Impact of stakeholder management in collaborative partnerships of small and mid-size firms in joint development projects

Stakeholder Management Theory has provided a platform for analysis of both internal and external relationships of the firm (Freeman, 1984). The basis of Stakeholder Management Theory (or Stakeholder Theory) for this study is seen as a complex network (or groups) of external business relationships that redefine the nature of how a firm successfully operates and interacts with other stakeholder groups when faced with a myriad of competitive challenges in an increasingly complex and global marketplace (Wicks, Glibert, and Freeman, 1994). This study focused on the impact of stakeholder management in collaborative business partnerships of small and mid-size firms in joint development projects or ongoing operations. For this research, collaborative business partnerships is defined as the strategy that occurs when two or more companies form a temporary or permanent formal or informal arrangement for the purpose of capitalizing on some type of opportunity, sharing resources, generating revenue, or reducing expenses that one company alone could not achieve (Porter, 1998). We also define joint development projects or ongoing operations as business partnerships between two or more firms in an effort to obtain some type of competitive advantage that one individual company alone cannot reach (Harrigan, 1986; and Porter, 2008). Current research on the success of collaborative relationships has focused on factors, such as resource allocation, executive leadership, and strategic planning for large corporations with extensive professional resources (Harrison, 1994). This research stream does not encompass, however, the impact of resource allocation and competitive positioning decisions of small-to-medium-sized firms with limited resources engaged in collaborative development projects involving multiple business partners with often substantial investment funding. A composite stakeholder process flow model has been developed to capture these relationships. This case study evaluation used a cross-sectional executive interview process of business owners and plant managers of approximately six small to mid-size firms in various industries related to transportation logistics networks in a Midwestern metropolitan area. It endeavored to gain an insightful view of how these relationships actually work. Specifically, qualitative analysis methods were used to evaluate how the proposed composite model can help determine 'best thinking' in the relationship of various stakeholder management processes, such as resource allocation and competitive positioning strategy factors, in enhancing sustainable project success for collaborative business partners. Implications for theory, practice, and future research are discussed.