Alliance Management Capability and Firm Performance: Using Resource-based Theory to Look Inside the Process Black Box

This study employs the framework of the resource-based theory (RBT), and investigates the process by which firms can realize the potential value of their alliance management capability. In this process, co-exploration and co-exploitation are regarded as the two main strategic actions needed to leverage alliance management capability. Analyses of multisource, time-lagged data on 172 Finnish manufacturing firms show that alliance management capability has an inverted U-shaped effect on co-exploration, but an increasingly positive effect on co-exploitation. Whereas co-exploration drives firm growth in the longer run, co-exploitation has a positive effect on firms' short-term financial performance. Ambidextrous pursuit of simultaneous co-exploration and co-exploitation, however, is negatively, rather than positively related to firm performance. By shedding light on the black-box process that takes place between alliance management capability and firm performance, these findings add new insights into research on RBT in general and alliance management capability in particular.