Choice of alliance structures when allying with competitors: Matching structures to alliance resources and risks

Abstract

Alliance structure is the way of cooperation in strategic alliances. As to strategic alliances established by competitors (competitive alliances), in which the partner firms have dual role as competitor and cooperator, proper governance structure becomes more essential to balance the forces between competition and cooperation, making the alliance to create values. Mainly based on resource-based view, this article studied the issue of alliance structure choice in competitive strategic alliance. We focused on the impacts of alliance resources and partner's perceived relational risks on governance structure decisions. From the aspects of direct and indirect effects, the complicated relation among alliance structure choice and other involved factors has been discussed by empirical analysis methods including structure equation modeling, moderating effect analysis, mediating effect analysis, etc. Finally, the selection mechanism of the alliance structure in competitive alliance is revealed. The conclusion shows that when competitive alliance is separated into scale alliance and link (complementary) alliance, there will be great difference between alliance structure choice and partner's resource investment and perceived relational risks. It demonstrated that, compared with link alliance, partners in scale alliance tend to choose loose structure to protect strategic resources and reduce hold-up risk, while prefer tight structure to hedge loss of capacity risk.