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The Innovation Process in Alliances

The increasing complexity of business and social settings has lead to innovation becoming a strategic imperative. The need for innovation in the quest for competitive advantage also means that firms must be dynamic and flexible. This is often achieved through collaborative arrangements such as alliances. Many organizations form alliances by leveraging their resources to gain access to the partner's skills and capabilities; ultimately to enhance innovation and performance. We demonstrate empirically that the “chain of innovation” is central to the process of innovation in alliances. This chain comprises the creativity and learning processes and knowledge stock in alliances. Moreover, we show that individual, group dynamic and alliance level factors affect the chain. Our empirical analysis is based on a survey of alliances that resulted in 397 responses.