Linking network coherence to service performance: modelling airline strategic alliances

While strategic alliances have been widely recognised as an appropriate governance mode for the co-development of capabilities, the importance of leveraging these capabilities to assemble a network of inter-linked services has been a neglected area of research. We propose network coherence as a construct to capture the degree of service consistency across the networks of the three largest global airline alliances. Employing a multi-dimensional service performance evaluation model, with a data set of over 500 customers, flying on more than 700 routes, the paper examines the impact of network coherence on customer satisfaction and market-based performance variables. The results indicate that network coherence plays a key role in improving service performance and is a useful construct in capturing a number of important service variables for airlines. The paper highlights the importance of knowledge-based capabilities in achieving competitive positioning for alliance members, exposing a number of critical challenges for global alliance networks.