ALLIANCE SUCCESS FACTORS AND PERFORMANCE IN SOCIAL ECONOMY ENTERPRISES

PurposeIn this paper the alliance success and failure factors that have been extensively tested in investor-owned companies are assessed in SEEs. To obtain these factors, it first follows the alliance factor classification... [ view full abstract ]

Purpose

In this paper the alliance success and failure factors that have been extensively tested in investor-owned companies are assessed in SEEs. To obtain these factors, it first follows the alliance factor classification presented by Krathu et al. (2015), who reviewed 177 publications and classified success and failure factors into 5 main groups: i) relationship orientation; ii) relational capital; iii) relational norms; iv) atmosphere; and v) others. Then, because this study focuses on SEEs, some specific literature focusing on the management of SEEs has been reviewed (Banaszak, 2008; Mazzarol, Limnios, & Reboud, 2013; Pesämaa, Pieper, Vinhas da Silva, Black, & Hair, 2013). Accordingly, two objectives are set. The first objective is to define and validate a scale of alliance success and failure factors. This scale includes those key factors that will determine the success or failure of an alliance. The second objective is to assess the impact of the success and failure factors on alliance performance.

Methodology

To capture data regarding the alliance success and failure factors among SEEs, a survey was launched in June 2016, and 160 questionnaires were collected. After the data review process, 101 questionnaires were retained for the analysis. The respondents were SEEs that have been involved in alliances in the last 10 years (2006–2016). An array of four different exploratory factor analyses (EFA) through principal component analysis were performed to explore the six different set of items. Once all of the dimensions displayed the correct psychometric properties, two confirmatory factor analyses (CFA) were performed with the remaining items, obtaining the validated “CoopAlliance success” scale. CFA techniques were also used to confirm the impact of the success and failure factors on alliance performance.

Findings

Considering the results obtained, the following three factors determine the alliance outcome: (i) relational capital; (ii) relationship governance; and (iii) the partner selection process. It is agreed that relational capital or social capital formed by aspects such as trust, shared vision, and relationship quality, is an important factor for the success of an alliance. Findings confirm that alliance management is an important factor for the success or failure of alliances. It is agreed that SEEs have a lack of professionalization in management positions, because of having volunteers in some cases, and because they offer lower salaries than investor-owned companies in others. Results also confirmed that several actions as starting the search among known companies, or preparing a short list of companies before selecting the partner(s), increases the probabilities of having a successful alliance.

According to the results, relationship governance and partner selection process factors have a significant impact on alliance performance, although H₂ is confirmed using the robust method and H₃ is confirmed using the standardized method. This means that the partner selection process influences the alliance performance outcome if the significance index is relaxed. The findings show that alliance performance is positively influenced by relationship governance and partner selection process factors, which is in agreement with investor-owned companies’ results.

Relevance

The findings have important implications for practitioners and scholars. SEE managers might use these results to identify alliance key factors and define methods to control them to increase the probabilities of alliance success. Social economy authorities might also use these results to develop programmes to promote and mentor alliances, defining the alliance key factors on which enterprises might focus. Considering scholars, this study takes one step further in the research on alliance success and failure factors between SEEs, which is definitely scarce if compared with the importance of this type of enterprise in today’s economy.  

Main references

Banaszak, I. (2008). Determinants of Successful Cooperation in Agricultural Markets: Evidence from Producer Groups in Poland. In Strategy and Governance of Networks. Physica-Verlag Heidelberg.

Birchall, J., & Ketilson, L. H. (2009). Resilience of the Cooperative Business Model in Times of Crisis. International Labour Organization (ILO).

Krathu, W., Pichler, C., Xiao, G., Werthner, H., Neidhardt, J., Zapletal, M., & Huemer, C. (2015). Inter-organizational success factors: a cause and effect model. Information Systems and e-Business Management 13, 553-593.

Mazzarol, T., Limnios, E. M., & Reboud, S. (2013). Co-operatives as a strategic network of small firms: Case studies from Australian and French co-operatives. Journal of Co-Operative Organization and Management, 1(1), 27–40.

Pesämaa, O., Pieper, T., Vinhas da Silva, R., Black, W. C., & Hair, J. F. (2013). Trust and reciprocity in building inter-personal and inter-organizational commitment in small business co-operatives. Journal of Co-Operative Organization and Management, 1(2), 81–92.

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