Cooperative Strategies in Non-High-Tech New Ventures: An Exploratory Study

By Brush, Candida G.; Chaganti, Radha | Entrepreneurship: Theory and Practice, Winter 1996 | Go to article overview

Cooperative Strategies in Non-High-Tech New Ventures: An Exploratory Study


Brush, Candida G., Chaganti, Radha, Entrepreneurship: Theory and Practice


Cooperative strategies are of growing interest in entrepreneurship. Current research focuses on high-tech companies, but less is known about cooperative activities in non-high-tech businesses. Differences in distinct competencies based on technology suggest that lessons from high-tech companies may not fully apply to non-high-tech companies. This research explores the nature, extent, and approaches to cooperative strategies in non-high-tech new ventures, utilizing quantitative and qualitative methods. Survey data is analyzed to assess usage and characteristics of cooperative strategies. Results show that few companies used cooperative strategies and these were not central to core operations. Field interviews comparing three non-high-tech and three high-tech new ventures examine motives and approaches to cooperative strategies. For all six cases, resource constraints motivated usage of cooperative strategies and all had cooperative arrangements with competitors. However, goals and approaches to cooperative strategies differed between non-high-tech and high-tech businesses. Findings suggest future research directions.

Cooperative activities, partnerships, and alliances are gaining popularity in new and small businesses. "Resource pooling, sharing of facilities, equipment and personnel" are common among small companies and business incubators (Wall Street Journal, 1992), while high-technology companies often participate in co-marketing, joint research, and distribution agreements (Boston Globe, 1992). Anecdotal evidence suggests small companies in local geographic areas are sharing customer lists, equipment, and information or "teamnetting" to accomplish things they cannot do individually (De Molt, 1994). Venture Economics of Massachusetts counted 14,000 large-small company alliances nationwide, predominantly among high-tech companies (Boston Globe, 1992). Securities Data Co. of Newark, N.J., estimates a 25% increase in small business partnerships over the last decade (Nation's Business, 1996), New ventures can enjoy multiple benefits from cooperative activities, such as sharing scarce resources, conserving costs, gaining access to key distributors, customers, and markets (Jarillo, 1989), or reducing risk and creating legitimacy (Larson, 1991).

Existing research on cooperative arrangements in entrepreneurship focuses primarily on high-tech companies (McGee, 1993, Forrest, 1990, Esposito, loStorto, & Raffa, 1993: Hatfield & Pearce, 1994). This emphasis may be due to the industrial context of some high-tech businesses where cooperation becomes a necessity, For instance, biotech firms encounter certain pressures to share technological know-how as a means of facilitating new product development leading to patent protection or first mover advantage (Barley, Hybels & Freeman, 1992, Deeds & Hill, 1996). Although high-tech new ventures comprise a comparatively small proportion of new firms (Kirchoff & Phillips, 1989), they are an appealing research topic because of their superior growth performance.

Logically, non-high-tech new ventures should have as much to gain from cooperative alliances as high-tech new ventures. If anything, need may be higher among non-high-tech new ventures because many of these firms operate in retail and personal services sectors that are crowded, intensely competitive, and offer limited opportunities for growth (The State of Small Business, 1993). Technological barriers to imitation also may be fewer, making it difficult to create and maintain a competitive advantage. Overall, failure may be more common in nonhigh-tech sectors such as retailing or personal services than in the high-tech sectors such as biotechnology, telecommunication, or software development (Roberts, 1991: Vesper, 1990). Hence, partnerships with stronger players can help non-high-tech new ventures to overcome some of these disadvantages. Putting this in a value chain framework, cooperative strategies enable new ventures to link their value chains to those of stronger partners, and thus provide superior value to their customers. …

The rest of this article is only available to active members of Questia

Sign up now for a free, 1-day trial and receive full access to:

  • Questia's entire collection
  • Automatic bibliography creation
  • More helpful research tools like notes, citations, and highlights
  • Ad-free environment

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

Cooperative Strategies in Non-High-Tech New Ventures: An Exploratory Study
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Full screen

matching results for page

Cited passage

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited passage

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.