Testing the waters: Using collective real options to manage the social dilemma of strategic alliances

Matthew W. McCarter, Joseph T. Mahoney, Gregory B. Northcraft

Research output: Contribution to journalArticle

Abstract

We extend real options research by introducing the concept of collective real options and model how collective real options provide strategic alliances a mechanism to manage social uncertainty. Collective real options manage social uncertainty by producing relational small wins that develop trust. The amount of trust developed by acquiring a collective real option depends on the exposure of alliance partners. Alliance partner reputation also plays an important role in the impact of collective real options.

Original languageEnglish (US)
Pages (from-to)621-640
Number of pages20
JournalAcademy of Management Review
Volume36
Issue number4
DOIs
StatePublished - Oct 1 2011

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ASJC Scopus subject areas

  • Business, Management and Accounting(all)
  • Strategy and Management
  • Management of Technology and Innovation

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