Integrated Information Systems, Risk Sharing and Alliance Risk

48 Pages Posted: 16 Aug 2011 Last revised: 20 Jul 2014

See all articles by Margaret H. Christ

Margaret H. Christ

University of Georgia - Terry College of Business

Andreas I. Nicolaou

Bowling Green State University - Accounting & Management Information Systems

Date Written: November 2011

Abstract

We examine whether the implementation of formalized controls in strategic alliances is aligned with the extent to which firms integrate their information systems to share information with alliance partners and share risks in an alliance. We theoretically develop the effects of information system integration (ISI) and risk sharing on management’s perceptions of alliance risk (i.e., perceived performance and relational risks) and performance, and include moderating effects of alliance formalization. We find that ISI is associated with relational, but not with performance risk. As alliance formalization increases, however, this effect decreases. Risk sharing is negatively related to both relational and performance risks, while these risks increase when risk sharing is high and the alliance is formalized. Perceptions of alliance risk influence both alliance commitment and performance. Our findings provide insights of how controllable characteristics of alliance relationships (i.e., extent of ISI and risk sharing) affect perceptions of alliance risk and performance.

Suggested Citation

Christ, Margaret H. and Nicolaou, Andreas I., Integrated Information Systems, Risk Sharing and Alliance Risk (November 2011). AAA 2012 Management Accounting Section (MAS) Meeting Paper. Available at SSRN: https://ssrn.com/abstract=1909565 or http://dx.doi.org/10.2139/ssrn.1909565

Margaret H. Christ (Contact Author)

University of Georgia - Terry College of Business ( email )

Athens, GA 30602-6254
United States
706-542-3602 (Phone)

Andreas I. Nicolaou

Bowling Green State University - Accounting & Management Information Systems ( email )

Bowling Green, OH 43403
United States
419-372-2932 (Phone)
419-372-2875 (Fax)

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