Session 45

New Perspectives on Alliance Termination

Track N

Date: Monday, October 8, 2012

 

Time: 13:30 – 14:45

Paper

Room: Dressing Room 220


Session Chair:

  • Beverly Tyler, North Carolina State University

Title: It Takes Two to Continue to Tango: A Two-Sided View on Post-M&A Supplier-Buyer Tie Continuation

Authors

  • Youtha Cuypers, Nova School of Business and Economics
  • Xavier Martin, Tilburg University

Abstract: We examine the effect of buyer-side M&As on the continuation of buyer-supplier ties from both the buyer’s and the supplier’s perspective. We focus on post-M&A changes in competitive overlap between the merged company and the other buyers in the focal supplier’s customer base. We test our hypotheses on a sample of 798 advertising agency-client ties, for which the client was involved in an acquisition. Our results suggest that buyers are concerned about sharing a supplier with competitors, but these fears are mitigated when they are in a better bargaining position. Our findings suggest that suppliers also exhibit concerns about competitive overlap, but they are less likely to terminate a focal relationship to avoid conflicts with other buyers when the focal buyer is an important buyer.

Title: Joint Venture Instability and Termination Outcomes: The Role of the Interpartner Distribution of JV-related Gains

Authors

  • Birgul Arslan, Koc University
  • Ulrich Wassmer, EMLYON Business School
  • Pierre Dussauge, HEC-Paris

Abstract: This study examines the impact of interpartner distribution of JV-specific gains on JV termination decisions. Using insights from social exchange theory, we suggest that equity considerations play a significant role in the satisfaction derived from a JV, and in turn, in decisions to terminate the JV. We also suggest that while both efficiency and equity considerations determine termination decisions, they have different implications for the type of termination (termination by acquisition vs. dissolution). We develop hypotheses that we test by using data on 286 joint ventures among U.S. public firms formed over the period 1996 to 2010.

Title: Organizational Stigma and Alliance Termination

Authors

  • Olga Bruyaka, West Virginia University
  • Deborah Philippe, HEC-Lausanne

Abstract: Break-ups and member withdrawals are very common in strategic alliances, and may run as high as 50 percent in some industries. Existing research has mainly explained alliance instability through the prism of internal tensions. In this paper, we provide a complementary explanation of alliance termination as the result of unexpected external contingencies (i.e., adverse events). Drawing on the organizational stigma, organizational status, social network, and resource dependence literatures, we develop theoretical predictions about the conditions under which adverse events that are experienced at the firm level will be likely to represent disruptive factors at the alliance level and subsequently lead to premature alliance termination.

Title: The Impact of Alliance Termination on Organizational Reputation

Authors

  • Ehsan Fakharizadi, University of Houston-Victoria
  • Azi Gera, Drexel University

Abstract: Strategic alliances discourse has put significant attention on the formation, duration and stability of alliances. However, there is no research on the consequences of alliance termination. We study the impact of alliance termination on organizational reputation. Building on social economics and organizational theory, we argue that a firm’s visibility, capabilities and its partners’ prominence influence the impact of alliance dissolution on reputation. We test our hypotheses by identifying terminations of VC syndications in the VentureXpert database. Results indicate that visibility and resource availability significantly impact post alliance termination reputation loss. Moreover, terminated partners suffer more reputation loss when compared to terminating partners. However, former partners’ characteristics do not impact the focal firm’s post alliance termination reputation.

All Sessions in Track N...

Sun: 08:00 – 09:15
Session 100: Interdisciplinary Perspectives on Cooperative Strategies
Sun: 09:30 – 10:45
Session 101: Practicing Cooperative Strategies
Sun: 11:15 – 12:30
Session 102: Research Methods in Cooperative Strategies
Sun: 15:15 – 16:30
Session 46: Value Creation and Capture in Alliances
Mon: 08:00 – 09:15
Session 44: Network Contingencies and Alliance Performance
Mon: 09:30 – 10:45
Session 50: Trust and Relational Governance
Mon: 13:30 – 14:45
Session 45: New Perspectives on Alliance Termination
Mon: 16:30 – 17:45
Session 51: Resource- and Knowledge-Based Views of Cooperative Strategies
Tue: 08:00 – 09:15
Session 248: Cooperation and Industry Contingencies
Tue: 11:00 – 12:15
Session 247: Cooperative Strategies
Tue: 14:15 – 15:30
Session 48: Managing Alliance Dynamics
Tue: 15:45 – 17:00
Session 49: Organizational Learning and Alliances
Tue: 17:30 – 18:45
Session 47: Governing and Managing High-Tech Collaborations


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