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Attacking your partners: Strategic alliances and competition between partners in product markets

Author

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  • Victor Cui
  • Haibin Yang
  • Ilan Vertinsky

Abstract

Research Summary: This study contributes to the literature on strategic alliances by examining the impact of collaboration on competition between partners in product markets. We integrate the alliance learning and social network perspectives to examine how different combinations of exploratory and exploitative alliances between a firm and its partner influence the firm’s competition against its partner in product markets. Using a longitudinal dataset collected in the U.S. pharmaceutical industry (1984–2003), we find an inverted U‐shaped relationship between relative exploration (i.e., the proportion of exploratory alliances in the collaborative portfolio between a firm and its partner) and the firm’s competition against its partner. This relationship is negatively moderated by firms’ relational and structural embeddedness, but positively moderated by their positional embeddedness. Managerial Summary: This study examines how different combinations of exploratory and exploitative alliances between two firms affect their competition in the product market. Using a 20‐year dataset collected in the U.S. pharmaceutical industry, we find that the proportion of exploratory alliances (i.e., joint development of critical innovations) in the alliance portfolio between a firm and its partner increases the firm’s competition against its partner, up to a tipping point at which such competition starts to decline. Given a certain combination of the two types of alliances, such competition is stronger if the firm has more alternative allies than its partner but weaker if the firm and its partner have previously collaborated or share common allies in their networks.

Suggested Citation

  • Victor Cui & Haibin Yang & Ilan Vertinsky, 2018. "Attacking your partners: Strategic alliances and competition between partners in product markets," Strategic Management Journal, Wiley Blackwell, vol. 39(12), pages 3116-3139, December.
    • Handle: RePEc:bla:stratm:v:39:y:2018:i:12:p:3116-3139
    DOI: 10.1002/smj.2746
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    Cited by:

    1. Carolina Rojas-Córdova & Amanda J. Williamson & Julio A. Pertuze & Gustavo Calvo, 2023. "Why one strategy does not fit all: a systematic review on exploration–exploitation in different organizational archetypes," Review of Managerial Science, Springer, vol. 17(7), pages 2251-2295, October.
    2. Yunhui Zhao & Xinyue Wu & Jian Zhang, 2022. "Analysis of the Paths Affecting Corporate Green Innovation in Resource-Based Cities: A Fuzzy-Set QCA Approach," Sustainability, MDPI, vol. 15(1), pages 1-18, December.
    3. Xiaotian Yang, 2022. "Coopetition for innovation in R&D consortia: Moderating roles of size disparity and formal interaction," Asia Pacific Journal of Management, Springer, vol. 39(1), pages 79-102, March.
    4. Lihua Chen & Yilang Chen, 2023. "A Metaorganizations Perspective on Digital Innovation and Corporate Social Responsibility: Evidence from China," Sustainability, MDPI, vol. 15(14), pages 1-19, July.
    5. Vikas A. Aggarwal, 2020. "Resource congestion in alliance networks: How a firm's partners’ partners influence the benefits of collaboration," Strategic Management Journal, Wiley Blackwell, vol. 41(4), pages 627-655, April.
    6. Wonsang Ryu & Thomas H. Brush & Joonhyung Bae, 2023. "How agglomeration affects alliance governance and innovation performance: The role of cluster size," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 44(1), pages 297-310, January.
    7. Lin, Liang-Hung & Ho, Yu-Ling, 2021. "Ambidextrous governance and alliance performance under dynamic environments: An empirical investigation of Taiwanese technology alliances," Technovation, Elsevier, vol. 103(C).
    8. Crick, James M. & Crick, Dave, 2021. "The dark-side of coopetition: Influences on the paradoxical forces of cooperativeness and competitiveness across product-market strategies," Journal of Business Research, Elsevier, vol. 122(C), pages 226-240.
    9. Victor Cui & Rajneesh Narula & Dana Minbaeva & Ilan Vertinsky, 2022. "Towards integrating country- and firm-level perspectives on intellectual property rights," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 53(9), pages 1880-1894, December.
    10. Crick, James M. & Crick, Dave, 2021. "Coopetition and family-owned wine producers," Journal of Business Research, Elsevier, vol. 135(C), pages 319-336.
    11. Ilan Vertinsky & Yingqiu Kuang & Dongsheng Zhou & Victor Cui, 2023. "The political economy and dynamics of bifurcated world governance and the decoupling of value chains: An alternative perspective," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 54(7), pages 1351-1377, September.
    12. Ding Wang & Jiang Wei & Niels Noorderhaven & Yang Liu, 2023. "Signaling Effects of CSR Performance on Cross-border Alliance Formation," Journal of Business Ethics, Springer, vol. 186(4), pages 831-850, September.
    13. Aurora Liu Genin & Justin Tan & Juan Song, 2022. "Relational assets or liabilities? Competition, collaboration, and firm intellectual property breakthrough in the Chinese high-speed train sector," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 53(9), pages 1895-1923, December.
    14. Jiuling Xiao & Yuting Bao & Jiankang Wang, 2023. "Which neighbor is more conducive to innovation? The moderating effect of partners’ innovation," The Journal of Technology Transfer, Springer, vol. 48(1), pages 33-67, February.
    15. Struckell, Elisabeth & Ojha, Divesh & Patel, Pankaj C. & Dhir, Amandeep, 2021. "Ecological determinants of smart home ecosystems: A coopetition framework," Technological Forecasting and Social Change, Elsevier, vol. 173(C).

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