International strategic alliance failure: The lived experience of international business practitioners in Sub-Saharan Africa

Abstract

International strategic alliances are seen as popular mechanisms for new market entry and gaining access to resources and technology. Despite their popularity, the failure rate of strategic alliances still remains high. The causes of strategic alliance failure are not clearly understood in academic literature. Using an anchoring theory of transaction cost economics and opportunism, this study investigated the topic of strategic alliance failure. This is further supported by Park’s and Ungson's integrative model on strategic alliance failure. Through a phenomenology study, the lived experiences of international business practitioners operating in Sub-Saharan Africa were studied. The aim was to create an extension of Park’s and Ungson's model with a specific focus on the opportunism construct. Forms of opportunism found include opportunism as intentional deceit, benevolent preference reversal, good faith reprioritisation, over-commitment, and lastly identity-based discordance. The reasons for alliance failure include poor partner and cultural fit, inappropriate governance, misalignment of expectations, noncommitment of roles and responsibilities, and lastly adverse macroeconomic conditions. These findings are relevant amongst the heavy industrial sector in Sub-Saharan Africa with prominent representation from Nigeria, Kenya, and South Africa