Performance feedback and change in R&D alliance portfolio breadth: The moderating role of economic conditions
Shiko M. Ben-Menahem, Martin Woerter, Georg von Krogh
Strategic Management Journal · 2026 · Volume 47 · Issue 3
Abstract
We investigate how firm performance feedback and economic conditions (upturns and downturns) impact changes in the breadth of partner types within a firm's R&D alliance portfolio (R&D AP breadth). We theorize that economic conditions moderate firms' motivation to change R&D AP breadth in response to social and historical performance-aspiration discrepancies, and shape whether they respond more strongly to social or historical aspirations. Using cross-industry data on Swiss firms (1999–2020), we find that firms performing below social aspiration are more likely to expand R&D AP breadth during downturns but less likely to do so during upturns. Performance below historical aspiration shows no significant effect once economic conditions are considered. We examine how firms adjust their range of business partners in response to past performance and economic conditions. Analyzing Swiss firms from 1999 to 2020, we find that firms strategically adjust the number of partnership types in response to economic climates. During tough economic times, firms tend to broaden their R&D partnership types when they fall short of peer performance benchmarks. They tend not to do so in prosperous periods under similar performance conditions. We found no consistent effects when performance is benchmarked against the firm's history. These insights help managers strategically navigate alliances under fluctuating economic conditions and underscore the importance of peer-relative performance benchmarks.
Keywords
alliance portfolio reconfiguration, economic environment, organizational adaptation, performance feedback, R&D
Enable JavaScript for citation tools and additional paper interactions.