Analysis of co-operative interorganizational relationships, strategic alliance formation, and strategic alliance effectiveness

Abstract

Independent organizations collaborate to increase the competitive advantage of each organization. This paper develops a conceptual framework for defining and classifying co-operative interorganizational relationships. The features and differences between alternative co-operative interorganizational relationships are highlighted by the framework. One form of co-operative interorganizational relationship, a strategic alliance, is a means for organizations to gain competitive advantage in a product/market when environmental turbulence and diversity are high and the organization's skill and resource gaps are high. The subsequent discussion examines strategic alliances. The external and internal influences on alliance formation and the dimensions of the relationship that may impact alliance effectiveness are considered. Several propositions concerning effectiveness are formulated. The external and internal influences of alliance formation include internal structure and relationships, technology, and organizational performance. Propositions regarding alliance effectiveness are based on the dimensions of the relationship, including the power and dependence of the alliance partners, alliance planning processes, the extent of collaboration, and the commitment of the partners. Finally, several managerial and research implications of strategic alliance formation and effectiveness are considered.