Ferguson, manager perceptions of their ?nancial and

Ferguson, Paulin, Moslein, & Muller, 2005were examined the effect of Relational governance on the performance of?nancial partnerships to compare biotechnology manager assessments of their?nancial and non-?nancial partnerships. They have conducted a structuralinterview to collect data and the respondents were chief executive, operationsor ?nancial of?cers of 79 emerging biotechnology companies and 36 leadinvestors in Germany, Canada, and France.

They found that Relational governanceis positively linked with performance. Relational governance was measured byrelational norms such as ?exibility, information sharing, solidarity andfairness, and performance was measured by overall effectiveness and partnershipbene?ts. To assess the relationship between the two variables, they have beenfollowed three main steps, First, the influence of relational governance onpartnership efficiency and bene?ts was examined. Second, for the ?nancialcorporations, the perceptions of both biotech managers and lead investors werecompared. Third, the biotech manager perceptions of their ?nancial andnon-?nancial partnerships were analyzed. Weclearly demonstrate the importance of social embeddedness in the economicactivities of ?rms in clusters of emerging biotechnology companies. The higherthe parties assess the degree of relational governance in biotechnologypartnerships, the greater are the perceptions of the overall effectiveness andthe derived bene?ts.

Therefore, these close, collaborative, fast-developing andrelatively short-lived partnerships can also bene?t from effective relationshipmanagement. Among four dimensions of Relational Governance, Communication (informationsharing) was found out as the most predictive variable on partnership performanceaccording to Ferguson, Paulin, Moslein, & Muller(2005). Also, they viewed that the financial partnership of biotechmanagers is to be less relational compared to their non-financial partnerships.