Committee Governance in Technology Development Alliances

51 Pages Posted: 27 Mar 2020

See all articles by Marvin Hanisch

Marvin Hanisch

affiliation not provided to SSRN

Jeffrey Reuer

University of Colorado at Boulder

Carolin Häussler

University of Passau

Shivaram Devarakonda

Tilburg University; Purdue University

Date Written: March 20, 2020

Abstract

Steering committees incorporated through contracts serve as important governance instruments for managing complex collaborations by facilitating coordination and knowledge sharing. Although they ease concerns of adapting to unforeseen contingencies, they may not function effectively and become vulnerable to deadlocks when agreement cannot be reached expeditiously. Hence, when partners contract for authority delegation to the steering committee, they also need to account for the possibility of stalemates. We examine the bounds partners agree to put on a steering committee’s authority by contractually specifying the locus of delegated authority in the event of unforeseen contingencies. We specify the conditions that explain the extent to which decision-making authority is given to steering committees as well as the conditions that provisionally shift final decision-making authority in a bounded manner back to one of the alliance partners. We argue that joint coordination concerns increase the likelihood for authority delegation, whereas timely adaptation concerns are associated with authority reversion. We develop hypotheses on the locus of delegated authority and present supportive evidence from empirical analyses of 648 strategic alliances from the bio-pharmaceutical industry. Our study advances research on alliance governance by showing that coordination and decision speed considerations are important drivers for the locus of delegated authority in alliances.

Keywords: alliance governance; administrative control; authority; R&D alliances

JEL Classification: L14, L24, D23

Suggested Citation

Hanisch, Marvin and Reuer, Jeffrey and Haeussler, Carolin and Devarakonda, Shivaram, Committee Governance in Technology Development Alliances (March 20, 2020). TILEC Discussion Paper No. DP2020-006, Available at SSRN: https://ssrn.com/abstract=3557815

Marvin Hanisch (Contact Author)

affiliation not provided to SSRN

Jeffrey Reuer

University of Colorado at Boulder ( email )

1070 Edinboro Drive
Boulder, CO 80309
United States

Carolin Haeussler

University of Passau ( email )

Innstrasse 27
Passau, 94032
Germany

Shivaram Devarakonda

Tilburg University ( email )

P.O. Box 90153
Tilburg, 5000 LE
Netherlands

Purdue University ( email )

West Lafayette, IN 47907-1310
United States
765 494 4517 (Phone)

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