DO THE STRUCTURAL ATTRIBUTES/CHARACTERISTICS OF INDUSTRIES INFLUENCE THEIR DECISION TO UTILIZE STRATEGIC ALLIANCE?

Year 2022, , 332 - 339, 31.10.2022

Victor Nwokocha

https://doi.org/10.24289/ijsser.1129393

Cited By: 1

Abstract

Strategic alliance is a cooperative agreement among industries. This cooperative agreement is targeted at achieving short, medium and long term benefits by industries. On the other hand, the structural attributes or characteristics of an industry is the intrinsic traits or features of such an industry which often play a crucial role in their decision making process. It is determined by size, age, inputs, capacity utilization, asset base, ownership structure etc. This study assessed the structural characteristics of industries and their influence in the decision to utilize strategic alliance by industries. A survey research design and a questionnaire survey of 309 industries were used in the study while percentages and tables were used to analyse the data and show results. Based on the structural characteristics of the surveyed industries, two types of industries were found in the study. These are small scale industries with 5 - 49 workers and medium scale industries with 50 - 199 workers. The result also indicated that 68% of the surveyed industries were small scale industries while 32% were medium scale industries. In area of strategic alliance decisions, the study discovered that strategic alliances were utilized by industries of all sizes. Consequently, this paper has shown that strategic alliance play essential role in the production activities of small scale industries. The paper suggests that industrial policies of government should be targeted at encouraging the potentials of small and medium scale industries.

Keywords

Strategic Alliance, Structural characteristics of industries, Industries, Small scale enterprises, Medium scale enterprises, Firm size, Asset base, Ownership structure

Do industries' structural attributes/characteristics influence their decision to utilize strategic alliances?

Abstract

This study assessed the structural characteristics of industries and their influence in the decision to utilize strategic alliance by industries. A survey research design and a questionnaire survey of 309 industries were used in the study while percentages and tables were used to analyse the data and show results. Based on the structural characteristics of the surveyed industries, two types of industries were found in the study. These are small scale industries with 5 - 49 workers and medium scale industries with 50 - 199 workers. The result also indicated that 68% of the surveyed industries were small scale industries while 32% were medium scale industries. In area of strategic alliance decisions, the study discovered that strategic alliances were utilized by industries of all sizes. Consequently, this paper has shown that strategic alliance plays an essential role in the production activities of small-scale industries. The paper suggests that industrial policies of government should be targeted at encouraging the potentials of small and medium scale industries.

Keywords

Strategic Alliance, Structural characteristics of industries, small and medium scale enterprises, Firm size, Asset base, Ownership structure

References

• Akingbade, W. A. (2015). Competitive strategies and improved performance of selected Nigeria telecommunication companies. Entrepreneurship and Performance of Firms, Anna Ujwary-Gil, Krzysztof Klincewicz
• Akinrata, E.B; Ayo,T; Ayotund, A.B & Bodunde, F.I (2020) Evaluating the effect of strategic alliance procurement method on construction financial performance in Nigeria. Proceedings of the 2nd African International Conference on Industrial Engineering and Operations Management Harare, Zimbabwe, December pp 7-10,
• Akinyomi, O. J., & Olagunju, A. (2013). Determinants of capital structure in Nigeria. International Journal of Innovation and Applied Studies, 3(4), 999-1005.
• Aun, I.I (2014). Effect of strategic alliance on the performance of manufacturing companies in Nigeria. Journal of Resources and Industrial Development 12 (2) pp 435- 456
• Babalola, Y. A. (2013). The effect of firm size on firms profitability in Nigeria. Journal of economics and sustainable development, 4(5), 90-94.
• Cheng, S.(2015). Potential lending discrimination? insights from small business financing and new venture survival. Journal of Small Business Management 53: (4) pp 905 923.
• Diaz-Mora, C., & Triguero-Cano, A. (2007). Why do some firm contract out Production? Evidence from the firm-level panel data. Albacete: Department of International Economics, Faculty of Juridical and Social Science, University of Castilla-La Mancha Albacete Spain.
• Ejekwu, K., 1 Zeb-Obipi, I., & Uhuru, G. P. (2020). Operation sensitivity and strategic alliance success in Nigerian manufacturing companies Port Harcourt. The Strategic Journal of Business Change Management 7(1) pp495 – 504
• Ekpudu, J. E, Aigbepue, S & Olabisi J. O. (2013). Appraisal of Strategic Alliances and Corporate Effectiveness, African Research Review: An International Multidisciplinary Journal, Ethiopia 7 (1), pp155-164
• Emami, A., Welsh, D.H.B., Davari, A. & Rezazadeh, A (2022). Examining the relationship between strategic alliances and the performance of small entrepreneurial firms in telecommunications. International Entrepreneurship Management Journal (2022). https://doi.org/10.1007/s11365-021-00781-3
• Emmanuel, Z., Anga, R. A., & Isa, C. G. (2019). The Determinants of Micro, Small and Medium Enterprises’ (MSMEs) Performance in Nigeria: Evidence from Business Enterprise Survey
• Ferreira, A., Franco, M. and Haase, H. (2021). Strategic alliances and development of intellectual capital: a study of technology-based SMEs, International Journal of Organizational Analysis https://doi.org/10.1108/IJOA-10-2020-2440
• Ferreira, A. and Franco, M. (2020), "The influence of strategic alliances on human capital development: A study applied to technology-based Industries, EuroMed Journal of Business, 15(1), pp.
• Gundolf, K; Jaouen, A & Gast, J (2018) Motives for strategic alliances in cultural and creative industries. Journal of Creative and innovation Management, 27(2) 148-160 65-85. https://doi.org/10.1108/EMJB-04-2019-0052
• Hosseini, M., Brege, S., & Nord, T. (2018). A combined focused industry and company size investigation of the internationalization-performance relationship: The case of small and medium-sized enterprises (SMEs) within the Swedish wood manufacturing industry. Forest Policy and Economics, 97 (1), 110-121.
• Junaidu, A.S, Bature, G, & Zuru, N.L (2019) Strategic alliance and performance of textile industry: empirical evidence from Kano, Nigeria. International Journal of Research and Scientific Innovation (IJRSI) 6(5) pp 238-245
• Kafigi, J. (2015). Strategic Alliance Typology and Survival Chances among Medium-Sized Manufacturing Firms in Tanzania, Journal Competitiveness 7: (2), pp. 38 - 48
• Liang,J. (2021) Research on the institutional advantages of enterprise strategic alliance.World Wide Journal of Multidisciplinary Research and Development 7(11): pp 36-39
• Muange, R, & Maru, L.C (2015) Strategic alliances on performance of retail firms in Nairobi County, Kenya", The TQM Journal, 27 (6), pp.732-740
• Muange, R.M & Kiptoo, N.W (2020) Moderating effect of firm size on the relationship between joint marketing alliances and firm performance of retail firms in Nairobi County, Kenya. International Journal of Research and Innovation in Social Science 4(8) pp 273-284
• Nwokocha, V.N (2020). The influence of strategic alliance on the performance of small and medium scale enterprises in Enugu State Nigeria. Unpublished Ph.D thesis of the Department of Geography, University of Nigeria Nsukka
• Nwokocha, V.N and Madu, I.A (2020). The influence of strategic alliance on the performance of small and medium scale enterprises in Enugu State Nigeria. Global Journal of Emerging Market Economies 12(2) 199-216
• Nwokocha V.C. (2021) Small and medium scale enterprises and the utilization of strategic alliance: The effect of spatiality in emerging markets economy. Production and Manufacturing Research 9(1) pp 264-280
• Nwokocha V.C, Anyanwu O.C, Madu I.A, & Nwankwo C.E. (2021) COVID-19 pandemic and small-scale industries in a local geographic space of Nigeria: An assessment of the impact of strategic interfirm alliance. SAGE Open. doi:10.1177/21582440211022676
• Olawale, L. S., Ilo, B. M., & Lawal, F. K. (2017). The effect of firm size on performance of firms in Nigeria. Aestimatio: The IEB International Journal of Finance, (15), 68-87.
• Ogunkoya, O.A., Hassan, B., Elumah., L.O & Kareem, Q. (2015). Network process, strategic alliance and performance: empirical evidence from Nigeria. Information and knowledge management, 5 :(5) pp. 104-114
• Patchged, P. (2013).SME strategic alliance relationship management - motivation and performance of strategic alliance: The Study from SMEs in Thailand. (Published M.Sc Thesis) Thai Univesity, Thailand
• Prabhudesai, R., Pangarkar, N. and Prasad, C.V.V.S.N.V. (2022). Resource type and SME alliance formation: the contingent role of perceived environmental uncertainty, Journal of Small Business and Enterprise Development, https://doi.org/10.1108/JSBED-02-2021-0046
• Todeva, E. & Knoke, D, (2005). International strategic alliance dynamics. Working Paper, School of Management, University of Surrey, Guidford, Surrey, United Kingdom
• Umukoroa, F. G Sulaimonb, A.H. A & Kuyeb, O. L (2009) Strategic alliance: an insight into cost of structuring, Serbian Journal of Management 4 (2) pp 215 – 226 Varis, M. & Littunen, H. (2010), Types of innovation, sources of information and performance in entrepreneurial SMEs. European Journal of Innovation Management, 13(2), pp.128-154.