Alliances as collaborative regimes : An institutional based explanation of interfirm collaboration

Purpose – The management and strategy literature continues to show that many companies now rely on alliances for their long‐term success. This paper seeks to explain why some industries have an over‐representation of inter‐firm strategic alliances, relative to others. Design/methodology/approach – A theory of group behavior is used to show that an inter‐organizational phenomenon, notably the interaction of convergent expectations, including shared patterns of behavior, beliefs and mindsets, are partially responsible for the disproportionate use of alliances in some industries relative to others. The theory of group behavior presented draws mainly on conceptual ideas from regime and new institutional theory. Findings – The framework suggests that the presence of industry‐embedded factors, including shared mindsets, creates the conditions that transform the strategic interests and behavior of individual firms into a macro phenomenon that diffuses across an industry. Industry developed shared mindsets in turn provide the conditions for trust to endure, cooperation instead of opportunism to prevail, and lower transaction costs, all critical elements for alliance formation. Practical implications – The research presented here shows that industry‐level factors may be an important factor for determining the incidence and perhaps the performance of value‐creating alliances. Originality/value – This paper extends our understanding of strategic alliances as a source of a firm's competitiveness and fulfills a need for a greater understanding of the over‐representation of strategic alliances in some industries, relative to others.