Finance

Business

Knowledge management

Application portfolio management

Marketing

Political science

Artificial intelligence

Management

Project management

Economics

Portfolio

Alliance

Diversity (politics)

Computer science

Industrial organization

Project portfolio management

Selection (genetic algorithm)

Journal of Management Studies

This study seeks to explain how the innovation potential entailed in the structural characteristics of a diverse alliance portfolio can be leveraged by two different alliance management capabilities of a focal firm: portfolio coordination and proactive partner selection. An analysis of German biotechnology firms, based on database and survey data, indicates that each alliance management capability positively interacts with portfolio diversity to foster innovation. In addition, regarding their joint influence as capability bundle on the portfolio diversity–innovation link, portfolio coordination and proactive partner selection seem to substitute rather than complement each other. These results suggest that firms realize innovation benefits from a diverse set of external alliance partners only when they focus on and apply internal coordination or partner selection routines to manage these alliances, thus acting as either portfolio coordinators or portfolio configurators.

Alliance Portfolio Diversity and Innovation: The Interplay of Portfolio Coordination Capability and Proactive Partner Selection Capability