Do birds of a feather flock higher? the effects of partner similarity on innovation in strategic alliances in knowledge-intensive industries

Xiaowei Luo*, Lina Deng

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

69 Scopus citations

Abstract

In spite of the consensus on the benefits of strategic alliances for learning and innovation, our understanding of the effects of partner similarity remains conflicted. This paper develops an integrative theoretical framework in which we propose that similar partners in a focal firm's alliance portfolio contribute to the firm's innovation up to a threshold, beyond which additional similar partners can lead to a decrease in innovation because of the trade-offs embedded in collaboration between similar partners. In this integrative framework, we also draw on organizational ecology and institutional perspectives to propose that the effect of partner similarity on innovation is positively moderated by organizational aging and the industry norm of collaboration at the firm's founding. Results from an analysis of 176 biotechnology firms between 1988 and 1999 support our arguments. This study contributes to research on strategic alliance and innovation by considering both the benefits and costs of partner similarity in the context of alliance portfolios and by exploring the multilevel contingencies for the effects of partner similarity.

Original languageEnglish (US)
Pages (from-to)1005-1030
Number of pages26
JournalJournal of Management Studies
Volume46
Issue number6
DOIs
StatePublished - Sep 1 2009

ASJC Scopus subject areas

  • Business and International Management
  • Strategy and Management
  • Management of Technology and Innovation

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