The study of knowledge and networks is not limited to how knowledge and knowledge transfers manifest in networks. As managing networks is fraught with difficulty, studies increasingly focus on the benefits of developing network capabilities. Research in social networks has focused on how relational capability increases the efficacy in which actors operate in their networks (Kale et al., 2000). Likewise, in the context of alliances, studies show that firms with alliance capabilities are more successful in their alliances (e.g. Anand and Khanna, 2000; Dyer et al., 2001; Kale and Singh, 2007; Lyles, 1988). As firms enter into alliances and alliance networks, they gain alliance experience. In their study of alliances in the manufacturing sector, Anand and Khanna (2000) found that firms learn to create more value as they accumulate experience, but only in the context of more extensive forms of collaboration, such as joint ventures. Since experience builds cumulatively, firms may become inert and may misattribute it across different contexts. Hence, firms need to learn from their experience and build know-how (Dyer et al., 2001; Kale and Singh, 2007), particularly of different alliance phases, such as partner search, negotiation, alliance management, and learning (Simonin, 1997). Gulati (1999) found that greater network alliance formation capabilities increase the chance that firms enter into alliances in the future (see also, Lyles, 1988). On the basis of a longitudinal case study, Lorenzoni and Lipparini (1999) proposed that the capability to interact with other firms improves learning and knowledge access and transfer. Simonin (1999) found that collaborative knowledge mitigated the negative effects of knowledge complexity, as well as the detrimental effects of cultural and organizational distance on learning.
The positive benefits gained through alliance capabilities have led many firms to develop a unit or multiple units dedicated to the alliance function (Hoffmann, 2005; Kale et al., 2002). In the context of alliance learning, ‘knowledge consists . . . also of the know-how regarding cooperation . . . [and] of identifying who will cooperate and who has what capabilities’ (Kogut et al., 1993: 77). A unit devoted to managing a firm’s alliances facilitates the articulation, codification, sharing, and internalization of experiences learned in various alliances, provides a central point to develop alliance capability, and subsequently leads to greater alliance success (Kale and Singh, 2007). By creating and integrating alliance knowledge in a special unit, firms seek to increase external visibility, to enhance internal legitimacy, to provide internal coordination, to intervene in alliances (Dyer et al., 2001), and to facilitate alliance portfolio management (Hoffmann, 2005). These capabilities determine the efficacy in which firms act as hubs in an alliance network (Dhanaraj and Parkhe, 2006). However, a firm enters into alliances often at the business unit or subsidiary level. As a consequence, the degree to which a firm can learn from its various alliances is determined by a firm’s internal knowledge sharing process. The sharing of knowledge that organizational networks facilitate at the same time facilitates the development of new alliance networks. In that sense, an alliance function serves as a tertius iungens in that it introduces disconnected units within the organization and facilitates new coordination among them as well as among a firm’s alliance partners (cf. Obstfeld, 2005).