 2016. During this research for the analysis of gathered data, regression model was used with the assistance of EViews in order to examine the relationship between the corporate governance mechanism including board is size, board composition, and audit committee and the performance variables including Net Profit Ratio (NPR) and Rate of Return (RoR). The findings of the our study are consistent with the reviewed literature, as the performance of firms (in terms of return on assent and net profit ratio) does not seem to be dependent on the board size, composition, and audit committee composition of firms.
THE IMPACT OF ENTREPRENEURIAL ORIENTATION ON STRATEGIC ALLIANCES’ FORMATION A...Mauro de Oliveira
Although entrepreneurship and alliances research fields provide valuable information on exploitation and knowledge
basis, the studies relating Entrepreneurial Orientation (EO) to Strategic Alliances (SA) formation remains limited. To the best of our knowledge, only five studies (Marino et al., 2002; Teng, 2005; Franco & Haase, 2013; Brouthers et al, 2014; Shu et al., 2014) related entrepreneurship to SA. However, these studies did not consider Lumpkin and Dess’ (1996) EO perspectives as a multiple construction, and these studies failed to consider how these two factors [EO and Top Management Team (TMT)] interact and influence SA. Overall, our belief is that large corporations and small and mediumsized
enterprises (SME) that effectively integrate EO to SA are well
positioned to continuously create wealth.
This study aims at examining the impact of the ownership structure on the overall performance of listed companies in Pakistan to specify how different ownership structures and corporate governance culture differ from each other and thus explores the effects of different ownership structures and corporate governance on the performance of companies’ productivity. In order to compare Returns on Investment (ROI) and Returns on Equity (ROE) of the five (5) listed food companies in Pakistan were calculated using secondary data from the audited financial reports of such companies based on their annual reports between 2007 and 2016. During this research for the analysis of gathered data, regression model was used with the assistance of EViews in order to examine the relationship between the corporate governance mechanism including board is size, board composition, and audit committee and the performance variables including Net Profit Ratio (NPR) and Rate of Return (RoR). The findings of the our study are consistent with the reviewed literature, as the performance of firms (in terms of return on assent and net profit ratio) does not seem to be dependent on the board size, composition, and audit committee composition of firms.
Does labor–management partnership deprive union members ofac.docxjacksnathalie
Does labor–management partnership deprive union members of
activism toward their unions? Evidence from union members in Korea
Soon Sik Kwon*
Department of Business Administration, Changwon National University, Changwon,
Republic of Korea
This study aims to analyze whether partnership ideology really deprives union
members of the willingness and passion to act for their union, resulting in union
decline, and whether militant unionism, which includes adversarial ideology against
employers is more effective for igniting members’ activism for their unions rather than
labor–management partnership. The survey data were obtained from union members
working in Mechanical and Metal Manufacturers Complex, Changwon, Republic of
Korea. Judging from the overall results of the data analysis, Kelly’s (1996) claim that
moderate unionism based on partnership ideology would undermine members’
activism for their unions was not supported; on the contrary, partnership ideology had
positive effects on both members’ activism for their unions and decision-making
practices. The difference between partnership and militancy is that militancy had an
intensive effect on the narrow focus of union activities, but the impact of partnership
achieved a better balance between participation in union activities and in management
decision making.
Keywords: decision-making practices; labor–management partnership; union citizen-
ship behavior; union militancy; willingness to participate in union activities
Introduction
In prior researches concerning partnership, it has been very important to examine whether
partnership gives mutual gains to stakeholders like employers, labor unions and
employees. Criticism has been raised that such approaches, which are centered on
partnership outcome are separated from an understanding of their context, including the
corporate process and labor market conditions. Indeed, given the complexity of
partnership, it has been considered a myopic perspective to recognize partnership based
only on the outcome, but there is a need to understand more about the context, process and
drivers for partnership. Therefore, partnership has to be viewed as much more than a
quantitative labor–management outcome, and rather more broadly as an attempt to
reconfigure employment relations requiring more attention to internal behavioral
transformations and attitudinal improvements (Dietz 2004; Johnstone, Ackers and
Wilkinson 2009). Accordingly, this paper attempts to develop an understanding of
partnership-based approaches to employment relations that are more firmly grounded in
members’ attitude and behavior. This approach makes more of a contribution to
understanding the inner process of partnership, which is little known.
A lot of prior studies reflect case-based snapshots of partnership on the background of
such narrow, firm-level contexts that it becomes difficult to pick up generalized
propositions for partnership phenomena. For example, the ide ...
Factors Influencing the Growth of Venture CapitalIntroduct.docxmecklenburgstrelitzh
Factors Influencing the Growth of Venture Capital
Introduction
Many people dream of starting their businesses. There are several reasons why entrepreneurs would be willing to start their businesses. However, many of them get stuck because of a lack of capital since many financial institutions don't lend in the absence of collateral security. Some get lucky enough to get financial support from their savings or families and friends. But for others, there is only one alternative to obtain funds and start their businesses, and that is through venture capital. This is a part of private equity capital that is normally given for new start-ups that promise potential growth in the aim of getting a return on investment. In other words, venture capital investment is generally refers to cash in exchange for a share in the invested business.
Structure of Venture Capital
Venture capitalists (VC) refer to an investment firm or a person making venture investments. Apart from the issuance of capital, venture capitalists (VCs) also play a role in managing the business at an early stage, thus adding expertise skills. Kwak (2019) tells us that because there is a high risk of losing all investment in a given start-up company, most venture capital investments are done a pool format, where investors combine their portfolios into one large fund that invests in different start-ups. By doing this, they spread out risks hence improve their return on investments
According to Wallmeroth, Wirtz & Groh (2018), venture capital is generally used as a tool for economic development in underdeveloped countries. For the past few decades, venture capital has attained substantial growth especially in the developing economies where a considerable increase in economic activities has been observed of late. The main reason for this could be the search for different profitable markets that have gone through economic maturity, given that the developed markets have shown a slight decrease in profitability levels due to trade wars currently at play. Despite venture capital being widely disseminated worldwide, but the activity is mostly concentrated in America. In this paper, I will aim to understand the factors that drive the growth of venture capital.
Motives that drive Venture Capital
The venture capital market contains three elements namely management organization, capitalists, and invested corporations. In simplifying the dynamic market, capitalists invest their investments which are controlled by management organizations, which in turn, buy a stake in investment firms for a specified period (Maula, Autio & Murray, 2010).
· Organization Innovativeness
To clearly illustrate motives for venture capital, it’s essential to analyze the level of growth and development as a result of the effectiveness of measures at the organizational level. Generally, the organizations’ interest in creating venture funds has been largely influenced by the venture capital climate. Most companies gene.
Factors Influencing the Growth of Venture CapitalIntroduct.docxlmelaine
Factors Influencing the Growth of Venture Capital
Introduction
Many people dream of starting their businesses. There are several reasons why entrepreneurs would be willing to start their businesses. However, many of them get stuck because of a lack of capital since many financial institutions don't lend in the absence of collateral security. Some get lucky enough to get financial support from their savings or families and friends. But for others, there is only one alternative to obtain funds and start their businesses, and that is through venture capital. This is a part of private equity capital that is normally given for new start-ups that promise potential growth in the aim of getting a return on investment. In other words, venture capital investment is generally refers to cash in exchange for a share in the invested business.
Structure of Venture Capital
Venture capitalists (VC) refer to an investment firm or a person making venture investments. Apart from the issuance of capital, venture capitalists (VCs) also play a role in managing the business at an early stage, thus adding expertise skills. Kwak (2019) tells us that because there is a high risk of losing all investment in a given start-up company, most venture capital investments are done a pool format, where investors combine their portfolios into one large fund that invests in different start-ups. By doing this, they spread out risks hence improve their return on investments
According to Wallmeroth, Wirtz & Groh (2018), venture capital is generally used as a tool for economic development in underdeveloped countries. For the past few decades, venture capital has attained substantial growth especially in the developing economies where a considerable increase in economic activities has been observed of late. The main reason for this could be the search for different profitable markets that have gone through economic maturity, given that the developed markets have shown a slight decrease in profitability levels due to trade wars currently at play. Despite venture capital being widely disseminated worldwide, but the activity is mostly concentrated in America. In this paper, I will aim to understand the factors that drive the growth of venture capital.
Motives that drive Venture Capital
The venture capital market contains three elements namely management organization, capitalists, and invested corporations. In simplifying the dynamic market, capitalists invest their investments which are controlled by management organizations, which in turn, buy a stake in investment firms for a specified period (Maula, Autio & Murray, 2010).
· Organization Innovativeness
To clearly illustrate motives for venture capital, it’s essential to analyze the level of growth and development as a result of the effectiveness of measures at the organizational level. Generally, the organizations’ interest in creating venture funds has been largely influenced by the venture capital climate. Most companies gene ...
1. PARTNERSHIP VS PORTFOLIO
Challenging Contextual Aspects of Alliance Partnerships vs Alliance
Portfolios – A Literature Review
By: Bonnie Aylor, 2030815
For: BMGT7086, Fall 2014, Dr. Robert Schreck, Unit10A1
2. Partnership vs Portfolio – Literature Review Page 1 of 20
By: Bonnie Aylor, 2030815 Thursday, December 18, 2014
TABLE OF CONTENTS
TABLE OF CONTENTS ................................................................................................. 1
ABSTRACT....................................................................................................................... 3
INTRODUCTION............................................................................................................. 4
RESEARCH PROBLEM AND QUESTION ................................................................. 5
WHAT IS COLLABORATION?.................................................................................... 5
THEME # 1: COLLABORATION HELPS BUSINESS TO SUCCEED.................... 7
Sharing resources.......................................................................................................... 7
Sharing knowledge........................................................................................................ 7
Sharing social capital.................................................................................................... 8
THEME #2: COLLABORATIVE PORTFOLIOS IMPACT SUCCESS ................... 8
Industry Experience...................................................................................................... 8
Entrant v. Industry Incumbent ................................................................................. 10
Link v. Scale ................................................................................................................ 10
Function v. Resource .................................................................................................. 11
Portfolio redundancy v. singular redundancy.......................................................... 12
THEME #3: CONTEXTUAL ELEMENTS EFFECT THE IMPACT ..................... 12
Market situation.......................................................................................................... 12
Management strategy ................................................................................................. 13
3. Partnership vs Portfolio – Literature Review Page 2 of 20
By: Bonnie Aylor, 2030815 Thursday, December 18, 2014
Number of previous alliances..................................................................................... 14
Secondary contacts...................................................................................................... 14
INCONGRUENT TO OUTSTANDING CONSENSUS ............................................. 15
Knowledge v. Supply .................................................................................................. 15
Market uncertainty..................................................................................................... 15
Stage of market doesn't matter.................................................................................. 16
THESIS............................................................................................................................ 16
CONCLUSION ............................................................................................................... 17
References......................................................................................................................... 19
4. Partnership vs Portfolio – Literature Review Page 3 of 20
By: Bonnie Aylor, 2030815 Thursday, December 18, 2014
ABSTRACT
Businesses use several methods in order to compete with other market players. One such
method that businesses use is to enter into collaborative relationships with other market
contenders. These contenders may be of the same industry or an entirely different industry. The
alignment of these individual partnerships as alliances conglomerated into a multi-alliance
portfolio can have a significant baring on the overall success of the business. Businesses share
resources, knowledge and social capital that use the portfolio structure and other contextual
elements of alliances to determine the outcome of the businesses success.
While research does prove that these collaborative relationships do exist, and that
portfolio factors and contextual factors relate directly to success of the collaboration, there are
some discrepancies in the data. For instance, different authors have conducted research that
prove that either the individual partnership or the entire portfolio of alliances have the greater
effect of success. Researchers have noticed that time of entry into collaboration does have an
effect on success while others have noticed that there is no real effect. Some researchers have
proven that market vulnerability effects success while others have proven that vulnerabilities can
be cured through other aspects of the collaboration body, including other contextual elements
and alternate portfolio dynamics. Finally, researchers have not been able to come to consensus
about whether collaborative relationships are more successful geared around supplies or
knowledge. These inconsistencies warrant a need for further research into the topic of means of
success for collaborative bodies.
5. Partnership vs Portfolio – Literature Review Page 4 of 20
By: Bonnie Aylor, 2030815 Thursday, December 18, 2014
INTRODUCTION
In today’s times, process improvements and constant innovations, combined with a fast
growing array of different technological devices like computers, sensors, even smartphones,
means that the business market is becoming increasingly competitive. There are many different
measures that businesses can engage in so that management can actively participate in the
creation of success for the individual organization’s operations. One activity that businesses tend
to use to as an aid in constructing a successful outcome is that of collaborative alliance formation
(Eisenhardt & Schoonhoven, 1996). Research has discovered that collaborative practices have
indeed contributed to business success (Dussauge, Garrette, & Mitchell, 2000). However, it has
also been found that the portfolio of alliances that one business is involved in contributes to the
ability for single alliances to create success – the entire set of alliances combined effects the
success of two partners engaging in the alliance amidst that portfolio (Lavie & Singh, 2012).
Furthermore, data shows that the contextual aspects of the alliance partnerships, such as the type
of product or services used or the management system involved, have an impact on the success
of that alliance at all levels. These contextual aspects are described as single characteristics of
the alliances that are individualistic and are a part of how the alliance is formed or carried out
that may have either a direct or indirect impact on the individual alliance and other direct
elements that contribute to the alliance success (Lavie & Singh, 2012).
There are a specific set of contributing factors to the success of an alliance portfolio and
its individual alliances. These factors could related to the time of formation, the amount of other
similar partners in the alliance, the reason for the relationship, and other similar aspects of the
portfolio collage. Aside from these factors, there is also an integral effect that the overall
portfolio has in general on the individual alliances within it. Contextual components also
provide a specialized effect over the individual alliance through impacting either the portfolio of
6. Partnership vs Portfolio – Literature Review Page 5 of 20
By: Bonnie Aylor, 2030815 Thursday, December 18, 2014
alliances or that individual alliance itself. Each alliance interacts between the intermediate
partner and the full alliance portfolio to determine an outcome. An alliance collaboration
contains various elements that make-up its successful body, including specific elements that
define it as a unit containing partnerships, alliances, and alliances portfolios. However, there are
inconsistencies in the literature surrounding collaborations, such as in regards to the type of
resource sharing that is most beneficial, the effect of the single partnership over the portfolio,
and the condition of the market during collaborative efforts which each have an effect on the way
that alliances are conducted as protective mechanisms. These inconsistencies can be used to
propose a new research thesis.
RESEARCH PROBLEM AND QUESTION
In researching different aspects of productive business processes, and business
innovations, one prevailing concept has established itself through many topics of literature - the
collaborative business atmosphere. This same topic comes to mind when considering ways to
invite productivity in planning for overseas business expansion. Therefore, it becomes
imperative to develop a greater understanding of how collaborative business practices work, and
what elements of collaborative exchanges create a successful business outcome. The research
question this becomes - What elements are needed to create a coherent business collaboration
and what factors of the collaboration tend to determine a productive outcome?
WHAT IS COLLABORATION?
In order to even begin to study the research problem, it is important to understand what
collaboration is in the business atmosphere. For the context of this research, collaboration can be
defined as the interaction of one focal firm between its individual partnerships and collaborative
alliances. According to Lavie & Singh (2012), an alliance occurs when a business enters into
partnership in order to share resources, marketing, knowledge, and social capital. Singh &
7. Partnership vs Portfolio – Literature Review Page 6 of 20
By: Bonnie Aylor, 2030815 Thursday, December 18, 2014
Mitchell (2005) also see an alliance as an agreement between businesses to share their
experiences for the trading of resources and knowledge. However, Singh & Mitchell (1996)
further describe a partnership as the individual agreements related to a single resource, marketing
agenda or social capital. Cui & O’Conner (2012) depict a partnership as the single relationship
related to sharing between businesses that can be either diverse or redundant, but not both –
whereas an alliance involves multiple interactions that can take on both characteristics.
While these partnerships are imperative in their individual form, they can also share
resources and join together in multiple unions to become alliances. These partnerships can be
affected by the mix of resources across alliances so that it may or may not contribute to the
success of the individual partnership (Dussauge, et al. 2000). These interactive relationships
insinuate the existence of an alliance portfolio that is a factor of collaboration. An alliance
portfolio is the group of individual partnerships held by a business that may or may not be joined
together in a single alliance but that effect the success of an individual partnership indirectly as a
group (Cui, 2013). There are the factors of the individual partnership that deal with the
immediate need, and then the factors of the full alliance portfolio that deal with would could be
immediately required, but definitely will be needed at some point in the future.
The combination of alliances within the alliance portfolio have a major effect on the
strength of a business’s entire collaborative program, and could have a life or death effect on the
individual partnership within the portfolio. However, these portfolio can change overtime with
partnerships leaving and entering the portfolio at any time in order to increase the effectiveness
of the full portfolio (Lavie & Singh, 2012). These changes move around the individual
partnerships in a manner that is supposed to strengthen the effectiveness of each individual
alliance, enhancing the value of the portfolio. The alliance portfolio could have a direct effect on
8. Partnership vs Portfolio – Literature Review Page 7 of 20
By: Bonnie Aylor, 2030815 Thursday, December 18, 2014
the outcome of an individual partnership by providing alternative avenues for gathering
resources and supplies or through the reshaping of information and through the creation of
boundaries and guidelines in contracts related to the partnerships of the portfolio. The portfolio
can also determine whether or not a business is even willing to enter into partnerships with
another business due to the nature of each alliance. The strength of the outcome of a partnership
or single alliance will determine how long a portfolio remains unchanging.
THEME # 1: COLLABORATION HELPS BUSINESS TO SUCCEED
Sharing resources
Although there may be some inconsistencies, the literature has found that collaborative
practices help businesses to succeed. Businesses use collaborations so that they can save on
financial expenditures or obtain a greater reach with their marketing practices. For instance, a
small business might provide a low cost production service to a large corporate value chain and
gain good word from the large corporation with its name listed in product specifications. Many
times businesses will enter the collaboration in order to obtain resources during episodes of
vulnerability, where it is easier to collaborate then to try something individually (Eisenhardt &
Schoonhoven, 1996). Sometimes the business can become dependent on this sharing of the
resources and will do what needs to be done in order to keep the collaboration in place (Singh &
Mitchell, Partnerships, 1996). At other times, a business will use new partnerships for shared
resources in order to dissolve the dependence on the original partnership (Singh & Mitchell,
Partnership, 1996). Regardless of the reason for entering into the collaboration, the sharing of
resources has proven beneficial between partner organizations.
Sharing knowledge
The ability to share and gain knowledge from other collaborative alliances has proven to
be beneficial to doing business within a collaborative atmosphere. For this reason, businesses
debate over diversity in their portfolios and the type of diversity that should be administered so
9. Partnership vs Portfolio – Literature Review Page 8 of 20
By: Bonnie Aylor, 2030815 Thursday, December 18, 2014
that they can trade knowledge (Cui & O’Conner, 2012). This is because diversity tends to mix
different pieces of knowledge, enhancing the overall resource gain (Cui, 2013). This knowledge
sharing is advantageous because it contributes to innovation, evolving the firm’s contribution to
the industry and society (Dussauge, et al. 2000). This knowledge sharing can help a business
survive through situations such as market shock because the business will be more prepared to
compete around the shock (Singh & Mitchell, Environmental Shock, 1996).
Sharing social capital
The sharing of social capital within alliances offers one other way to benefit from
collaboration. According to research conducted by Eisenhardt & Schoonhoven (1996),
companies that hired management that had experience in collaboration and had contacts through
this experience were more likely not only to survive, but to also engage in future collaborative
practices – the contacts obtained through experience serving as a form of social capital. Lavie &
Singh (2012) found that businesses that had outside contacts aligned before market failure, and a
greater level of marketing related alliance partners, were more likely to survive the failure than
those without. Singh & Mitchell (Environmental Shock, 1996) also found that businesses were
more likely to survive a market shock with collaborative partnerships in place related to market
commercialization, which entails greater access to other network constituents that can become a
form of social capital. Finally, Singh & Mitchell (2005) found that businesses were more likely
to even be able to have found alliance partnerships when they already had alliance partnerships
in place that could offer them the social capital required to build collaborative trust.
THEME #2: COLLABORATIVE PORTFOLIOS IMPACT SUCCESS
Industry Experience
Even though inconsistencies do exist and collaboration has proven time and again to
benefit a business towards success, the individual contextual components of the alliance portfolio
have an impact on the ability for the collaborative practices to be beneficial. One factor of the
10. Partnership vs Portfolio – Literature Review Page 9 of 20
By: Bonnie Aylor, 2030815 Thursday, December 18, 2014
portfolio that can have such an impact is the amount of experience in the industry that is
displayed throughout the portfolio. Singh & Mitchell (2005) found that businesses were more
able to gain collaborative partners when they were showing a continuous growth in sales as well
as a continuous pattern of successful partnership agreements with other firms showing good
growth factors – hence they were displaying a pattern of successful experience in the market, not
only among themselves but also among their entire portfolio. This experience displays a sort of
exponential effect through both direct and indirect influence, in top and bottom positioning, for
maintaining healthy future alliance portfolios. Although Cui & O’Conner (2012) found that
diversity of resources is most beneficial for innovation due to the sharing of knowledge capital,
they also found that greater experience with collaborative factors could overcome that
component and offer greater success in areas like functional heterogeneity across the portfolio - a
factor determined to create complication to an alliance portfolio without this experience.
Therefore portfolios should be intermixed with highly experienced alliances as well as newly
knowledgeable market entrants.
Other researchers also found that experience contributed to dominant behaviors in an
alliance arrangement, as well as the ability to find new partnerships. Dussauge, et al. (2000)
found that the ability for a link alliance to reorganize or overtake the partnership agreement
occurred after experience with the collaboration offered a gain in knowledge that contributed to
the ability to reorganize or takeover the partnership resources – thus contributing to the
knowledge capital of the entire portfolio. The experience provided dominance after knowledge
was obtained, allowing the alliance to dissolve with the gaining partner being able to take over
the activities of both businesses. Finally, Eisenhardt & Schoonhoven (1996) found that
maintaining a management team with leaders that are experienced in collaborative practices
11. Partnership vs Portfolio – Literature Review Page 10 of 20
By: Bonnie Aylor, 2030815 Thursday, December 18, 2014
created an atmosphere that favored alliance activity. These management professionals were
more knowledgeable of the ins and outs of collaborative practices as well as more likely to have
gained contacts in the collaborative atmosphere that could help with alliance formation. These
portfolio partners provided a delicate resource of secondary contact during market turmoil across
the entire alliance (Eisenhardt & Schoonhoven, 1996). Thus, the benefits of experience with
collaborative business can take a new enterprise even father within the alliance atmosphere.
Entrant v. Industry Incumbent
It is important to consider the differences in the use of collaboration with a business at
entrance into the market as compared to collabroation with industry incumbents as a major
contextual element of collaborative business, especially when first entering the market. Just as
collaborations will benefit more from experienced players in the portfolio, entrants wishing to
partner for collaborative enterprise are more likely to survive when collaborating with industry
incumbents rather than other market entrants (Singh & Mitchell, 2005). It is noted that these
sorts of businesses are also more likely to gain a growth in sales aspects and, in effect, gain other
collaborative partnerships. Eisenhardt & Schoonhoven (1996) found that businesses wishing to
enter into a market will often lean on these incumbents in order to provide resources such as
market capital and social capital that cannot be obtained just by entering the market. They also
found that businesses entering a market will be more likely to survive and gain partnerships for
collaborative efforts if they have management that has already gained experience through similar
work in the industry because potential partners are more able to trust that the firm will succeed.
Link v. Scale
There is a considerable argument about the effects of link verses scale alliances for
predicting the final outcome of an alliance relationship. It is provided that alliances that are
formed in order to share knowledge resources, such as link alliances, are more likely to survive
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than alliances that are formed on the basis of economies of scale (Dussauge, et al. 2000). This is
mostly when the factor used to judge survival has to do with the outcome of the collaboration.
For knowledge based alliances, usually one firm will reorganize the partnership and the
partnership will stay in the state of the reorganization, or the knowledge gaining partner will
eventually take over the other (Dussauge, et al. 2000). However, the scale economy may either
remain in the same state as when it was formed because the partners become dependent on the
benefits of the alliance in that original state, or it will quickly dissolve due to misinterpretation of
the actual resource being shared before the alliance formed (Dussauge, et al. 2000). This
continuous sharing of the resource in its original state is not considered as successful as even a
reorganization because there is no change in circumstances after the alliance is formed, and the
businesses have an increased dependency factor due to the collaboration. Hence, if the
relationship were to dissolve, that dependency factor could slow processes of the individual
organizations involved.
Function v. Resource
Portfolios can be positively affected by the differences between the outcomes of
resources dependent collaborations verses functionally dependent collaborations. Singh &
Mitchell (Environmental Shock, 1996) found that resource diversity is important for overcoming
a market shock because the greater the number of partnerships with diverse resources, the least
likely that one partnership related to a market shock will be able to effect the survival of all of
the businesses involved. This effect may be due to the increased survival of firm innovation
when resource diversity allows for a gain in knowledge capital (Cui & O’Conner, 2012).
Sometimes this increased knowledge gain will allow one alliance partner to overtake another in
the partnership due to a shared agreement for such benefit to take place (Dussauge, et al. 2000).
In effect, the remaining partner will need more diversity of resources throughout its own
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individual portfolio, with a redundancy of functional attributes, in order to survive through a
reorganization of partnerships once that partnership dissolves (Lavie & Singh, 2012).
Portfolio redundancy v. singular redundancy
The amount of similar verses dissimilar resources contained in an alliance portfolio
would have a significant effect on the outcome of collaboration. This aspect clearly depicts
factors of similarity between single partnerships compared to those between full alliance
portfolios. It is discovered that singular dissimilarity could contribute to synergy among
alliances due to the gain in knowledge through these partnerships (Cui, 2013; Dussauge, et al.
2000). However, while this may be true, it is also important to maintain factors of similarity
throughout the alliance portfolio in order to protect against the early termination of individual
portfolios (Cui, 2013). Such redundancy provides a greater portfolio of reliance in the face of
resource specific market shock (Singh & Mitchell, Environmental Shock, 1996). It also may be
a cause of the increased level of market weight one partner can maintain over another in
partnership negotiations when resources are found through multiple alliance sources (Lavie &
Singh, 2012). This is because redundancy of resource partnerships means that one partner can
easily transfer indirect relations with one partner into more direct relations when another direct
partnership exercises too much supplier power. So while it is important to maintain diversity of
knowledge integration in individual partnership creation, the overall portfolio of partnerships
should display some redundancy of resources in order to safeguard against complications.
THEME #3: CONTEXTUAL ELEMENTS EFFECT THE IMPACT
Market situation
While it is true that a collaborative atmosphere may be beneficial to a business just for
the very usefulness of an alliance, and that the alliance portfolio has a good bearing on the
success of the collaboration, and amidst some inconsistencies; the data indicates that there is still
one other component that has an effect on the success of partner relations – the kaleidoscope of
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contextual elements within the alliance. One such contextual element has to do with the situation
of the market at any specific time during the collaborative relationship. Lavie & Singh (2012)
found that market conditions are a main driving force related to the way that alliance portfolios
evolve. Singh & Mitchell (Environmental Shock, 1996) found that entering into large numbers
of alliance could create complexity for the focal organization except when considering the effect
of multiple alliances during market shock – which will harm the business most if the resources
related to the partnership are also directly related to the market shock. Although Cui &
O’Conner (2012) found that resource diversity is most contributory to the success of business
through collaboration, they also found that functional heterogeneity is important during market
failure and that resource redundancy will assist in retaining resources as the firm continues to
function past such market failure. However, Eisenhardt & Schoonhoven (1996) found that one
discretionary principle regarding the formation of alliances during market vulnerabilities is that
when management teams have a large amount of combined experience on the market,
vulnerability may not be a contributory factor to alliance formation.
Management strategy
Incorporated general management strategies in an organization with guidelines related to
the management of alliances could benefit towards the success of a collabroation. In Lavie &
Singh’s (2012) study regarding the evolution of business portfolios, it was found that when one
partner clings to another outside of the individual partnership, the harmful effects of that clinging
from one business partnership to another tended to balance out when the alliance portfolio was
being managed efficiently before the partner began to cling. Furthermore, Singh & Mitchell
(Environmental Shock, 1996) found that the effects of market shock on diverse resource
portfolios when the shock was directly related to a single resource were reduced, and sometimes
even nitrified, when the portfolio was being managed effectively. Singh & Mitchell
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(Partnerships, 1996) found that portfolio management has the capability of arranging alliance
portfolios in such a way that partner dissolution will not affect the success of the focal firm. Cui
& O’Conner (2012) also found that the effects of functional diversity on intellectual resources
sharing are most beneficial with portfolio management practices in place.
Number of previous alliances
One contextual element that seems to be unanimous towards the success of a
collaborative relationship has to do with the number of previous alliances a focal firm has been
involved in. Singh & Mitchell (Partners, 1996) found that the effects of partner dissolution are
deeply lessened the greater the level of experience that the focal firm has with alliance
partnerships. In another study, Singh & Mitchell (2005) also found that the greater the number
of alliances a business has, the greater chance that they will be able to gain new alliances that
could increase their chances of success. Cui (2013) found that the greater the number of
alliances maintained previous to a partnership, and the level of redundancy thereof, could
negatively affect the chances of alliance termination after the partnership is active. Eisenhardt &
Schoonhoven (1996) also found that the greater the number of previous alliances that
management teams have dealt with, the greater chance that the firm will engage in future
alliances.
Secondary contacts
Finally, businesses that have a significant number of secondary contacts are more likely
to succeed in a collaborative atmosphere than businesses that do not. Singh & Mitchell,
(Environmental Shock, 1996) found that engaging in alliances secondary to the resource directly
involved with the shock would allow the business to continue to succeed in face of the shock. In
a different study the same year (Singh & Mitchell, Partnerships, 1996) they found that having
secondary contacts in the market would allow a business a greater chance of realigning
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partnerships when immediate partnerships dissolved, increasing their chance of survival. Cui &
O’Conner (2012) found that although resource diversity contributes to the success of firms
regarding knowledge resources, creating redundancy through secondary contacts will allow a
business to succeed through partnership failure. Furthermore, Eisenhardt & Schoonhoven (1996)
also found that the reason that larger numbers of management team members with alliance
experience can contribute to the success and formation of new alliances is because of the ability
to maintain secondary contacts in the market for building such alliances.
INCONGRUENT TO OUTSTANDING CONSENSUS
Knowledge v. Supply
Although the data on alliances was comprehensive, there were still some incongruences
throughout the data that need further mentioning. First of all, the consensus regarding the type of
resource, knowledge based or supply based, that is shared across an alliance that is bound to
create success for the businesses involved varied among researchers. While Dussauge, et al.
(2000) believe that knowledge base sharing is important in order to create innovation and
compete between other industry players through differentiation, Singh & Mitchell
(Environmental Shock, 1996) believe that some redundancy of resources is important to
overcome market shock – hence the need for scaled economy type alliances. Furthermore, Cui
(2013) believes that scale economies are important in order to safeguard against termination of
partnerships while Cui & O’Conner (2012) show that resource diversity is important in
collaborative activities in order to enhance information sharing, while functional heterogeneity
could be harmful except for in instances where management of finances are required.
Market uncertainty
A second inconsistency in the data has to do with market uncertainty. While Eisenhardt
& Schoonhoven (1996) found that market uncertainty is a derivative of alliance formation, Cui
(2013) found that market uncertainty could be a barrier to alliance formation. However, Cui &
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O’Conner (2012) found that market uncertainty can be managed through redundancy of some
resources and functional similarity. Lavie & Singh (2012) see it a different way, they found that
market uncertainty causes evolution of portfolio design, but does not directly affect alliance
formation.
Stage of market doesn't matter
A final inconsistency has to do with the stage of the market in relation to the success of
alliances after formation. According to Eisenhardt & Schoonhoven (1996), the stage of the
market does not matter, the success of an alliance relies more on the need for alliance and the
experience and social capital gained by management before alliances were formed. Basically,
market stage is not able to effect the market once other factors contributing to alliance formation
and success are taken into consideration. However, Singh & Mitchell (2005) found differently.
They found that the mere formation of alliances and then the success of such depends on the
ability to form alliances early on – at entrance into the market. This is because alliance
formation depends heavily on the successful formation of alliances previous to any particular
partnership.
THESIS
Throughout the material there were a few different inconsistencies. There was one
inconsistency that remained as a major theme throughout each document in the material. This is
in relation to the type of resource being used – knowledge v. supply resources. This goes even
deeper when examining whether diversity of the resource effects the alliance more or if diversity
of functions between alliances more greatly affect the success of the alliance. The research
thesis left to be studied is in regards to the type of resource. The thesis shall be stated as such –
Alliance portfolios should be managed so that knowledge based resources across individual
partnerships remain diverse while supply resources remain with slight redundancy in order to
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create a scaled economy that will last through market uncertainties, while the functional situation
between partnerships does not have an effect on this outcome as long as methods for conducting
the alliance coincide. The research will also define specifically the difference between
knowledge based and supply based resources, and will explain a difference between the effect of
primary and secondary partnerships.
CONCLUSION
There are many ways in which businesses seek to adapt to markets in order to survive.
One of these techniques involve the use of collaborative enterprise. Multiple researchers have
found that collaborative business provides sufficient benefit to individual business, and some
have even found that it provides its most beneficial value from the start of the business onwards.
However, the success of the collaboration depends on the alliance portfolio as well as the context
of the alliance. The portfolio relationship has to do with the types of resources that are shared
and the functional attitudes of each individual business belonging to the portfolio. Contextual
aspects have to do with the indirect elements of the relationship – such as market conditions,
collaborative experience of those making decisions, time in the market, and management
functions towards the alliance. All of these separate factors can combine to make the difference
regarding whether or not collaborative business truly effects the value of an entity entered into
the collaborative agreement.
However, researchers have found inconsistencies in the data regarding what factors are
most conducive to the success of these collaborative relationships. One such contextual element
has to do with the type of resource used in the alliance – knowledge based or supply based. This
contextual element suggests the need for further research to determine exactly how such resource
allocation effects alliance success, and whether or not functional heterogeneity will contribute to
the effect. Secondarily, research needs to define if there is the same effect when dealing with
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primary alliances as compared to secondary. At the conclusion of such research, evidence
regarding how to make successful collaborations will be of major benefit to businesses looking
to enter into the collaborative marketplace.
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REFERENCES
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Resource Dissimilarity. Journal Of Marketing, 77(3), 15-32.
Cui, A., & O'Connor, G. (2012). Alliance Portfolio Resource Diversity and Firm Innovation.
Journal Of Marketing, 76(4), 24-43. doi:10.1509/jm.11.0130
Dussauge, P., Garrette, B., & Mitchell, W. (2000). Learning from competing partners: Outcomes
and durations of scale and link alliances in Europe, North America and Asia. Strategic
Management Journal, 21(2), 99. Retrieved from
http://search.proquest.com.library.capella.edu/docview/225011571?accountid=27965
Eisenhardt, K. M., &Schoonhoven, C. (1996). Resource-based View of Strategic Alliance
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Lavie, D., & Singh, H. (2012). The evolution of alliance portfolios: the case of Unisys. Industrial
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Mitchell, W., & Singh, K. (1996). Survival of Businesses Using Collaborative Relationships to
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Singh, K., & Mitchell, W. (1996). Precarious Collaboration: Business Survival after Partners
Shut Down or Form New Partnerships. Strategic Management Journal, 1799-115.
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Singh, K., & Mitchell, W. (2005). Growth Dynamics: The Bidirectional Relationship between
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