The Impact of Value on Governance Decisions for IT-Based Alliances: Evidence from a Joint Venture in the Wireless Networks Industry

Consideration of cost and resource benefits generated from an alliance have prevailed the theoretical and empirical research about strategic alliances and value networks/Webs. As research in the area advances, strategic and financial theories, such as game theory and real options theory, set the groundwork for investigating the anticipated strategic value for IT-based alliances. This paper presents the theoretical consideration of a research stream building on the premise that strategic value affects not only the formation of alliances but also their governance, denoting the level of commitment that partners wish to have with each other. The paper provides a theoretically-based conceptualization of the expected alliance value and discusses a set of research propositions and hypotheses on the direct and indirect impact of firms´ value expectations on their preference for the alliance governance mode. Finally, using evidence from a case study, it identifies the role of value expectations in an alliance´s shift from contract-based agreement to joint venture