Growth through simultaneous alliances : learning and synergistic effects

الملخص EN

Aim of the Paper : while the long-term benefits of either equity or non-equity alliances are well defined by prior research, the synergistic benefits from simultaneously engaging in both modes of alliances remain unclear.

By conceptualizing the firm’s alliance-alliance synergies into balanced and combined dimensions, this paper investigates the synergies that firms obtain through simultaneous alliances.

The paper also examines the individual temporal effect of equity and non-equity alliances on the short-term and long-term performance of the firm.

Study Design : the study relies on annual empirical archival data of strategic alliance activities, financial performance, characteristics of the top management team and board of directors for U.S.

firms over 20 years.

Sample and Data : a panel data on 202 U.S Fortune 500 firms that engaged in alliances from year 1995 through 2015 is used to test the hypotheses.

Results : firms achieve a balanced effect when they maintain a relative balance in the number of the equity and non-equity alliances.

In contrast, firms achieve a combined effect when they increase the combined magnitude of their alliances in both modes during a specific year.

The findings strongly support the hypothesis that firms achieve learning and synergistic benefits from simultaneously engaging in less balanced alliance activities, while the benefits are larger for alliance portfolios with more combined effects.

The study also shows that non-equity alliances generate immediate value within one year of the alliance’s formation, while equity alliances create deferred benefits that are mostly allocated after the first year of the alliance.

Conclusion : firms can achieve greater synergistic benefits through simultaneously combining and managing the balance of different alliance modes.

Therefore, firms can support their competitive position through the effective management of their strategy alliance portfolio.