Alliances Between Academic Entrepreneurs & Large Firms-A Theory Elaboration Approach to Effectuation

Abstract

This study applies a theory elaboration approach to investigate how effectuation's assumption manifests in inter-firm alliance governance. We conducted a field study of 25 alliances between technology-based academic entrepreneurs and large firms. We generate theoretical insights into how effectuation contributes to two dominant alliance governance mechanisms: trust and control. The emerging findings contribute to both scholarship of effectuation and inter-firm relationship governance by revealing how means-based actin and goal ambiguity respectively facilitate and impede trust-building an alliance and how affordable loss contributes to alliance control.