Alliance Governance Mechanisms in the Face of Disruption

Abstract

Existing academic literature has discussed contracts and relational governance as the key mechanisms that help alliance partners address problems of cooperation and coordination. However, when an alliance undergoes disruption, the nature and extent of such problems may change and therefore the value of these mechanisms may change. This study advances a dynamic perspective on alliance governance by examining the impact of disruption and subsequent adjustment on the value of alliance governance mechanisms. To this end, we longitudinally studied a revelatory case of a research and development alliance in the veterinary drug industry that experienced disruption triggered by an internal restructuring at one of the partner companies. We approached the evidence with a fine-grained typology that builds on two dimensions that underlie governance mechanisms: the means to enforce their ruling principles (contractual versus relational) and the level of codification of these principles (formal versus informal). Based on our findings, we (1) show the significance of this revised typology, which suggests that contractual governance is not necessarily formal and relational governance is not necessarily informal; (2) provide a more systematic discussion of the tradeoffs that the various mechanisms entail and how these are altered through disruption and adjustment dynamics; and (3) analyze how the interplay between different types of governance mechanisms evolves following disruption and adjustment. Overall, our study brings the concept of disruption to the dynamic perspective of alliance governance and highlights the contingent value of alliance governance mechanisms.

Governance of Interorganizational Projects: A Process-Based Approach Applied to a Latin American–European Case

“…The literature on the governance of IORs has mainly evolved in the field of strategic alliances (Albers, 2005(Albers, , 2010Albers et al, 2016;Keller et al, 2021) and interorganizational networks (Provan & Kenis, 2008;Wegner & Verschoore, 2022). Although distinct interorganizational phenomena (e.g., alliances, networks, partnerships, projects) have different characteristics concerning the number of participants and their goals, we borrow concepts of governance discussed in the literature on strategic alliances and networks to analyze whether and how they apply to interorganizational projects.…”

Management of alliance post-formation dynamics: an integrated model

“…Reuer and Ariño, 2002;Ariño et al, 2008;Greve et al, 2010;Steensma et al, 2008;Kavusan and Frankort, 2019). Keller et al (2021) summarized such contingencies as disruption, which can be defined as a non-routine event that impairs the regular operation of inter-organizational relationships and makes it difficult for partners to continue their partnership in a current way.…”

Co-branding research: where we are and where we could go from here

“…Indeed, scholars assume that contractual governance mechanisms naturally provide a solution to the problems derived from the uncertainty of co-brand alliances (Magid, 2006;Ferguson et al, 2005). In other words, it is possible to formulate contractual mechanisms able to specify partners' responsibilities and rights (Keller et al, 2021). However, as our respondents confirmed, contractual governance mechanisms are costly and cannot prevent negative circumstances (such as, for example, instances in which one of the partners is involved in a negative event after the co-brand alliance is established).…”