Internationalization of exploitation alliance portfolios and firm performance

Purpose: The purpose of this paper is to analyze the impact of alliance portfolio internationalization (API) on firm performance in the context of exploitation alliances. Design/methodology/approach: The hypothesis is tested by applying a panel regression using a sample of 64 airlines over a nine years period. Findings: As a result, the study finds a U-shaped relationship between API and firm performance. Research limitations/implications: The results are particularly relevant for firms using many exploitation (e.g. marketing) alliances. Practical implications: In the context of exploitation alliances, managers should focus either on local partners or to take advantage of partners with a high degree of foreignness. Stuck in the middle seems to be not advantageous. Originality/value: Previous work found an S-shaped relationship between portfolio internationalization and firm performance while concentrating on exploration alliances. In contrast, this study shows that exploitation alliance portfolios do not experience a decline of firm performance at high levels of portfolio internationalization.