Organizational Identity and Interorganizational Alliances
01 Jan 2012-
TL;DR: In this article, the authors examined the relationship between organizational identity and the formation and performance implications of interorganizational alliances and developed a theory of how this variation affects the search for alliance partners in terms of the speed of alliance formation and the diversity between the new organization and its partners.
Abstract: This dissertation examines the relationship between organizational identity and the formation and performance implications of interorganizational alliances. The first study investigates the effect of an organization's identity on its initial alliance portfolio formation, addressing how becoming comprehensible through organizational identity is a fundamental step in order for a new organization to be accepted by the market. Through different categorizations, some new organizations will be more comprehensible and possess clearer identities in the market than others. I develop a theory of how this variation affects the search for alliance partners in terms of the speed of alliance formation and the diversity between the new organization and its partners. The second study investigates how organizational identity affects the impact of alliances on performance outcomes. Alliances that explore and experiment tend to affect organizational outcomes negatively, at least in the short term. Although exploration strategies facilitate learning and adaptation in the long run, they incur costs due to the nature of experimentation. I advance an alternative perspective that organizational identity plays a role in this alliance-performance link. Depending on the strength of an organization's identity in terms of how coherent and taken-for-granted its categorization or social grouping is, the effect on performance may be more or less negative. Overall, this research indicates that organizational identity matters both to an organization's initial alliance portfolio formation and to the impact of this alliance portfolio on performance outcomes. This work contributes to the literature streams of both organizational identity and alliances, and presents the first systematic investigation of the link between them.
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301 citations
Posted Content•
TL;DR: In this paper, the influence of the structure and composition of a firm's alliance network on its exploratory innovation was examined, and the benefits of network closure and access to diverse information can coexist in a firms' alliance network.
Abstract: This study examines the influence of the structure and composition of a firm's alliance network on its exploratory innovation. In a longitudinal investigation of 77 telecommunications equipment manufacturers, I find the technological diversity of a firm's alliance partners increases its exploratory innovation. I also find that network density among a firm's alliance partners strengthens the influence of diversity. These results suggest the benefits of network closure and access to diverse information can coexist in a firm's alliance network and the combination of the two increases exploratory innovation.
54 citations
Posted Content•
TL;DR: A review of the existing literature on alliance portfolio literature can be found in this paper, where three key research areas are identified: (a) the emergence of alliance portfolios, (b) the configuration of alliance portfolio, and (c) the management of portfolio.
Abstract: The engagement of firms in multiple simultaneous strategic alliances with different partners has become a ubiquitous phenomenon in today's business landscape This article offers a review of the extant alliance portfolio literature and organizes it around three key research areas: (a) the emergence of alliance portfolios, (b) the configuration of alliance portfolios, and (c) the management of alliance portfolios The article also highlights existing gaps in the present understanding of alliance portfolios and outlines a research agenda by identifying key research questions and issues in the areas where further research is needed
36 citations
References
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TL;DR: This paper explored how interfirm networks in the U.S. venture capital market affect spatial patterns of exchange and found that information about potential investment opportunities generally circulates within geographic and industry spaces.
Abstract: Sociological investigations of economic exchange reveal how institutions and social structures shape transaction patterns among economic actors. This article explores how interfirm networks in the U.S. venture capital (VC) market affect spatial patterns of exchange. Evidence suggests that information about potential investment opportunities generally circulates within geographic and industry spaces. In turn, the circumscribed flow of information within these spaces contributes to the geographic‐ and industry‐localization of VC investments. Empirical analyses demonstrate that the social networks in the VC community—built up through the industry’s extensive use of syndicated investing—diffuse information across boundaries and therefore expand the spatial radius of exchange. Venture capitalists that build axial positions in the industry’s coinvestment network invest more frequently in spatially distant companies. Thus, variation in actors’ positioning within the structure of the market appears to differentia...
1,344 citations
TL;DR: The authors argue that absorptive capacity and organizational inertia impose conflicting pressure on alliance formation decisions and argue that companies balance exploration and exploitation in their alliance formation decision making, and why and how.
Abstract: Do firms balance exploration and exploitation in their alliance formation decisions and, if so, why and how? We argue that absorptive capacity and organizational inertia impose conflicting pressure...
1,307 citations
"Organizational Identity and Interor..." refers background or methods in this paper
...Previous research has defined exploration and exploitation alliances in terms of their function and structure (Beckman, Haunschild, and Phillips, 2004; Lavie et al., 2011; Lavie and Rosenkopf, 2006; Rothaermel, 2001)....
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...First, alliances—both exploration- and exploitation-oriented—are ubiquitous in the industry, as industry competition and the intangible nature of business software requires that firms develop a functionally diverse portfolio of partners (Messerschmitt and Szyperski, 2003); the software industry has been the focus of many alliance studies (e.g., Lavie, 2007; Lavie and Rosenkopf, 2006) for this very reason....
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...Following established research practices, I categorized technology, research and development, and new product development alliances as exploration alliances and marketing and distribution alliances as exploitation alliances (Lavie and Rosenkopf, 2006; Rothaermel, 2001)....
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...! ! ! 44 balance exploration and exploitation (Beckman, 2006; Fang, Lee, and Schilling, 2010; Lavie and Rosenkopf, 2006)....
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...! ! ! 42 I use the function and structure of an alliance to identify it as an exploration or exploitation alliance (Lavie, Kang, and Rosenkopf, 2011; Lavie and Rosenkopf, 2006)....
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Book•
28 Dec 1999
TL;DR: The Demography of Corporations and Industries as discussed by the authors is the first book to present the demographic approach to organizational studies in its entirety, and it examines the theory, models, methods, and data used in corporate demographic research.
Abstract: Most analysts of corporations and industries adopt the focal perspective of a single prototypical organization. Many analysts also study corporations primarily in terms of their internal organizational structures or as complex systems of financial contracts. Glenn Carroll and Michael Hannan bring fresh insight to our understanding of corporations and the industries they comprise by looking beyond prototypical structures to focus on the range and diversity of organizations in their social and economic setting. The result is a rich rendering of analysis that portrays whole populations and communities of corporations."The Demography of Corporations and Industries" is the first book to present the demographic approach to organizational studies in its entirety. It examines the theory, models, methods, and data used in corporate demographic research. Carroll and Hannan explore the processes by which corporate populations change over time, including organizational founding, growth, decline, structural transformation, and mortality. They review and synthesize the major theoretical mechanisms of corporate demography, ranging from aging and size dependence to population segregation and density dependence. The book also explores some selected implications of corporate demography for public policy, including employment and regulation.In this path-breaking book, Carroll and Hannan demonstrate why demographic research on corporations is important; describe how to conduct demographic research; specify fruitful areas of future research; and suggest how the demographic perspective can enrich the public discussion of issues surrounding the corporation in our constantly evolving industrial society. All researchers and analysts with an interest in this topic will find The Demography of Corporations and Industries an invaluable resource.
1,271 citations
TL;DR: In this article, a co-evolutionary theory of strategic alliances is proposed, in which strategic alliances are embedded in a firm's strategic portfolio, and coevolve with the firm's strategy, the institutional, organizational and competitive environment, and with management intent for the alliance.
Abstract: This paper proposes a co-evolutionary theory of strategic alliances. The paper proposes a framework which views strategic alliances in the context of the adaptation choices of a firm. Strategic alliances, in this view, are embedded in a firm's strategic portfolio, and co-evolve with the firm's strategy, the institutional, organizational and competitive environment, and with management intent for the alliance. Specifically, we argue that alliance intent may be described, at any time, as having either exploitation or exploration objectives. We further discuss how the morphology of an alliance-absorptive capacity, control, and identification-may be isomorphic with its intent, and, in the aggregate, drive the evolution of the population of alliances.
1,259 citations
"Organizational Identity and Interor..." refers background in this paper
...Exploration alliances, however, indicate a more significant degree of change, as they relate to new technology development and are primarily motivated by an organization’s desire to discover new opportunities (Koza and Lewin, 1998)....
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...To this stream, the organizational learning literature has made significant contributions, maintaining that alliances fall into two categories, exploration alliances and exploitation alliances, according to their mode of organizational adaptation (Koza and Lewin, 1998)....
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TL;DR: In this paper, the authors consider a production market with two sides: producers are a fully connected clique transacting with buyers as a separate but aggregated clique, each producer is a distinctive firm with a distinctive product, and each side continually monitors reactions of the other through a joint social construction, the schedule of terms of trade.
Abstract: Production markets have two sides: producers are a fully connected clique transacting with buyers as a separate but aggregated clique. Each producer is a distinctive firm with a distinctive product. Each side continually monitors reactions of the other through the medium of a joint social construction, the schedule of terms of trade. Each producer is guided in choice of volume by the tangible outcomes of other producers—not by speculation on hypothetical reactions of buyers to its actions. Each producer acts purely on self-interest based on observed actions of all others, summarized through a feedback process. The summary is the terms-of-trade schedule, which reduces to constant price only in limiting cases. The market emerges as a structure of roles with a differentiated niche for each firm. Explicit formulae—both for firms and for market aggregates—are obtained by comparative-statics methods for one family of assumptions about cost structures and about buyers' evaluations of differentiated products. Not just any set of firms can sustain terms of trade with any set of buyers. There prove to be three main kinds of markets, and three sorts of market failure, within a parameter space that is specified in detail. One sort of market (PARADOX) has a Madison Avenue flavor, another is more conventional (GRIND), and a third (CROWDED) is a new form not included in any existing theory of markets. Current American industrial markets are drawn on for 20 illustrations, of which three are presented in some detail. Inequality in firms' market shares (measured by Gini coefficients) is discussed.
1,190 citations