Heuristics and Cognitive Bias in Reconfiguring Cooperation Modes of Industry‐University‐Research Alliances Portfolio: Roles of Innovation Performance Feedback Under <scp>CEO</scp> Hubris

ABSTRACT In an era of open innovation, the industry‐university‐research alliance portfolio (IURAP) has emerged as a core strategic asset for firms to access critical knowledge and navigate technological uncertainty. Given that the cooperation modes in the IURAP can lead to diversified benefits and risks for firms, firms must dynamically configure these modes. Based on the behavioral theory of the firm, this study explored how innovation performance feedback as behavioral drivers to influence the reconfiguration of their IURAP cooperation modes while accounting for the moderating role of the cognitive bias of key decision‐makers (CEO hubris). This study uses a Heckman two‐stage model fed with data from 152 pharmaceutical manufacturing firms in China. The findings reveal that firms with below‐aspiration innovation performance feedback are inclined to increase the dissimilarity of IURAP cooperation modes, with CEO hubris alleviating the propensity to increase this dissimilarity. In contrast, firms with above‐aspiration innovation performance feedback reduce the dissimilarity of their IURAP cooperation modes, with CEO hubris intensifying the propensity to reduce the dissimilarity. This study contributes to alliance‐portfolio research by deconstructing the reconfiguration process from the lens of bounded rationality, integrating both behavioral heuristics and cognitive biases to explain strategic decision‐making on collaborative innovation.