Decision Maker Orientation, Environmental Uncertainty and the Governance Alliances of Privately Held Firms

This study proposes that decisions by owners and managers of small- to medium-sized enterprises regarding whether to adjust their overall governance in the form of equity-based or agreement-based alliances are significantly influenced by fundamental differences in how they view the uncertainty of their environments and their propensities towards risky and proactive behaviour. A number of propositions are tested using a model with data from 686 SMEs in Eastern Australia, Central America and Northern Europe. Results suggest that managers' perceptions of the uncertainty in their environments and their orientations towards risky and proactive behaviour do influence their choice of alliance structures but do so in differing and interesting ways across regions.