Competitive overlap as a signal in expert partner choice: Evidence from patent law firm selection

Geoffrey Borchhardt, Balázs Kovács and Michelle Rogan

Strategic Management Journal, 2025, vol. 46, issue 7, 1557-1605

Abstract: Research Summary In market networks, firms regularly seek partners with needed expertise, but these partners often work with the firms' competitors. How such second‐order competitive overlap affects partner selection is unclear. Prior theory assumes firms view networks as “pipes” and emphasizes flows of competitor information via the shared partner as key in partner selection. We propose that firms also view networks as “prisms” and use competitive overlap as a signal of a potential partner's expertise. Hence, firms may prefer partners with competitive overlap. We find support for our claims in the patent law firm selection context. Furthermore, higher competitive overlap leads to slower patent acceptance but results in broader patents, implying that the competitive overlap expertise signal reduces search costs without significant performance loss. Managerial Summary When selecting expert partners like law firms or consultants, some companies may consider avoiding firms that also serve their competitor. However, when little is known about potential partners, this “competitive overlap” might be a way to assess their quality. We found that firms are more likely to choose patent law firms who work with their competitors. This occurs because a competitor's choice signals that partner's expertise. Companies rely on this signal most when they lack direct experience with potential partners or when entering new technological domains. While working with partners who serve competitors might slightly increase processing times, it can increase patent protection without compromising overall performance. These findings suggest that avoiding partners based solely on competitive overlap may limit access to valuable expertise.

Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
https://doi.org/10.1002/smj.3700

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bla:stratm:v:46:y:2025:i:7:p:1557-1605

Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=0143-2095

Access Statistics for this article

More articles in Strategic Management Journal from Wiley Blackwell
Bibliographic data for series maintained by Wiley Content Delivery ().