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The Dynamics of Soft Factors in Inter-Organizational Collaboration

The paper discusses the basic feedback structures underlying the dynamics of ‘soft’ variables in inter-organizational collaboration. An integrative system dynamics simulation model is used to generate insights into the dynamic processes taking place in the co-operation of two organizational entities. The model is based on a synthesis of results from different research perspectives on the various modes of collaboration. The model focuses on people-oriented, cultural, and knowledge-focused issues, since those are frequently described to cause the major dynamics influencing a co-operation’s trajectory. The system dynamics model allows the simulation of different trajectories depending on the initial characteristics of the two collaboration partners, as well as on the actual management interventions during the process. It thereby creates insights into the possible outcomes of a co-operation, its chances and pitfalls, and thus offers a new approach for evaluating it from a dynamic soft issues perspective. Simulation results for three hypothetical scenarios of inter-organizational collaboration are discussed. The necessity of a soft-factor assessment of potential partners for collaboration is demonstrated. Introduction: Dynamics and Diversity The almost uncountable number of academic studies on settings of inter-organizational collaboration has provided academia with a rich and highly detailed body of knowledge. Research on the different modes of co-operations, e.g. in strategic alliances, joint ventures and mergers or acquisitions, reveals common structural characteristics underlying the dynamics and trajectories of such arrangements. Largely, collaborations induce dynamics in ‘soft’ organizational dimensions, i.e. they influence the employees’ work motivation, change the organizational knowledge base or lead to a significant change in corporate culture. It can be assumed that different modes of collaborations share certain causal structures underlying the