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X Jiang et al. /Journal of International Management 14(2008)173-189 alliance will not prematurely dissolve or be terminated. Therefore, this conceptualization of alliance stability, in terms of the absence of major changes in ownership structure, differs from previous instability definitions, whose focus has been solely on static alliance outcomes (iii) The foundation of alliance stability is the maintenance and development of active and harmonious relationships among partners. If there are risks in inter-partner relationships which are perceived beyond a certain level and become the dominant threat to an alliance, the stability of the alliance will be undermined Further, the foregoing definition implies that stable alliances must have a balance of both structure rig strategic flexibilities (Das and Teng, 2000). On one hand, a stable alliance should have enough rigidity or adaptive capabilities to resist unexpected environmental contingencies and internal risks. Rigidity is a key to the avoidance of premature dissolution. On the other hand, a stable alliance should also have a certain degree of strategic flexibility order to continuously adapt to environmental changes, to adjust to the unexpected consequences of predictable changes and to respond to the changing partners needs(Young-Ybarra and w 1999: Emst and Bamford, 2005) 4. An integrated process model of alliance development Alliances evolve during their lifetime. The process and evolution of alliances underscore the importance of the developmental stages. Although researchers agree that alliances evolve in stages, there is no consensus on the specific stages that alliances go through. Following Das and Teng(1999), we consider four stages in this paper: partner selection, structuring/negotiation, implementation and performance evaluation. Fig. I illustrates the theoretical framework of the paper and the conceptual orientation. The positive arrows indicate that alliances generally evolve along the four developmental stages, whereas the dashed left-pointing arrows suggest some of the reversals that might occur at any moment in the life span of the alliance. Specifically, each alliance is a repetitive sequence of the four stages, and some stages may repeatedly occur as the lliance evolves(Ring and Van de Ven, 1994; Doz, 1996; Arino and de la Torre, 1998). For example, after an alliance has formed, the criteria for partner selection will be reconsidered when a new partner enters into the current alliance The initial alliance conditions(e.g, joint scope or division of labor) may have to be renegotiated in the event of unforeseen changes in the environment and in the relationship status. In some alliances, performance evaluation will recur regularly over time Despite increasing interest in the alliance developmental process, research has failed to consider the stability issue in the process. Researchers have usually investigated the many factors underlying alliance stability just a few at a time And few of these researchers have examined the possible impact of individual factors on stability across the four stages In addressing this gap, we propose a process model in which the main antecedents of alliance stability are examined. In the following we identify, review and integrate a number of factors underlying alliance stability in each stage. From this discussion, we generate specific propositions Certainly, our purpose is not to develop an exhaustive list of factors in this framework. Instead, we focus on the critical factors endogenous to the alliance relationship. Those factors exogenous to alliances (e. g, envir Partner Structuring/ Implementation Performance Selection Negotiation Evaluation Resource Governance Alliance Risks Evaluation Endowments Structure Management Reputation Alliance Scope Evaluation Division of Contro Prior tie Mechanisms Fig. 1. Process model of alliance development: critical factors and managerial actions.alliance will not prematurely dissolve or be terminated. Therefore, this conceptualization of alliance stability, in terms of the absence of major changes in ownership structure, differs from previous instability definitions, whose focus has been solely on static alliance outcomes. (iii) The foundation of alliance stability is the maintenance and development of active and harmonious relationships among partners. If there are risks in inter-partner relationships which are perceived beyond a certain level and become the dominant threat to an alliance, the stability of the alliance will be undermined. Further, the foregoing definition implies that stable alliances must have a balance of both structure rigidity and strategic flexibilities (Das and Teng, 2000). On one hand, a stable alliance should have enough rigidity or adaptive capabilities to resist unexpected environmental contingencies and internal risks. Rigidity is a key to the avoidance of premature dissolution. On the other hand, a stable alliance should also have a certain degree of strategic flexibility in order to continuously adapt to environmental changes, to adjust to the unexpected consequences of predictable changes and to respond to the changing partners' needs (Young-Ybarra and Wiersema, 1999; Ernst and Bamford, 2005). 4. An integrated process model of alliance development Alliances evolve during their lifetime. The process and evolution of alliances underscore the importance of the developmental stages. Although researchers agree that alliances evolve in stages, there is no consensus on the specific stages that alliances go through. Following Das and Teng (1999), we consider four stages in this paper: partner selection, structuring/negotiation, implementation and performance evaluation. Fig. 1 illustrates the theoretical framework of the paper and the conceptual orientation. The positive arrows indicate that alliances generally evolve along the four developmental stages, whereas the dashed left-pointing arrows suggest some of the reversals that might occur at any moment in the life span of the alliance. Specifically, each alliance is a repetitive sequence of the four stages, and some stages may repeatedly occur as the alliance evolves (Ring and Van de Ven, 1994; Doz, 1996; Ariño and de la Torre, 1998). For example, after an alliance has formed, the criteria for partner selection will be reconsidered when a new partner enters into the current alliance. The initial alliance conditions (e.g., joint scope or division of labor) may have to be renegotiated in the event of unforeseen changes in the environment and in the relationship status. In some alliances, performance evaluation will recur regularly over time. Despite increasing interest in the alliance developmental process, research has failed to consider the stability issue in the process. Researchers have usually investigated the many factors underlying alliance stability just a few at a time. And few of these researchers have examined the possible impact of individual factors on stability across the four stages. In addressing this gap, we propose a process model in which the main antecedents of alliance stability are examined. In the following we identify, review and integrate a number of factors underlying alliance stability in each stage. From this discussion, we generate specific propositions. Certainly, our purpose is not to develop an exhaustive list of factors in this framework. Instead, we focus on the critical factors endogenous to the alliance relationship. Those factors exogenous to alliances (e.g., environmental Fig. 1. Process model of alliance development: critical factors and managerial actions. X. Jiang et al. / Journal of International Management 14 (2008) 173–189 179
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