Governance by targets and the performance of cross‐sector partnerships: Do partner diversity and partnership capabilities matter?

Abstract

Research Summary: This study examines the effectiveness of targets as a tool for the contractual governance of cross‐sector partnerships. Applying a difference‐in‐differences methodology, we find that the use of explicit targets within performance contracts is an effective means for improving partnership outcomes, especially where partner diversity and partnership capabilities are high. Furthermore, we find evidence that target intensity is associated with stronger partnership performance. These findings suggest that contractual forms with explicit targets may be a particularly successful approach for enhancing the public value created by cross‐sector partnerships. A downward turn in performance following the removal of targets lends further support to this conclusion. Managerial Summary: Cross‐sector partnerships have become a vital means for creating value in pursuit of the public interest. In particular, the effective management of these partnerships is thought to hold the key to addressing the strategic and organizational challenges posed by major social and environmental issues, such as big data and climate change. In this article, we combine data on waste recycling from 2003 to 2014 with information on performance contracts between local cross‐sector partnerships and higher levels of government in England to quantify the impact of governance by targets on the performance of those partnerships. The benefits of target‐setting for partnership performance that we identify are even stronger when partner diversity is high and partnership capabilities are strong. We discuss the managerial and policy implications of our findings.

Unpacking the impact of social media analytics on customer satisfaction: do external stakeholder characteristics matter?

“…Second, we show that low diversity of business partner collaboration might create more SMA's value potential. This finding is in contrast to the recent literature that has strongly emphasised that high level of partner diversity is preferred for the creation of business value (Alonso and Andrews, 2019;Potter and Paulraj, 2020). We caution that practitioners should not entirely follow the recent mantra; rather, when optimising SMA, they are advised to adopt a selective distribution strategy in which a limited number of business partners are chosen for partnership.…”

Examining alliance management capabilities in cross-sector collaborative partnerships

“…Therefore, a tremendous amount of research has been dedicated to investigating and understanding the conditions, processes, and enabling factors that can explain and mitigate, or at least manage, these complexities in order to enhance the potential of the collaboration to deliver the sought-after value for society (e.g., Alonso & Andrews, 2018;Bryson et al, 2006;Koschmann et al, 2012;Seitanidi & Crane, 2009). Indeed, a successful collaboration needs partners who accept adaptive responsibilities and codesign mechanisms (Le Ber & Branzei, 2010), which are necessary for goal alignment (Austin, 2000), as well as resilience against relational tensions (Berger et al, 2004).…”

“…Despite the richness of this literature, we still lack adequate understanding of the capabilities that organizations demand when stretching their relationships beyond the boundaries of their sector (Alonso & Andrews, 2018;Gölgeci et al, 2019;Pittz & Intindola, 2015). These relational capabilities, also referred to as alliance management capabilities (AMC), are the skills necessary for organizations to establish and manage their external collaborations (Schreiner et al, 2009).…”

“…Driven by these advantages, we argue that examination of AMC in cross-sector collaboration settings could provide substantial insights which can advance theory and practice (Alonso & Andrews, 2018;Austin & Seitanidi, 2012b;Liu & Ko, 2011;Murphy et al, 2012). Since such capabilities have not been sufficiently examined in such partnerships' context, the purpose of this paper is to investigate AMC in nonprofit-business collaborations (NBCs), a form of cross-sector collaboration (Selsky & Parker, 2005), with a focus on the nonprofit actor perspective.…”

“…Recently, scholars have paid some attention to the relevance of these capabilities within the cross-sector collaboration setting (e.g., Alonso & Andrews, 2018;Dentoni et al, 2016;Liu et al, 2018). However, central to these attempts is the assumption that AMC are universally applicable; perceived as a contextfree construct.…”