Strategic alliances between industrial firms have been increasing in various industries. Especially, high-tech ventures with limited resources and capabilities are more likely to resort to strategic alliance with other industrial firms to develop new products. However, the failure rate of strategic alliance is almost 70%. So it is crucial to identify which factors are associated with the performance of strategic alliance in Korean ventures.
To explore this question, partner search and selection process, and collaboration process of alliance were examined based on the review of existing literature and a case study of 10 strategic alliances in Korean ventures.
The major findings of this study are as follows:
1) Breadth and depth of search efforts for potential partners are related to the prominence of partner; 2) Social network of top management team is related to the opportunity of alliance formation. However, it makes the level of breadth and depth of searching efforts for potential partners low; 3) Prior alliance experiences lead to the accumulation of learning for alliance formation and operation know-how, and thus alliance experiences are positively associated with the prominence of alliance partner; 4) Korean ventures with high level of technological capability are more likely to have the prominent alliance partner; 5) The prominence of alliance partner is related to the performance of strategic alliance; 6) Mutual commitment between partners is also related to the performance of strategic alliance. 7) Acquisition of experts in associated technical areas helps Korean ventures select better partners and facilitate communication with them; and 8) Level of demand uncertainty is negatively related to the alliance performance.
Finally, this study attempts to propose an explorative model, which explains the process of partner search, selection and collaboration with managerial implications.
