Alliance Portfolio Diversity and Dominant Logic Theory

Abstract

Alliance portfolio diversity has emerged as a topic of considerable researchinterest. Two central questions remain: why are some firms are better at managingalliance portfolio diversity than others, and does the form of alliance portfoliodiversity matter? I develop a framework using dominant logic theory to explorethese questions. I distinguish related alliance portfolio diversity from unrelatedalliance portfolio diversity, and argue that when a firm engages in related allianceportfolio diversity strategy that matches its dominant logic(s), it will experiencegreater performance. I expect that firms lacking a prominent dominant logic willengage in unrelated alliance portfolio diversity. I also argue that if firms engage inrelated alliance portfolio diversity in an area(s) that does not match its dominantlogic(s), there will be a mismatch, triggering a reduction in firm performance and thedevelopment of a new dominant logic. Finally, I offer directions for future research.