An Empirical Research On Asymmetric Performance Of Link And Scale Alliances

Global market and international business environment has been changed a lot since 1980s. The environment become more and more complex and fugitive, it seems that an amount of multinational enterprises can not feed international maket demand if they have resources and competences of alone. A firm needs to give better service or make better goods with cooperation with other counterparts. So, since 1980s, international strategic alliances has become being a good choice of organizational modes and institutional arrangements for many multinational firms.Former studies used to measure alliance performance with sales income, maket share, or other accounting indicators. This research makes outcomes of alliances as indicator of alliance performance. Four types of alliances are focused, which are reorganize, takeover, continue, and dissolve. Strategic alliances can be classified into link alliances and scale alliances. Scale alliances are the ones which gather the similar resources of alliance partners and participate in the business all partners are familiar with. So it can bring scale economy and more efficiency in scale alliances.In the other way, link alliances organize and relocate complementary resources to search new chances in new business area. This can bring new stand for each of the alliances partners to strart a new business area. Firms can take advantage of being in alliances to enhance own internal competence to get a chance for a new business independently. Even if there is no enouth inter-partners learning, each partner can make a banance among all learning opportunies to expand its own business. So, in theory, there should be asymmetric performance between scale alliances and link alliances, which means the possibility to reorganize, or to takeover, or to dissolve, or to continue, is different between scale alliances and link alliances. And factors related to learning ability and learning oppotunies can play a key role in the formation of asymmetri performance.With an empirical research basing on 104 strategic alliances in auto industry in China, there are some foundings as follows. 1) There are no significant different performance outcome between link alliances and scale alliances. 2) In link alliances, the stronger the absorbing capability of learning is, as well as knowledge management ability of parent companies, the more stable the alliances are. 3) In scale alliances, the stronger the obtaining ability of knowledge is, the more possible they can keep continuing. 4) The earlier the alliances were founded, the less stable they are; the alliances with only two parent companies are less stable than the ones with more than two parents; the alliances with partners holding the same percentage of ownership are less stable than the ones with different stock holdings between partners. 5) The characteristics of parent companies, which are geographic distance between partners, former alliance experience, and relative competition status, have no significant influence on alliance performance. 6) In Chinese auto industry, there are significantly different purposes between domestic parent companies and foreign ones, while no significant differences in the performance change of post-alliances.Based on comparative analysis of purposes and performances of forming alliances between domestic and foreign firms, this paper found that Chinese firms are focusing on learning technologies and management, while foreign firms are focusing on Chinese market when forming alliances with each other. Especially, foreign firms try to protect their core technologies from Chinese counterparts. To some extent, Chinese and foreign firms can make agreements on some strategic objectives like increasing market share and firm profits and get to'win-win'. But when concerning to controlling on some facets of competition, they may make high protection from each other. So, learning ability and corporate systems of risk reduction can play key role.Because most current researches related to strategic alliances focus on developed makets and there is limited studies paying attention to emerging markets, this paper is valueable for domestic empirical researches of strategic alliances. Besides, concentrating on auto industry can provide some useful foundings and suggestions for both Chinese firms and government.