Towards a multidimensional performance measure for North-South industrial alliances

Abstract

While the question of the success of alliances is a topic that is widely discussed in the literature, the definition of alliance performance and its measurement are still debatable. Previous research has shown that different measures are mostly global, unidimensional, or narrow in scope. However, the literature suggests that only an adequate combination of indicators should address the multidimensionality of alliance performance. Similarly, the validity of the underlying measures is still doubtful. This is more pronounced in the case of North-South industrial alliances, which have received little interest from researchers. This alliance involves companies from developed countries, in particular European or American ones, and firms from developing countries, such as those from North African countries. The study is intended, in the specific context of North-South alliances, to question the alliance performance concept and to evaluate the construct validity of the measures that define it. A second-order alliance performance construct, measured by financial performance, efficiency, learning and reputation, is then proposed. An empirical investigation was conducted among 136 Tunisian companies in the industrial sector. These companies were engaged in alliances with European and American firms. The validity of performance measures is assessed through reliability, convergent validity, and discriminant tests. The results show that the proposed indicators are valid measures corresponding to different and complementary dimensions. The findings obtained can help alliance managers with a toolkit for evaluating alliance success and recommendations for its operation. The research also contributes to the empirical validation of a second-order alliance performance construct, a result considered as original in a Tunisian context.