Factors Influencing Organizational Structure In The Food Manufacturing, Chemical, Agricultural Wholesaling And Biotechnology Industries
The objective of this study is to identify factors determining a business investment strategy (i.e., the choice of investment commitment and form of organizational structure) in the food manufacturing, chemical, agricultural wholesaling and biotechnology industries. Propositions regarding strategic alliance theories are tested on over 400 inter-firm collaborative agreements using secondary data from major US and European companies for the 1994-97 period. Results suggest that transactions with lower technological and resource uncertainty levels are more likely to result in investments with a higher commitment level (i.e., acquisitions or majority equity-based controlling investments). The investment commitment level embedded in a single business transaction seems to be affected not only by a goal of cost minimization, but also by strategic motives and firm and industry factors.
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