This work studies the performance of a cooperative network which consists of two channel-coded sources, multiple relays, and one destination. To achieve high spectral efficiency, we assume that a single time slot is dedicated to relaying. Conventional network-coded-based cooperation (NCC) selects the best relay which uses network coding to serve the two sources simultaneously. The bit error rate (BER) performance of NCC with channel coding, however, is still unknown. In this paper, we firstly study the BER of NCC via a closed-form expression and analytically show that NCC only achieves diversity of order two regardless of the number of available relays and the channel code. Secondly, we propose a novel partial relaying-based cooperation (PARC) scheme to improve the system diversity in the finite signal-to-noise ratio (SNR) regime. In particular, closed-form expressions for the system BER and diversity order of PARC are derived as a function of the operating SNR value and the minimum distance of the channel code. We analytically show that the proposed PARC achieves full (instantaneous) diversity order in the finite SNR regime, given that an appropriate channel code is used. Finally, numerical results verify our analysis and demonstrate a large SNR gain of PARC over NCC in the SNR region of interest.