Correspondence: Francisco Rocha Gonçalves, ISCA-UA Apartado 58 Aveiro 3811-902 Portugal. Tel: +351 9339 21778; Fax: +351 2343 80111; e-mail: francisco.goncalves@ua.pt

¹is an Adjunct Professor of Management at ISCA-UA – the Accounting and Management Institute of Aveiro University, Portugal. He currently serves as vice-dean of this institute and supervises its graduate studies in marketing. In order to obtain his PhD in management (in May 2007), from the Technical University of Lisbon (UTL), he has been conducting research in strategic management and strategic alliances and in its applications in the healthcare industries.

²is a Full Professor of ISEG-UTL. He also serves as Vice-Rector of the Technical University of Lisbon. He has taught and published widely in the fields of management and, chiefly, strategic management. Having earned his earlier graduation in management in ISEG, in 1987 he obtained a PhD in management from the University of Sevilla, Spain. Among his academic roles, he has supervised several research projects, including the one from the associate author of this paper.

Received 6 September 2007; Revised 6 September 2007.

Abstract

This paper aims to improve knowledge about the relationship between strategic alliances and performance. It begins by proposing a moderating role for the alliance management capability. Next, it advances an explanation of the impact of the alliances on performance, which is based on the firms' ability to deploy their product portfolios and their alliance portfolios. The research hypothesis formed a structural model that was tested using partial least squares (PLS). The context for the empirical application was the Portuguese pharmaceutical industry. The results confirmed that the proposed moderating role is significant. Additionally, alliances are effectively used for growing and for innovating. Generic drugs are an important way to reconfigure the firms' portfolios and to explain performance; however, they do not significantly depend on alliances. The main lessons are: (a) a better understanding of the reasons 'why' alliances enhance performance; (b) managers should develop their firms' alliance management capabilities, in order to fully exploit the benefits of alliance; and (c) a sensible criterion for firms to evaluate the potential alliances is to evaluate the alliance's ability to leverage growth and innovation.