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Does Speed Really Matter When It Comes To Alliance Performance?

Author

Listed:
  • Michael Hoeck

    () (TU Bergakademie Freiberg)

  • Christian M. Ringle

    (TU Hamburg-Harburg)

Abstract

This paper explores the long-term partnership benefits of local strategic alliances in the software industry. A structural model of the value continuum is formulated and tested on data from small and midsize enterprises in Germany. Partial Least Squares Analysis is used to investigate the effect-casual-relations between foundation values, i.e. efficiency and effectiveness, and the innovation value. The results of our empirical study show that the innovation value of localized inter-firm networks originates from costs savings and quality improvements. On the contrary, alliance-induced ´speed´, measured by an acceleration of the R&D process, improved flexibility and/or shortened delivery time, has no significant impact on the market-based performance. Time-related benefits of alliances stated in literature may be important to maintain competitive parity, but they do support competitive advantage, market development and market penetration. Instead, value is created, among others, via exchange of tacit knowledge and reduction of transaction costs, particularly by a reduction of customer service costs.

Suggested Citation

  • Michael Hoeck & Christian M. Ringle, 2010. "Does Speed Really Matter When It Comes To Alliance Performance?," Polish Journal of Management Studies, Czestochowa Technical University, Department of Management, vol. 2(1), pages 81-105, December.
  • Handle: RePEc:pcz:journl:v:2:y:2010:i:2:p:81-105
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    More about this item

    Keywords

    Local Strategic Networks; Small and Midsize Enterprises; Value Continuum; Software Industry; Partial Least Squares-Analysis;

    JEL classification:

    • D00 - Microeconomics - - General - - - General
    • L00 - Industrial Organization - - General - - - General
    • P00 - Economic Systems - - General - - - General

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