Buyer-Supplier and Supplier-Supplier Alliances: Do They Reinforce or Undermine One Another?

To purchase or authenticate to the full-text of this article, please visit this link: http://dx.doi.org/10.1111/j.1467-6486.2007.00748.x Byline: Sergio G. Lazzarini (1), Danny P. Claro (1), Luiz F. Mesquita (2) Abstract: abstract Previous research has portrayed buyer-supplier and supplier-supplier alliances as important mechanisms to foster learning and exchange efficiencies. Controversy remains, however, as to how these alliances interact. While some propose they reinforce one another (e.g. learning in horizontal ties generates positive spillovers to vertical ties), others propose a negative interplay (e.g. when increasing vertical-tie intensity, suppliers may weaken horizontal ties to avoid retaliation from buyers who wish to preserve bargaining power). We empirically test these competing views using survey data from the Brazilian auto-parts industry. In an attempt at reconciliation, we propose that the positive or negative interaction between vertical and horizontal alliances depends on the level of technological uncertainty of goods exchanged. Vertical ties seem to inhibit horizontal ties when technological uncertainty is low; when technological uncertainty is higher, vertical and horizontal ties do not seem to have any meaningful form of interaction. We discuss implications for theory and practice. Author Affiliation: (1)Ibmec Sao Paulo; (2)Arizona State University Article note: Sergio G. Lazzarini, Associate Professor of Organization and Strategy, Ibmec Sao Paulo, R. Quata 300, Sao Paulo, SP Brazil 04546-042 (SergioGL1@isp.edu.br).