The Impact of Personal and Organizational Ties on Strategic Alliance Characteristics and Performance: A Study of Alliances in the USA, Israel and Taiwan

Companies creating value through global strategies increasingly use alliances in the ‘race for the world’ (Doz and Hamel 1998). In order to achieve global success, managers benefit from creating effective alliances. Research into the determinants of strategic alliance characteristics and performance has examined various factors, including motives and organizational characteristics of the partners (Contractor and Lorange 1988; Sakakibara 1997), technology (for example, Williamson 1991), industry characteristics (for instance, Harrigan 1986), and partnering organizations’ countries of origin (for example, Gomes-Casseres 1989). While these explanations offer many insights into designing more effective alliances, this research has generally not considered the role of interpersonal relationships in creating international partnerships (Olk and Earley 1996). Overlooking this dimension is important because alliances are considered to be a ‘relational contract’ (Williamson 1985) — a mixture of formal, legal provisions and interpersonal exchanges (Ring and Van de Ven 1994) — and an exchange-based explanation underlies most theoretical accounts of alliances. Given that there are culturally different approaches toward the concept of an exchange (Fiske 1991), how well a company manages these various exchanges will undoubtedly affect the success of its strategic alliances and its global strategy.