Endogamic Vs Exogamic Partnerships.pdf

100 words): The paper distinguishes between two types of inter-firm alliances: endogamy and exogamy. Endogamy occurs when partners share related profiles. On the opposite, exogamy appears when allies exhibit unrelated profiles. It is suggested that endogamy serves for accumulating similar resources and gaining scale effects while exogamy allows the combination of differentiated competences and the achievement of symbiotic effects. Two different cases are employed to infer practical recommendations regarding how these different types of partnerships should be managed. Inter-firms alliances developed at a tremendous rate over the last twenty years. This has been the case in the Western world as well as in emerging countries. All alliances are not equal. As a result, they should be managed in different ways. Managers must pay attention to the type of alliance they get into to adopt the most appropriate behaviour. The question that stems from this assertion is: What are the different types of alliances? It is quite common to differentiate between national and international alliances. Analysts also distinguish alliances according to the type of organizational arrangements, the stages of the value added chain covered by the deal, the absence or the presence of equity links in the agreement, the relative size of the partners, etc. (Ruffio et al., 1999). All these distinctions are obviously important to consider, but they do not address the main issue raised by inter-firm alliances: What are the motives for setting up an alliance? Which benefits are the partners looking for when they enter a cooperation agreement? This paper is based on the idea that the benefits gained – thanks to the alchemy of cooperation – are a function of what each of the partners pools into the alliance. Obviously, the less you bring, the less you get. But the question does not relate solely to quantities of resources. In line with the increasingly popular resource-based theory1, this paper puts the emphasis on the nature of the resources brought by the partners. According to the relatedness between the resources polled by each partner, the cooperation will produce very different sets of complementarities. I will show that these complementarities may be either quantitative – when resources are related, or qualitative – when resources are unrelated. This criterion leads to two archetypes of alliances: endogamy and exogamy. We will see that endogamy refers to alliances between associates that are close. While, on the contrary, exogamy is the marriage with some outsiders. 1 See: Wernerfelt, 1984; Hamel & Prahalad, 1990; Barney, 1991; Grant, 1991; Stalk et al., 1992; Leonard-Barton, 1992.