Chapter 4: Complexifying the Perceived Chaos: A Hybrid Interpretive Scheme for Engaging With Dark Potentialities in Strategic Alliances

Strategic alliances have mushroomed in the contemporary landscape. Yet a plethora of them fail to satisfy the partners’ strategic objectives. To sustain successful alliances, firms and the individuals involved need to cope with the inherent interpartner risks and uncertainties, which exist on multiple levels and make interactions among the partners challenging. From an interpretive perspective, prior research has identified that interpretive schemes are critical for alliance managers to make sense and cope with unexpected events that raise concerns about the partner’s future behavior. In particular, two alternative interpretive schemes have been suggested, namely sensemaking of chaos and sensemaking in chaos (Das & Kumar, 2010). Whereas the former drives alliance managers to calculate and mitigate exchange hazards, the latter encourages them to suspend and embrace dark potentialities inherent in strategic alliances. This chapter aims to advance the understanding of the synergistic implication of the two interpretive schemes and to increase clarity regarding when and how these can be integrated. Drawing upon bodies of literature on risk and uncertainty, I argue that while risk is the cornerstone of sensemaking of chaos, uncertainty is the cornerstone of sensemaking in chaos. Building upon this, I suggest that when potentiality is examined from both the prisms of risk and uncertainty, alliance managers engage in the integrative interpretive scheme complexifying the perceived chaos, which assumes that engaging with dark potentialities is a multi-solution task. This encourages successful engagement not only with predictable and eliminable facets of potentiality, but also with unpredictable and ineliminable ones. Thereby alliance managers can cope with dark potentialities as both calculation and suspension of exchange hazards are enabled.