Interpretive schemes in cross‐national alliances : Managing conflicts and discrepancies

Purpose – The purpose of this paper is to propose a framework for understanding how alliance partners interpret alliance functioning and how these interpretations shape their subsequent behaviors. Also, to discuss how interpretive schemes in cross‐national strategic alliances impact upon the management of the problems arising from the cultural conflicts and discrepancies inherent in such alliances. Design/methodology/approach – Proceeding from the notion that interpretive schemes have important implications for the evolution of cross‐national alliances, the paper describes the two fundamental interpretive schemes that relate to sensemaking – that of sensemaking of and in chaos, and examines how an appreciation of these interpretive schemes enable us to better manage cultural conflicts and discrepancies that inevitably arise in cross‐national alliances. Findings – The framework makes clear that the two types of interpretive schemes − “sensemaking of chaos” and “sensemaking in chaos” − need to be appreciated as interpretive frames that are present among the alliance managers to effectively interact and influence partner firms. Practical implications – Briefly, the two types of the interpretive schemes call for different strategies for developing them. Alliance partners embedded in different national cultures rely on interpretive schemes to make sense of the conflicts and discrepancies that emerge in cross‐national alliances. Originality/value – The paper responds to the need of managers with alliance responsibilities for a framework to help develop the most effective ways of managing interpretive schemes in alliances for productive interactions and performance.