Key Establishment Decisions in Public-Private Alliances – Constrained Verses Voluntary Models as a Major Determinant of Success

Key Establishment Decisions in Public-Private Alliances – Constrained Verses Voluntary Models as a Major Determinant of Success Les Baxter Tasmanian Alkaloids Pty. Ltd., Tasmania, Australia Email: baxtersx@bigpond.net.au;... [ view full abstract ]

Key Establishment Decisions in Public-Private Alliances – Constrained Verses Voluntary Models as a Major Determinant of Success
Les Baxter
Tasmanian Alkaloids Pty. Ltd., Tasmania, Australia
Email: baxtersx@bigpond.net.au; phone: +61403056676

Public-private alliances are becoming an important modality for the delivery of official development assistance programs, yet high failure rates of 30 to 70% have been reported in the literature. A qualitative study of eleven public-private alliances (PPAs) in overseas development assistance programs found that these alliances conformed , in general, to either the constrained choice or voluntary types described by Stephens et al. (2009), Ring and Van de Ven (1994) and others. Constrained Choice Alliances (CCAs) are those in which the three key alliance decisions: whether to partner; with whom; and how the alliance will be structured and managed (governance) are constrained, generally because of the power dependency of the partners on an external party. This type of alliance is quite common and can arise where the power reliance is on an organisation such as an ODA funding body. In contrast, with Voluntary Alliances (VAs), the partners are not constrained with respect to the key alliance decisions. CCAs are characterised by low trust, power dependency, and opportunistic behaviour. This may lead to tension in the alliance, relatively low levels of cooperation and alliance dysfunction. The research reported in this paper found that CCAs and VAs as described by Stephens and others are actually Weberian Ideal Types. None of the eleven PPAs studied conformed entirely to either model. All had at least some characteristics of both CCAs and VAs but they had a tendency towards one extreme or the other. This paper draws on qualitative data from the study of the eleven PPAs to analyse and describe the differences between these alliances and the relationship between the degree of constraint in the key alliance decisions and the resulting behaviours and dysfunctions of the ensuing alliances. These study results have important practical implications. The author proposes that the initiators of PPAs have the capacity to influence the degrees of constraint by the partners with respect to the three key alliance decisions; thus affecting the potential behaviour of the partners in the alliance, the degree of cooperation and the level of alliance dysfunction. This has the potential to influence the effectiveness and longevity of the alliance.

References:
Ring, P. S. and Van de Ven, A. H. (1994). Developmental processes of cooperative inter-organizational relationships. Academy of Management Review, 19(1), 90-118.

Stephens, K. J., Fulk, J., and Monge, P. R. (2009). Constrained choices in alliance formations: Cupids and organisational marriages. Human Relations, 62(4), 501-536.