Alliance Activity Research Articles

The effects of knowledge network characteristics on R&D alliance formation

ABSTRACT Firms’ knowledge characteristics shape their research and development (R&D alliance activities). When denoting the characteristics, the alliance literature has exclusively focused on firms’ internal knowledge characteristics, leaving structural properties of their knowledge relatively unexplored. Therefore, this study aims to investigate how firms’ knowledge network characteristics are associated with the propensity to ally. By using 235,024 unique alliance dyads between U.S. semiconductor firms and their potential partners, we examine the effects of two knowledge network characteristics – degree centrality and structural holes – on alliance formation. We further examine the joint effects of the knowledge network characteristics. Our findings reveal the curvilinear relationship between degree centrality and the likelihood of alliance formation. We also find support for the positive joint effects on the likelihood of alliance formation. These findings provide implications for the varying propensity to ally associated with the knowledge network characteristics, i.e. structural positions of a firm’s knowledge elements in the sector-level knowledge network.

More resources are better? Strategic alliance involvement and cost stickiness

Utilizing a sample of Chinese listed firms from 2007 to 2020, we document that cost asymmetry behavior is amplified when firms engage in alliance activities. The main effect is more pronounced for firms facing higher adjustment costs, pronounced agency problems, and those led by particularly optimistic managers. Additional analyses suggest that the presence in alliances augments cost stickiness, especially when alliance members come from diverse industries, are significantly larger in scale, or are situated in different geographical regions. The results offer fresh insights into how strategic alliances influence firms’ resource adjustment decisions.

How to leverage the impact of firm-specific uncertainty on innovation performance? Moderating effects of alliance stage and partner type in the pharmaceutical industry

This study investigates the impact of firm-specific uncertainty on innovation performance and how alliances moderate this relationship in the pharmaceutical industry. To reflect drug research and development (R&D) characteristics, we separate the alliance stage into “preclinical research” and “drug development,” and examine the effects of alliances with different partner types (public and private). An integrated firm-level dataset was created for empirical analysis by combining financial, alliance, patent, and new product data from 96 US pharmaceutical firms. We found that while a firm's uncertainty does not always significantly impact alliance activities, it positively influences certain innovation performance (new products). Furthermore, we probe the moderating effect of alliances on the relationship between uncertainty and innovation performance. The results revealed that alliances with public organizations strengthened the relationship in the “preclinical stage”; however, there was no significant effect in the “drug development” stage. Also, alliances with private firms even negatively moderates in “drug development stage” in some innovation performance. This study provides novel evidence that alliances can mitigate or exacerbate innovation performance depending on the alliance stage and partner type.

THE GLOBALIZATION OF NATO ACTIVITIES: UNIMPLEMENTED AND PROMISING SCENARIOS

During the decade 2014–2023 NATO has again focused on the containment of powerful non-Western powers (Russia and also China). It means that the Alliance has returned to the logic of functioning and development of the past Cold War. At the same time NATO has intensified its desire for globalization of activities, but in a different geographical configuration and forms then they were at the beginning of XXIst century. The article tries to explore the process of the globalization of the Alliance activities, uses the theory of armed forces’ building and the theory of alliances. The author issues the dynamics and the results of unsuccessful NATO’s attempts to become the security provider for unstable states in the Middle and Near East (since 2000-s). The choice of new directions of NATO activities outside the Alliance’s area of responsibility was reasoned by the need to increase the effectiveness of the “deterrence” of Russia, “containment” of China, emphasizing the Alliance’s viability in the situation when the new world order has started to form. The new directions of the NATO’s usage at the global level are becoming the Arctic (basing on the cooperation with Norway as the Alliance’s member state) and Indo-Pacific region (the key track is the deepening cooperation with Japan and Australia). The scientific paper explores political and military steps of NATO and concludes about the perspectives of NATO activities in both regions.

NORAD Modernization: Private Benefits to Canada

ABSTRACT The workhorse of military alliances theory is the joint products model where the prominent existence of private benefits from alliance activities alleviates the free-riding problem. In the case of NORAD Modernization project, there are potentially large private economic benefits accruing to Canada. These benefits may include technology transfers and domestically produced inputs from some sectors exhibiting comparative advantage. In this latter case, the benefits will largely depend on whether a JSF type consortium will undertake the investments efficiently as opposed to the so-called benefits obtainable from Canada’s fundamentally inefficient offsets program, Industrial and Technological Benefits (ITB). The article focuses on Canada’s Key Industrial Capabilities (KIC), the 17 sectors officially selected as supporting the country’s operational capabilities. The width of this selection as well as the procurement and industrial policy interaction are briefly discussed.

State‐Owned Enterprises and Cross‐Border Alliances

AbstractThis study examines the international alliance activities of state‐owned enterprises (SOEs). We find that country‐level political and economic factors, such as autocracy, foreign ownership restrictions, foreign currency reserve, and industry dissimilarity, increase the likelihood of SOEs’ participation in cross‐border alliances. Our analyses further reveal that foreign firms tend to collaborate with local SOEs when facing high expropriation risks and the presence of a state‐dominated banking system in the host country. Further, foreign firms experience higher announcement returns when they ally with local SOEs rather than with non‐SOEs. This result suggests that the exclusive benefits from SOEs are value‐creating for the international alliance partners. Overall, our findings provide novel insights into the determinants and wealth effect of SOEs’ engagement in international alliance activities.

Outside directors' equity incentives and strategic alliance decisions

This study examines whether the proportion of equity-based compensation in outside director compensation is associated with corporate strategic alliances. We hypothesize that equity incentives provided to outside directors mitigate potential agency conflicts between outside directors and shareholders that arise from the strategic alliance decision-making process, thus resulting in more alliance activities. Our empirical evidence indicates that the percentage of equity in outside director compensation is positively associated with the incidence and the number of strategic alliance activities. Additionally, when the proportion of outside directors' equity in total compensation is higher, firms with strategic alliances generate better future stock returns. Overall, our findings suggest that providing equity incentives in outside director compensation mitigates the agency problems inherent in corporate strategic alliance decisions and enhances the quality of alliance activities.

Beneficial, Harmful, or Both? Effects of Corporate Venture Capital and Alliance Activity on Product Recalls

Despite growing numbers of corporate venture capital (CVC) deals and alliances, their effectiveness is not guaranteed. This paper investigates the positive and negative impacts of CVC and alliance activity on product safety under different levels of market turbulence. Using a resource-based learning perspective and panel data from large U.S. firms, we find that both CVC and alliance activity have inverted U-shaped relationships with product recall likelihood. Market turbulence moderates both relationships, but differently. We discuss how learning theory complements the resource-based view to understand why no or rather bold external venturing are less harmful than small-scale “stuck-in-the-middle” initiatives.

Development of supportive characteristics to facilitate learning from strategic alliances

Abstract In this paper, we aim to find answer to a single question: what are the characteristics of firms with superior use of alliance learning practices? Consequently, we aim to discover the characteristics of firms which are more preoccupied to learn from their strategic alliances. We investigate this research question through a statistical analysis of the answers provided by 46 best performing medium and large-sized companies operating in Romania. By means of several multilinear regressions and an analysis of variance, we found that the companies with superior use of alliance learning practices – thus, more preoccupied to learn – are more proactive, build an alliance culture favouring the use of alliances, develop relational attributes in their alliances (e.g., trust), respectively monitor and control their alliance activity to a higher degree. Contrary to expectations, the companies with superior use of alliance learning practices do not collaborate to a higher degree horizontally, with their competitors and complementors. In terms of the dispersion of companies depending on their use of alliance learning practices, to a high degree (34.1%), the differences between companies can be explained by the proposed set of characteristics developed in this paper. Our findings contribute to the existent literature in the field of alliances, bringing empirical evidence on the characteristics that companies need to develop to better learn from their strategic alliances. In addition, executives of medium and large-sized companies find in this paper valuable information regarding the nurturing of alliance knowledge acquisition and transfer from their strategic allies and partners.

Basic and applied research collaboration trends in the pharmaceutical industry

Abstract Firms in science-driven industries have traditionally devoted significant resources to basic scientific research. The intensity and outcomes of such investments, however, have changed over time. In this paper, we explore the trends in pharmaceutical companies’ scientific research over a two-decade period between 1990 and 2009. The results of our analyses reveal that the scientific output of large pharmaceutical companies as measured by the publications of company scientists has significantly increased over time. We also find that company scientists’ collaboration with external scientists has increased over time and across the board regardless of company size. Finally, we observe a decline in research and development alliance activities of pharmaceutical companies with the effect being weaker for large firms.

ДІЯЛЬНІСТЬ МІЖНАРОДНОГО АЛЬЯНСУ З ПИТАНЬ СВОБОДИ РЕЛІГІЙ ТА ВІРОСПОВІДАНЬ У 2021 РОЦІ

Compilation and thematic monitoring of information messages, thematic summarization, rubrication of messages of the International Alliance on Freedom of Religion and Belief for 2021 allowed to reflect the received information on priority areas in this review article. The paper systematizes and summarizes the internal content of both the Alliance's working papers and reports from open sources, such as the official websites of the participating countries' Ministries of Foreign Affairs, the official website of the United States Department of State, and more. In the article it is discussed and arranged the issues raised by the Alliance in 2021, aimed at protecting religious freedom in the world, and at the level of "global" initiatives, other information messages are considered in detail. Based on the working documents of the Alliance, the main vectors of the Alliance's activities and the main goals of its existence have been identified. Within the work of the Alliance, the activities of such participating countries as the Commonwealth of Australia, the Kingdom of Denmark, the Republic of Cameroon, the Republic of Colombia, the Republic of Estonia, the United States of America is considered. According to the Alliance, the situation of religious freedom in countries such as the Federal Republic of Nigeri, the Islamic Republic of Pakistan, the People's Democratic Republic of Algeria, the People's Republic of China, the Republic of Cameroon, the Republic of Colombia, the Republic of the Union of Myanmar, the State of Qatar is revealed. Сonclusions of International Charitable Human Rights Christian Organization "Open Doors" and the Centre for Social Justice – independent centreright think tank – are considered. The content and conclusions of this scientific article have become one of the sections of the qualification work "2021 Initiatives aimed at protecting religious freedom in the world."

Seeking a Friend and Ally

It is widely known in other micro fields such as organizational behavior and psychology that motivation is an important predictor of behavior. Yet the alliance and Upper Echelons literature have largely overlooked this important antecedent. A deeper understanding of a CEO’s motivations can illuminate why a firm may engage in higher levels of alliance activity while another firm may not. In this study, we explore how CEO needs—a manifestation of internal motivation—may impact alliance behavior. The results of our study demonstrate that the motivations of CEOs – namely their need for affiliation– have a non-linear relationship with alliance activity. More specifically, the results suggest an initial positive relationship between the need for affiliation and alliance activity. However, at high levels of affiliation, the CEO’s concern for harmony with their board becomes more important, resulting in lower alliance activity.

Firing Costs and Decoupling of Technological Invention and Post-invention Investments

We show that employment protection laws, which increase firing costs, decouple invention and post-invention investment by reducing the coordination benefits of collocation. The decoupling played a significant role in US employment decline and jobless growth, the vertical and geographical disintegration of firm activities, and underinvestment relative to Tobin’s Q. Technological inventions lead to employment growth, but employment protection laws almost fully negate this positive effect, especially in fast-changing and high-offshore industries and for radical inventions. We find limited effects on firm revenue and profits, as firms bypass increased firing costs through capital substitution and increased JV and alliance activities, driven in part by collaborations with foreign partners. Our findings suggest labor market flexibility as a critical link between invention and firm growth dynamics and question the efficacy of technology-led revival of the US manufacturing employment without the accompanying labor market reforms.

Supporting Cadets to Develop Their English Reading Skills during the Covid-19 Pandemic at the “Nicolae Balcescu” Land Forces Academy of Sibiu

The paper analyses the manner in which the developing of reading skills of the second year military students of the “Nicolae Balcescu” Land Forces Academy was done during the second semester of the academic year 2019-2020, when the COVID-19 Pandemic was declared and the cadets had to leave the Academy. We consider that English Language course taught during the second semester, a course meant to help students hone their reading skills and to acquire basic military vocabulary was a success. The Academy provided the laptops, the high quality platform and online support necessary for the online courses. There were also certain qualities of the cadets that played an important role in the very good results they obtained at the end of the online English Language course: their age, their discipline, the good command of technical skills and particularly their motivation; all of them being aware that “since the end of the Cold War, foreign language training—especially the learning of English, the de facto operational language―has become increasingly important within armed forces. This is especially the case at NATO due to an ever-increasing number of peace-support operations, on the one hand, and the Alliance's enlargement and partnership activities, on the other. Language skills—in both Allied and Partner countries—are primarily a national responsibility. However, language training must be of concern to NATO as a whole since linguistic interoperability is as important to ensuring that countries are able to participate effectively in both NATO missions and wider Alliance activities as any other form of interoperability”. [1]

Partner-based opportunism, interface structure, and performance efficiency in upstream and downstream alliance activities contexts

Few alliance studies have theorized that opportunisms effect on performance efficiency is contingent on other factors. Our study posits that alliance partner size and no end-point serve as interface structure mechanisms that condition the efficiency outcomes of partner-based opportunism in alliances. We argue that the direct effect of partner-based opportunism, and the moderation effects of alliance partner size and no end-point, differ according to the alliance activities context (i.e., upstream vs. downstream). Our hypotheses were tested using a survey of 361 alliances. We observe that partner-based opportunism is indeed associated with performance inefficiencies. Further, while alliance partner size has a nonsignificant moderating effect, no end-point has a positive moderating effect, on the relationship between partner-based opportunism and efficiency; that is, the negative link becomes less negative for no end-point alliances. We find that the negative performance relevance of partner-based opportunism remains significant among upstream alliances, but drops to nonsignificance for downstream ones. We show that alliance partner size has a negative moderating effect on the link partner-based opportunism to performance efficiency among downstream, but not upstream, alliances. Lastly, we find that the positive moderating effect of no end-point is significant among upstream, but not downstream, alliances. Our results generate important implications for managers' efforts to design and govern alliances.

NATO and the Arctic

With NATO activity increasing and great power competition building between the US, Russia and China across the Arctic, the Alliance needs to consider a new strategic approach to the region. Duncan Depledge examines how NATO’s traditionally cautious approach to the Arctic is now outmoded given the recent pressures posed by Russian military activity, Chinese ambition and the renewal of US strategic interest in the region. In response, NATO must go beyond simply restating its interest in the Arctic and devise a new strategic approach that normalises Alliance engagement, keeps a weather eye on Chinese ambitions, and leaves scope for expanding Alliance activity still further as the region is transformed by environmental and geopolitical change. ◼

A Latent Space Modeling Approach to Interfirm Relationship Analysis

Interfirm relationships are crucial to our understanding of firms’ collective and interactive behavior. Many information systems-related phenomena, including the diffusion of innovations, standard alliances, technology collaboration, and outsourcing, involve a multitude of relationships between firms. This study proposes a latent space approach to model temporal change in a dual-view interfirm network. We assume that interfirm relationships depend on an underlying latent space; firms that are close to each other in the latent space are more likely to develop a relationship. We construct the latent space by embedding two dynamic networks of firms in an integrated manner, resulting in a more comprehensive view of an interfirm relationship. We validate our approach by introducing three business measures derived from the latent space model to study alliance formation and stock comovement. We illustrate how the trajectories of firms provide insights into alliance activities. We also show that our proposed measures have strong predictive power on stock comovement. We believe the proposed approach enriches the methodology toolbox of IS researchers in studying interfirm relationships.

Brand Alliances and Stock Reactions

Purpose: This paper examines the performance and risk of brand alliances by investigating the market value of brand alliances through the analysis of investors’ response, and look into the differen...

Organization Structure Matters: R&D Centralization and Alliance Governance

We bridge current streams of corporate strategy and cooperative strategy research to investigate the potential implications of organizational structure for alliance governance in technology partnerships. We propose that in an alliance between a client firm and an R&D firm, the client firm’s internal structure of R&D plays an important role in the alliance design and governance, specifically in determining the scope, interdependence, and contracting of alliance activities and the distribution of control rights. Using data from alliances in the bio-pharmaceutical industry, we find that firms with centralized R&D structure tend to engage in alliances with broader scope and higher task interdependence, and they are more likely to capture the upstream control rights through the design of R&D contracts. We therefore extend research over several decades that has examined the organization and structuring of alliances themselves to highlight the importance of parent firm organizational structure for the ways that firms set up alliances.

The role of strategic alliances in VC exits: evidence from the biotechnology industry

ABSTRACT In this study, we analyze the impact of strategic alliances on VC exits. We explicitly ask whether strategic alliances may serve as a certifying device for new potential investors and whether the role alliances play differs in IPO and M&As. We hypothesize that strategic alliances serve as a certifying device particularly in instances with many uninformed buyers (IPOs) but not when there is a single buyer (M&As). To empirically test this hypothesis, we draw on a sample of 663 US VC-backed biotechnology companies founded between 2004 and 2008. We explicitly control for observed and unobserved heterogeneity in our cohort sample, alleviate concerns relating to self-selection into alliance activity, and assuage methodological concerns with respect to censoring. Our findings suggest that alliances improve the probability of successful exits for IPOs, but not for M&As. Moreover, we find a smaller effect than prior studies do.