Publications

Journal Article

This paper explores the effects of partner substitutability and alliance network structure on organizational profitability. Using data from alliances among firms in the US telecommunications industry, the authors show that, while firms are expected to benefit from the exclusive resources brought in by resource-rich, non-substitutable alliance partners, those benefits could be offset by the costs of allying with such partners.

A densely connected alliance network, however, can help firms to mitigate the costs of allying with non-substitutable partners and to realize the benefits expected from such alliances. Rather than benefiting from being brokers between disconnected non-substitutable partners, a firm facing such partners was better off when its alliances were embedded in third-party ties, which allowed the firm to gain indirect leverage on the powerful partners.