Digitalization and the inception of concentric strategic alliances: A case study in the retailing sector

• Author: Carlos Galera‐Zarco,Josip Marić,Maria García‐Feijoo,Marco Opazo‐Basáez
• DOI: http://doi.org/10.1002/jsc.2319
• Date: 01 March 2020
• Published date: 01 March 2020

RESEARCH ARTICLE

Digitalization and the inception of concentric strategic

alliances: A case study in the retailing sector

Carlos Galera-Zarco

1

| Marco Opazo-Basáez

2

| Josip Mari

c

3

| Maria García-Feijoo

2

1

Coventry Business School, Coventry

University, United Kingdom

2

Deusto Business School, University of

Deusto, Spain

3

Karlsruhe Institute of Technology, Germany

Correspondence

Carlos Galera Zarco, Coventry Business

School, William Morris Building, Gosford

Street, Coventry, CV1 5ED, United Kingdom.

Email: carlos.galerazarco@coventry.ac.uk

Abstract

Firms in multiple sectors are incorporating information technology (IT) partners to

gain digital capabilities, improve their operations, and offer new value propositions.

The deployment of digitalization in well-established firms from traditional sectors

enables the creation of specific strategic alliances (concentric) with IT providers.

However, establishing these particular strategic alliances with an IT provider raises

tensions and reconsiderations both at the internal level and within the alliance as a

consequence of the profound organizational challenges that both digitalization and a

strategic alliance imply. This study analyzes how digitalization influences the emer-

gence of these new strategic alliances, highlighting the process and key factors that

have contributed to its success at our unit of study in the retailing sector.

1|INTRODUCTION

Digitalization is progressively transforming firms' strategies and fos-

tering business operations redesign (Bharadwaj, El Sawy, Pavlou, &

Venkatraman, 2013; Iansiti & Lakhani, 2014). However, the rapid

development of digital technologies, along with intensified industrial

competition, has translated into greater uncertainty for firms

(Gimpel & Röglinger, 2015), which has led companies to engage in

new forms of cooperation to access resources located outside their

boundaries (Cassiman & Veugelers, 2006; Gebauer, Paiola, & Saccani,

2013; Perks & Moxey, 2011). Entering into strategic alliances implies

that a company can access another company's resources and activi-

ties, which were initially out of its reach.

However, in turn, the company yields control over its own activi-

ties and resources (Gomes, Angwin, Weber, & Tarba, 2013;

Håkansson & Snehota, 1989; Junni, Sarala, Taras, & Tarba, 2013).

In this context, lack of digital capabilities seems to be an impor-

tant enabler for mature companies deciding to set up collaborative

methods of development (Bigdeli, Bustinza, Vendrell-Herrero, &

Baines, 2018; Goes & Park, 1997; Tarba, Ahammad, Junni, Stokes, &

Morag, 2019; Tether, 2002). However, IT firms interacting with well-

established companies are gaining access to new markets and useful

customer information (Rickne, 2006). Therefore, an increasing number

of inter-firm collaboration driven by digital transformations and the

need to obtain the envisaged benefits of their implementation is

expected. In such circumstances, strategic alliances become an impor-

tant success factor for digital innovation in industrial settings

(Pagani, 2013).

Transparency and certainty in value perception (Jaakkola &

Hakanen, 2013; Möller & Halinen, 1999), as well as the realization of

the importance of the strategic alliance for the firm's own strategic

objectives, have been pointed out as key factors for success in inter-

firm collaboration (Gomes, Weber, Brown, & Tarba, 2011; Möller &

Svahn, 2009). However, the emergence, specific characteristics, and

potential success of new inter-firm business relationships driven by

recent digital development is still unclear and requires further in-

depth analysis (Pagani & Pardo, 2017).

Although the digitalization phenomenon is increasingly discussed

in the literature (Henriette, Feki, & Boughzala, 2015; Vendrell-Her-

rero, Gomes, Collinson, Parry, & Bustinza, 2018), there are still few

studies that deal with the impact of digitalization on well-established

firms' decisions to embrace strategic alliances. To this aim, a leading

Spanish group in the food retail sector has been selected as a unit of

analysis. Following a single-case study methodological approach, we

intend to clarify the development process of a concentric strategic

alliance driven by the digitalization phenomenon.

Therefore, in this article, we aim to shed light on how the digitali-

zation process influences the decision to enter into strategic alliances

JEL Classification codes: L14, M15, O33.

DOI: 10.1002/jsc.2319

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