Coping with Diversity in Alliances for Innovation: The Role of Relational Social Capital and Knowledge Codifiability
| Author | Carmen Cabello‐Medina,Vesna Vlaisavljevic,Ana Pérez‐Luño |
| Published date | 01 April 2016 |
| Date | 01 April 2016 |
| DOI | http://doi.org/10.1111/1467-8551.12155 |
British Journal of Management, Vol. 27, 304–322 (2016)
DOI: 10.1111/1467-8551.12155
Coping with Diversity in Alliances
for Innovation: The Role of Relational
Social Capital and Knowledge Codifiability
Vesna Vlaisavljevic, Carmen Cabello-Medina and Ana P´
erez-Lu˜
no
Universidad Pablo de Olavide, Crtra. Utrera, Km. 1, 41013 Seville, Spain
Corresponding author email: vvla@acu.upo.es
Alliances are increasingly considered a key element for innovation, especially in
knowledge-intensive firms. While this is true, the mere membership to alliances does not
explain innovation performance, and thus the alliance’s characteristics that determine
high performance must be examined. This research address the question of how the di-
versity of partners in a certain alliance for innovation aects innovation performance,
and how this influence can be moderated by certain characteristics, such as the relational
dimension of social capital and the type of knowledge shared among partners. The empir-
ical analysis of a sample of 90 biotech companies shows that there is an invertedU-shaped
relationship between alliance partner diversity and innovationperformance and confirms
the positive moderating eects of relational social capital and knowledge codifiability.
These findings contribute to the current research on alliances for innovationby providing
empirical evidence on why some alliances perform better than others. Also, the results
suggest that the study of alliance partner diversity, as a determinant of alliance perfor-
mance, should not be addressed in isolation.
Introduction
Alliances are increasingly considereda key element
for innovation, given that they enable organiza-
tions to exchange valuable knowledge resources
and share costs and risks (Dooley, 2007; Gulati,
1998; Hagedoorn, 1993). They can be defined as
any cooperative agreement voluntary initiated be-
tween firms that can involve ‘exchange, sharing
or co-development, and it can include contribu-
tions by partners of capital, technology, or firm-
specific assets’ (Gulati and Singh, 1998, p. 781).
This phenomenon becomes particularly important
in knowledge-intensive industries, usually consist-
ing of a set of many dierent technologies for
which unique and dierentiated capabilities are re-
quired. This is the case for the biotech industry on
which this research is focused. Given the breadth
and pace of technological change in this indus-
try, exploring all facets of the R&D without spe-
cialized external support is not possible even for
large pharmaceutical companies (Pisano, 2006). In
turn, biotech companies that support these R&D
activities of big pharma firms have to look outside
themselves to find the competences to commercial-
ize their innovations, given that they are not likely
to be successful in carrying out the entire set of
business functions along the value chain (Oliver
and Liebeskind, 1997; Powell, 1998). Therefore,
the biotech industry is characterized by the exis-
tence of multiple inter-organizational agreements
among dierent types of partners trying ‘to
build knowledge at an inter-organizational level’
(Nonaka, 1994), in order to achieve their innova-
tion aims.
Thus, alliances do matter for innovation perfor-
mance in the biotech industry.For the purposes of
this paper, we consider alliances as formal agree-
ments established between two or more organiza-
tions, with specific objectives related to the R&D
and innovation (Powell, Koput and Smith-Doerr,
1996). However, the performance achieved by
© 2015 British Academy of Management. Published by John Wiley & Sons Ltd, 9600 Garsington Road, Oxford OX4
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Diversity in Alliances for Innovation 305
alliances for innovation does not always meet the
companies’ expectations, so trying to explain how
certain characteristics of these alliances contribute
to their success remains a relevant research ques-
tion (Sampson, 2007; Schilke and Goerzen, 2010;
Wassmer, 2010).
This research focuses on alliance partner diver-
sity,referred to a certain alliance of the firm. It rep-
resents an alliance attribute that may have a par-
ticularly relevant eect on performance (Goerzen
and Beamish, 2005; Nieto and Santamaria, 2007).
Although this construct has been addressed mainly
in the literature about alliance portfolio (Duysters
et al., 2012; de Leeuw, Lokshin and Duysters,
2014; Faems, Van Looy and Debackere. 2010;
Goerzen and Beamish, 2005), their discussion
about the benefits and drawbacks of having very
diverse partners is also useful for supporting our
theoretical discussion about the impact of partner
diversity on performance in a certain alliance.
Diverse partners can provide access to non-
redundant knowledge and, therefore, give more
opportunities for valuable learning (Teece, 1998;
Wuyts and Dutta, 2014). Indeed, a single type
of partner could hardly provide all the special-
ized knowledge and resources that are necessary
in industries characterized by a high pace of tech-
nological and scientific change. Thus, in these
industries, firms increasingly try to configure a
set of diverse partners in their alliances, includ-
ing customers, suppliers and research institutions
(de Leeuw, Lokshin and Duysters, 2014). Owen-
Smith and Powell (2004) highlighted the innova-
tion benefits for science-based firms, coming from
their alliances with diverse types of organizations
(universities, small firms, publicresearch institutes
and large pharmaceutical companies). Hence, al-
liance partner diversity has become a key feature
of alliances in the biotech industry (Hendry and
Brown, 2006).
In spite of the undeniable advantagesof alliance
partner diversity, research has not been conclusive
about their eects.Indeed, the potential benefits of
diversity could be undermined by some problems
associated with sharing and transferring very di-
verse knowledge. In this sense, some studies report
a negative relationship between alliance diversity
and performance, reflecting the drawbacks of hav-
ing diverse partners (Faems et al., 2010; Goerzen
and Beamish, 2005).
Given that arguments for and against al-
liance diversity may be equally compelling, more
recent studies are addressing curvilinear relation-
ships in order to reconcile these contrary argu-
ments (Duysters and Lokshin, 2011; de Leeuw,
Lokshin and Duysters, 2014; Jiang, Tao and
Santoro, 2010; Wuyts and Dutta, 2014). That is,
having diverse partners contributes to improving
the performance but, beyond a certain level of di-
versity, its benefits could be dicult to reap, given
the hindrances to share and transfer knowledge
among firms that have little in common (Kogut
and Zander, 1992; Lane and Lubatkin, 1998).
Although this curvilinear approach can help to
overcome the lack of consistency in the research,
not all the firms are likely to benefit equally from
having diverse partners (Wuyts and Dutta, 2014).
Thus, some contextual factors mayaect this rela-
tionship. Indeed, the previous research is increas-
ingly claiming that the impact of dierent dimen-
sions of alliance configuration on performance
cannot be assessed precisely without understand-
ing the contingent eect involved (Schilling and
Phelps, 2007; Wassmer, 2010; Zheng and Yang,
2015). In this sense, Sampson (2007) states that
the eect of organizational form on performance
depends on technological diversity between part-
ners. Terjesen, Patel and Covin (2011) examined
how the interaction between manufacturing capa-
bilities in the alliance and alliance partner diversity
aects venture performance.At the level of alliance
portfolio, Duysters et al. (2012) demonstratedthat
alliance experience and alliance capabilities mod-
erate the diversity–performance relationship. Oer-
lemans, Knoben and Pretorius (2013) found that
technology management tools moderate the ef-
fect of alliance partner diversity and firm’s inno-
vation outcomes.Wuyts and Dutta (2014) demon-
strated that internal knowledge creation strategies
improve the impact of portfolio diversity on prod-
uct innovation.
The literature referred to above suggests that
the relationship between alliance partner diver-
sity and innovative outcomes may be influenced
through conscious and targeted managerial eorts
(Oerlemans, Knoben and Pretorius, 2013); that is
to say, contextual factors addressed in previous
research include capabilities, tools, alliance forms
and knowledge strategies. Nevertheless, not only
may these conscious eorts and actions moderate
the eect of diversity, but also certain attributes
of the alliance itself could influence how diver-
sity has an impact on innovation performance.
In this sense, given that knowledge is not likely
© 2015 British Academy of Management.
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