Chapter 5: Governance Structure Choice in Strategic Alliances: The Roles of Alliance Objectives, Alliance Management Experience, and International Partners

Strategic alliances serve the strategic objectives of partner firms (Doz & Hamel, 1998). Due to factors such as globalization and emerging technologies, it is increasingly difficult to obtain sustainable competitive advantage in rapidly changing markets (D’Aveni, 1994). Any one firm by itself often does not possess all the necessary resources and capabilities to compete effectively. Strategic alliances offer an alternative to such firms, whereby they could join forces with other firms in the pursuit of opportunities that would otherwise be beyond the firm’s current capabilities. In essence, alliances allow partner firms to creatively combine resources in the establishment of joint competitive advantage.