Alliance portfolio management capabilities, corporate entrepreneurship, and relative firm performance in SMEs

ABSTRACT

This article shows how small- and medium-sized enterprises (SMEs) can enhance the level of corporate entrepreneurship through alliance management capabilities. The findings from a sample of 272 suppliers to the mining industry demonstrate that the constituting dimensions of alliance portfolio management capability (that is, partnering proactiveness, relational governance, and portfolio coordination) positively affect corporate entrepreneurship. Moreover, corporate entrepreneurship mediates the effects of these dimensions on firm performance. These findings improve our understanding of how organizational capabilities enable SMEs to mitigate their lack-of-resources problem while engaging in interfirm relationships to better utilize corporate entrepreneurship for increasing firm performance.

KEYWORDS:

• Alliance portfolio management capabilities
• partnering proactiveness
• relational governance
• portfolio coordination
• corporate entrepreneurship
• performance

Notes

¹ https://financialtribune.com/articles/economy-domestic-economy/45,945/smes-comprise-96-of-all-iranian-businesses, https://www.asbfeo.gov.au/sites/default/files/Small_Business_Statistical_Report-Final.pdf.

² For Australia, these were InfoMine (www.infomine.com), Austmine (www.austmine.com.au), mining business industry (www.miningreference.com), and Queensland Mining & Engineering Exhibition (www.queensland.miningexpo.com.au). For Iran we used the Iranian Mining Engineering Organization database (www.ime.org.ir), Iran Industries Information (www.iiinf.com), Iranian manufacturers and suppliers (www.ecasb.com), and the comprehensive portal of Iranian engineering and industry (www.dastad.com) to identify the sample.

³ We excluded microfirms because concepts such as corporate entrepreneurship may be less relevant for firms with less than five employees. We excluded large firms, as our focus was on SMEs. In our sampling context, large firms are considered those over 200 employees. We reran our models with the large firms included and obtained the same results.

⁴ The initial scale developed by Sarkar et al. (2009) entailed five items for measuring relational governance and five items for measuring portfolio coordination. However, through scale validation and purification, Sarkar et al. (2009) used only three item scales for relational governance and portfolio coordination in their empirical analyses. As such, we adopted the three item scales.

⁵ All items of questions related to corporate entrepreneurship and alliance portfolio management capability were measured on a 5-point scale from 1 (strongly disagree) to 5 (strongly agree).

⁶ Items were measured on a 5-point scale from 1 (much worse) to 5 (much better).

Additional information

Funding

This research was supported by the Australian Government through the Australian Research Council's Discovery Projects funding scheme [project DP1096477].