by Lucas Elumah
This study explores the interplay between strategy alliance and network processes in explaining firm performance in highly unpredictable environments like what is obtained in Nigeria. Firms can outperform rivals by pursuing two types of... more
This study explores the interplay between strategy alliance and network processes in explaining firm
performance in highly unpredictable environments like what is obtained in Nigeria. Firms can outperform rivals
by pursuing two types of strategic alliance: advantage-creating and advantage-enhancing. Each of these strategic
alliances creates different needs, motivations, and opportunities for joint activity. This research work shows that
firms with better advantage-creating strategies become entrenched in extra network process and are more likely
to form non-equity strategic alliances in the future period, whereas firms with strong advantage-enhancing
tendencies become rooted in intense network process with many equity-based strategic alliances in the future
period. However, if different strategies lead to formation of different types of network processes, are these
tendencies advantageous for firm performance? If not, what is the optimal combination of strategic alliance and
network processes that maximizes firm performance? This paper argue that network process provides
advantageous access to external resources that can both balance the internal capabilities of the firm and
substitute for the capabilities that a firm is lacking.This paper finds out that network process plays both
balancing and substitutive roles, however, my findings suggest dense network process is more favorable for
firms that have superior either advantage-creating or advantage-enhancing capabilities, whereas firms with
inferior internal capabilities can benefit more from a sparse network process. A correlation analysis was carried
out on a sample of 125 respondents which indicates a positive relationship among both variables
performance in highly unpredictable environments like what is obtained in Nigeria. Firms can outperform rivals
by pursuing two types of strategic alliance: advantage-creating and advantage-enhancing. Each of these strategic
alliances creates different needs, motivations, and opportunities for joint activity. This research work shows that
firms with better advantage-creating strategies become entrenched in extra network process and are more likely
to form non-equity strategic alliances in the future period, whereas firms with strong advantage-enhancing
tendencies become rooted in intense network process with many equity-based strategic alliances in the future
period. However, if different strategies lead to formation of different types of network processes, are these
tendencies advantageous for firm performance? If not, what is the optimal combination of strategic alliance and
network processes that maximizes firm performance? This paper argue that network process provides
advantageous access to external resources that can both balance the internal capabilities of the firm and
substitute for the capabilities that a firm is lacking.This paper finds out that network process plays both
balancing and substitutive roles, however, my findings suggest dense network process is more favorable for
firms that have superior either advantage-creating or advantage-enhancing capabilities, whereas firms with
inferior internal capabilities can benefit more from a sparse network process. A correlation analysis was carried
out on a sample of 125 respondents which indicates a positive relationship among both variables