Firm performance in uncertain times: the importance of networking capabilities

Abstract

PurposeAlthough a body of studies investigates how networking capabilities (NCs) form and maintain interorganizational relationships that affect firm performance, little is known about this relationship in crisis contexts. This article explores managers' perceptions of environmental uncertainties and how this perception influences NC development and subsequent firm performance, especially during the COVID-19 crisis.Design/methodology/approachThe authors used a quantitative research approach to complete this objective, utilizing primary data from a survey of North American firms (N = 212), mostly (62.3%) small- and medium-sized. Data were analyzed via the partial least squares structural equation modeling technique.FindingsThe authors found that managers' perception of environmental uncertainties positively impacts the NCs to initiate and develop relationships, which is associated with better firm performance during crises. The capability to initiate and develop relationships supports the firm's access to relevant resources that may be converted into business performance.Originality/valueBy analyzing managers' perceptions of environmental uncertainties and the development of NCs, the study results expand upon previous research by highlighting that starting new relationships and developing existing ones may be an efficient managerial response immediately after a crisis occurs.