Do Small and Medium‐Sized IT Firms Form Service Partnerships with Nonlocal IT Firms? An Assessment of Facilitators.

For small and medium-sized information technology firms (IT SMEs), the service partnershipsformed with other IT firms are strategic instruments to overcome their resource constraints,increase efficiency, and offer complementary services to their customers. Although these firms havea tendency to form local partnerships due to ease of trust building, few of them are engaged innonlocal partnerships. This research aims to explore the facilitators of this divergent firm behavior.The findings suggest that a firm’s alliance capabilities and organizational proximities betweendistant partners can substitute the lack of geographical proximity and enable IT SMEs’ engagementin nonlocal service partnerships. More importantly, the type of IT service rendered through thepartnership acts as a moderator and determines the extent of the organizational capabilities andproximities