Alliance diversity hinders innovation in emerging economies without strong absorptive capacity.
Firms in emerging countries like Brazil can improve their innovation performance by building alliance portfolios and having a strong absorptive capacity. This means they can work with other companies and learn from them to come up with new ideas and products. By having a high absorptive capacity, firms can make sure that having a diverse alliance portfolio doesn't hurt their innovation. This study shows that it's important for companies in emerging economies to focus on learning and adapting to new information to stay competitive.