Do firms with more alliance experience outperform others with less? A three‐level sigmoid model and the moderating effects of diversification

Abstract

Whether firms with more alliance experience perform better than those with less and whether the alliance strategy interacts with diversification strategy to shape firm performance are two critical but underexplored questions. To address these queries, this study develops a three-level sigmoid framework built upon a marginal analysis that contrasts alliance benefits and alliance costs, and considers the moderation of diversification that often closely works with the alliance in shaping firm performance. Empirical results obtained from firms in two alliance-populated industries support first that the alliance experience-performance relationship is S-shaped in that the linkage is negative to alliance novices, positive to alliance experts, and negative again to alliance overusers; and second, that the shape of this sigmoid curve varies systematically between high-and low-diversified firms. Copyright © 2015 ASAC. Published by John Wiley & Sons, Ltd.Keywords: strategic alliance, alliance experience, firm performance, sigmoid model, alliance-performance relationship Résumé Les entreprises qui ont plus d'expériences en matière d'alliance réussissent-elles mieux que celles qui en ont moins? La stratégie d'alliance interagit-elle avec la stratégie de diversification pour définir la performance de l'entreprise? Voilà deux questions importantes qui n'ont pas toujours bénéficié de l'attention des chercheurs. Pour y apporter des éléments de réponse, la présente étude propose un cadre sigmoïde à trois niveaux construit sur une analyse marginale qui d'une part, contraste les bienfaits de l'alliance avec ses coûts, et, d'autre part, examine la modération de la diversification qui s'associe souvent étroitement à l'alliance pour façonner la performance. Les résultats empiriques obtenus des firmes de deux industries dotées d'alliances indiquent que la relation expériences en matière d'alliance/performance est en forme S dans la mesure où le lien est négatif pour les débu-tants en alliance, positif pour les experts en alliance et négatif pour les firmes qui en font un usage excessif. Les résultats montrent aussi que la forme de cette courbe sigmoïde varie systématiquement selon que les firmes sont hautement ou faiblement diversifiées.

When Does Competitive Learning Occur? The Impact of Alliance Network Embeddedness on Technological Invasion

“…Relative alliance experience. Following previous studies, we counted the total number of alliances that each firm had ever participated in, beginning in 1986 (Lee, Hoetker and Qualls, 2015;Tseng and Chen, 2017). Relative alliance experience was calculated as the focal firm's alliance experience minus its partner's alliance experience.…”

A refined consumer behavior model for energy systems: Application to the pricing and energy-efficiency problems

“…As shown in [29], supported by a large number of empirical evidence from a wide variety of industrial sectors, including plastics, automobile, energy, transportation, and chemicals, the relationship between investment in research and development and firm performance can be better described by sigmoidal functions. And also, the sigmoidal shape has been shown to be efficient in depicting ecological benefit functions [30] and the alliance experience-performance relationship [31]. Regarding the electrical consumer utility, empirical results (actual experience) obtained from consumers indicates that the marginal benefit at a very low consumption should be very small since a low consumption could not support the appliances to finish basic tasks (such as heating and lighting).…”

“…Then plugging ( 23) into ( 27), the constant p can be derived. At last, another rate q can be determined by (31) and (32). Considering the difference between the two price levels, we provide different interpretations for the following three scenarios: q ą p, q ă p, and q " p. When q ą p, the optimal pricing policy is to encourage the users to consume large amount of power (discount for large consumption), corresponding to the practical case where the power utility have strong generation capacity which has not been well exploited.…”

“…For the piecewise pricing schemes proposed above, it can be easily checked that x OP i P t0, r i `p p α q 1 α´1 u. While the price before the threshold is selected as (31), it can be checked that x OP i " r i `p p α q 1 α´1 if i ď J ‹ and x OP i " 0 for i ą J ‹ . According to (11) and (12), it can be verified that ) is close to the performance of SEE, which is the maximum performance can be attained without constraints and only the first consumer will be active in SEE policy.…”

Executive antecedents of interfirm cooperation

“…Following this conceptualization, previous research has extensively investigated antecedents of interfirm cooperation including trust (Gulati, 1995;Korsgaard, Schweiger, & Sapienza, 1995;Madhok, 1995Madhok, , 2006McAllister, 1995;Milgate, 2000;Pesämaa & Franklin Hair, 2007), psychological factors (such as value congruence, legitimacy perceptions of allies, and justice perceptions), and structural factors (such as number of allies, similarity of partners, historical ties, predictability of outcomes and context; Chiung-Hui Tseng & Shih-Fen, 2017;Murnighan, 1994;Smith et al, 1995;Tiessen & Linton, 2000). An important limitation in interfirm relationships research is the lack of attention to the role of organizational actors in interfirm relationship processes.…”