A Framework for Managing Knowledge in Strategic Alliances in the Biotechnology Sector

Biotechnology is a rapidly expanding field of science that has led to the formation of a large number of companies that together form a significant sector within the Australian economy. Even though there has been considerable growth in the Australian biotechnology sector as a whole, a large percentage of Australian biotechnology firms are small and medium sized enterprises (SMEs) that suffer from a lack of funding and expertise. The development and management of effective strategic alliances are critical to the success and development of biotechnology firms as they provide opportunities to share resources and expertise, access funding and develop new ideas. However, developing and managing strategic alliances is fraught with difficulties which are compounded by size and resource asymmetries and the nature of the biotechnology market. In this paper, we identify the difficulties faced by biotechnology firms and examine the importance of knowledge management related to alliance formation and development with special reference to the Australian context. We examine the knowledge and expertise that are required to be effective in developing strategic alliances in the biotechnology sector and provide a framework for managing knowledge related to strategic alliances. We suggest that critical systems approaches, in particular creative holism, are needed to manage the various forms of knowledge associated with strategic alliances.