Abstract
Although research has implicitly assumed small- or medium-sized enterprises (SMEs) employ alliances to improve performance, few studies have directly investigated how and when current performance levels might prompt firms to cooperate. Based on disparate predictions of the behavioral theory of the firm (BTOF) and threat rigidity thesis, we developed competing hypotheses regarding the impact of performance dissatisfaction on future alliance intentions for firms with and without previous alliance experience. Employing a dataset of 657 SMEs from six countries, results indicate that for firms with alliance experience, increasing managerial dissatisfaction with current performance decreased intentions to employ future alliances, thus supporting the BTOF thesis. Overall, these results highlight the importance that current performance satisfaction plays in influencing future alliance formation intentions.
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