Entrepreneurial Competence and Alliance Success: The Role Knowledge Absorption Effectiveness and Mutual Trust

Abstract

SMEs in similar markets form alliances to enable them to share common resource resources that will increase their ability to innovate and respond to the opportunities and threats in the environment. Existing studies suggest that interfirm partners need to be competent for a successful alliance, while overlooking the mediating role of knowledge absorption effectiveness and the moderating role of mutual trust. Based on data collected from 251 SMEs in the UK, our paper suggests that there is a positive relationship between entrepreneurial competence (EC) and alliance success (AS) that is facilitated by knowledge absorption effectiveness. Also, that mutual trust enhances the strength of the relationship between EC and knowledge absorption effectives. Our study contributes to literature by drawing on a relational perspective of the resource base view to suggest a complex relationship between EC and AS that is explained by a moderated mediation mechanism. We highlight the complex dynamic relationship in an alliance network that will influence successful SME alliances.