Business Network Context Research Articles

Entrepreneurial business network and dynamic relational capabilities: a case study approach

PurposeTo further extend the understanding of the aggregating functions of an entrepreneurial business network, this paper attempts to explore the antecedents enabling the organisation of diverse entrepreneurs to engage in a collaborative inter-firm business network project. This paper also elucidates the development of the relational capabilities and performance of entrepreneurial business networks.Design/methodology/approachAn explorative, longitudinal case study design is employed to analyse an Italian agricultural business network, which comprised a group of local small- and medium-sized enterprises (SMEs). Using the network as the focus of analysis, the case study draws insights from key informants comprising the network management team and the entrepreneurs who make up the membership of the business network.FindingsThe results of the study provide critical factors for successful organisation of inter-firm engagement. Although these factors are not mutually exclusive, the results show that organising for inter-firm engagement in an entrepreneurial business network context positively influenced the network relational performance and entrepreneurs' innovation capabilities.Originality/valueThe paper extends current understanding of inter-organisational engagement and illuminates the antecedents enabling the development of network relational dynamics capabilities. The empirical results provide unusual insights into the aggregating roles of an entrepreneurial business network, giving practitioners practical insights into managing a successful inter-organisational collaborative project. Using the relevant theoretical frameworks, the study empirically tests the organisation solutions relevant to literature on inter-firm engagement in a business network context and addresses the organisation solutions' interrelationship and linkages to entrepreneurial network relational performance in terms of knowledge practice, information and resources sharing and innovation.

The role of spirituality in Islamic business networks: The case of internationalizing Turkish SMEs

This paper sets out to investigate the role of religion and spirituality in a business network context, with an empirical focus on the international business development of Turkish SMEs. By drawing on the concept of homophily and tie strength, we argue that, while religion can act as a bridge and thus create a multitude of weak ties within a business network, spirituality can deepen these ties and make them stronger through increased emotional intensity, intimacy and reciprocal service. The data were collected from participants in two Islamic business associations in Turkey. The results suggest that spirituality indeed drives members’ commitment to the network and the presence of spirituality has a distinctive effect on members’ contributions to and demands on the network. More specifically, members who treat their network membership as an extension of their spiritual practice tend to mainly benefit from intangible resources, while members who view their shared religion as an entry point into the network seem to benefit from both tangible and intangible network resources. The findings have several theoretical and practical implications, including the introduction of the spirituality concept into the discussion of homophily and tie strength in business networks, and the role of home networks in the internationalization of SMEs.

Power and environmental reporting-practice in business networks

Purpose The purpose of this paper is twofold: first, the use of power in a business network context is investigated, in relation to companies’ environmental reporting and practice choices. Second, the environmental reporting-practice portrayal gap is examined, focussing on inter-organisational environmental practices (such as green supply chain management). Design/methodology/approach A network case study was undertaken in the Western Australian agrifood sector, with the two large, dominant supermarkets as focal actors. Data were drawn from 34 in-depth interviews from 2011 to 2013 and a document review including 15 years of supermarket reports. Findings The study showed the exercise of government power bases and its effect on supermarket and other supply chain actors’ reporting and practice choices. The data suggest a differential use of power by supermarkets with suppliers, depending on supplier type and environmental practice characteristics. The study revealed surprisingly transparent reporting of the lack of whole-of-supply-chain approach by the supermarkets and admission of shareholder power over reporting and practice choices. In addition, other reporting-practice portrayal gaps relating to inter-organisational environmental practices were found. Originality/value The study provides a unique network level analysis of how power relations interact and influence companies’ choices of environmental reporting and practice, thereby contributing to prior power and environmental reporting literature. Contributions are made to extant literature dealing with the reporting-practice portrayal gap by focussing on inter-organisational environmental reporting and practice.

A model of buyer-supplier relationships in a transnational company: the role of the business network context

The paradigmatic shift in marketing from the beginning of the 1990’s has transformed marketing in its view of business exchange to increasingly start addressing the relational aspects of market exchanges. This is particularly true in transnational supply exchanges, where specialization and outsourcing have increased the importance of effective and efficient management of buyer-supplier relationships, and their corresponding networks in which they are embedded in. In this regard particularly, TNCs are seen “as a [key] method of organizing international exchange” . The purpose of this paper is to analyze selected elements of buyer-supplier relationships within a specific TNC business-to-business (B2B) setting, vis-a-vis their impact on business performance and TNC competitiveness. This is done through the perspective of the TNC’s suppliers. The paper analyzes the impact of the functional aspect of the business network context on selected elements of buyer-supplier relationships, and their impact on business performance and the overall competitiveness. This is analyzed within a confirmatory testing of a reflective structural equation model . A unique feature of the model is its focus on the business network context - namely information obtained from the network and network spillover effects – as key network-embedded determinants of the “traditional” elements of buyer-supplier relationships (i.e. transaction-specific investments , trust , flexibility , and collaboration ), where these elements have been so far mostly studied at the dyadic level in buyer-supplier relationships. The dataset includes a sample of 157 suppliers of the focal TNC world-wide (47.9 response rate on a web-based survey).

The complexity of the business network context and its effect on subsidiary relational (over-) embeddedness

Many studies have focused on the effects of MNC subsidiaries’ external relational embeddedness. Little attention has been given to its antecedents and especially to the potential effect that the business network context might have. We try to fill this gap and attempt to explain variation among subsidiaries’ degree of relational embeddedness. Our results show a strong and robust effect of the business network context – i.e. the network context in which the direct business relationships between the subsidiary and its partners are embedded – on the degree of relational embeddedness. However, contrary to previous literature, we find an inverted u-shaped relationship. We discuss our findings with regard to the issue of over-embeddedness and the literature on the strength of weak vs. strong ties.

The Complexity of the Business Network Context and Its Effect on Subsidiary Relational (Over-)Embeddedness

Many studies have focused on the effects of MNC subsidiaries’ external relational embeddedness. Little attention has been given to its antecedents and especially to the potential effect that the business network context might have. We try to fill this gap and attempt to explain variation among subsidiaries’ degree of relational embeddedness. Our results show a strong and robust effect of the business network context -- i.e. the network context in which the direct business relationships between the subsidiary and its partners are embedded -- on the degree of relational embeddedness. However, contrary to previous literature, we find an inverted u-shaped relationship. We discuss our findings with regard to the issue of over-embeddedness and the literature on the strength of weak versus strong ties.

Editorial

Editorial

Customer portfolio planning in a business network context

In an increasingly globalised business environment, it is no longer adequate to analyse and develop supplier-customer relationship portfolios without consideration of a firm's network relationships. While research in business relationships has examined resource allocation and strategy development in the context of a dyadic relationship, portfolios and network relationships, little is known about the network effects of a focal firm's relationships on its performance particularly from both supplier and customer evaluations. The present study attempts to fill this gap by developing a customer portfolio framework that includes four levels of business relationships, and integrates a resource-based view and industry determinants of competitive advantage. The proposed framework is applied and analysed using data of UK-based food service companies. The main results show that a focal relationship performance is influenced by both industry and resource-based advantages in a business network context. The results also suggest that a focal firm can better enhance its competitive position with the knowledge of network effects and interdependence of strategic actions in a business network context.

Differentiation and Tourism Destination Development: Small Business Success in a Close-Knit Community

This paper considers small tourism business relations within a rural tourism destination. They are examined within the context of small business (predominantly hospitality-based) networks and their contribution to destination development. A cultural understanding of relations is presented through a qualitative research framework. Findings highlight the concept of differentiation at individual, business community and destinations levels. This ideal is discussed as a means for maintaining harmony within the business and wider social community through social network norms, which are reinforced at all levels of society.

The Effects of Learning on Relationship Value in a Business Network Context

ABSTRACT In today's intense global competition, a firm's ability to learn from its networks of business relationships is an important source of sustainable competitive advantage. Learning in a network of relationships involves a constellation of resource linkages among business partners tied together by interconnected resources. This has the potential of increasing the relationship value of a firm in terms of knowledge created through interactions among firms in the business network. Prior research has not yet examined the effects of learning in and through relationships in a business network context. Interdependence of firms in business networks gives rise to learning effects of adaptation and coordination that can have implications for relationship value. An empirical study of 215 business relationships from a network of nine high-technology companies in the United Kingdom shows that learning in and through relationships as a result of interactions and resource interdependencies in networks of relationships has a positive effect on a firm's relationship value. Furthermore, an understanding of the network context through interactions among firms facilitates learning and development of the firm's learning capabilities that enhance relationship value.

An empirical analysis of the influence of cross‐relational impacts of strategy analysis on relationship performance in a business network context

A review of the literature highlights that strategy analysis of business relationships based on the industrial organization perspective does not fully account for network characteristics. The present study proposes a model to integrate the industrial organization perspective with the resource‐based view, and to account for cross‐relational impacts of strategy analysis on relationship performance in a business network context. A total of 358 business relationships from UK‐based food service sector companies were examined on four levels of relationship: focal, portfolio, industry and network relationships. The results indicate the presence of cross‐relational impacts of industry and network relationship effects on focal relationship performance. Whilst the results show the industrial organization perspective accounts for relationship performance mostly at the focal and portfolio level relationships, the resource‐based view shows a strong positive relationship of industry and network based resources with relationship performance. The results suggest that strategic action occurring between a dyadic or focal relationship and in networks of relationships have wider implications for relationship performance.

Conceptualization of Strategy in Business Networks

This conceptual article explores the ways in which strategy is being conceived in business networks. The dominant industrial organization-based approach to strategy development has been noted to be inadequate in networks where strategies are characterized by joint action and interdependencies between firms. While the Europe-based network approach offers insights into network competition, it presents a rather broad concept that includes almost any kind of strategic action. The main obstacles are associated with the conceptualization of network context as borderless entities, and the absence of a dynamic integration between causal mechanism of business relationships and network context. It is suggested that an analysis of the concept of learning with respect to four levels of network context: industries as networks, firms in network, relationship portfolios and exchange relationships could provide a fruitful theoretical explanation for strategy in networks.

Mutual commitment and experiential knowledge in mature international business relationship

This paper examines how market knowledge and market commitment are developed in mature supplier/customer relationships in international markets. It reports the empirical testing of a model of increasing commitment and experiential knowledge development in international business relationships. The assumption is that the connected relationships in a business network are the basis for forming a relationship and it will influence how the focal relationship develops. The model shows the process when a supplier increases his or her knowledge of the business network that a foreign customer is embedded in and what happens as their relationship with the customer becomes mature, stable and profitable. In this situation the firm does not invest as much as it did early on in the relationship but diverts its attention to firms that are more embedded in the local business network context. The model thus explicates a process of transition as a firm moves from one mature relationship to create new relationships as it increases its foreign market involvement.

Creating value through mutual commitment to business network relationships

A structural model of business relationship development in a business network context is formulated and tested on data from the European International Marketing and Purchasing (IMP) project. The empirical analysis demonstrates a causal chain from business network connection through mutual commitment and mutual dependence to value creation in the relationship. The results show that mutuality in business network relationships is critical in developing interfirm systems of workflow interdependence that promote the creation of value. This also implies that, through their interaction in business network relationships, firms in business markets organize and share an unbounded structure of interdependent activities, enabling them to achieve greater value than would be the case if they did not engage in relationship development. Copyright © 1999 John Wiley & Sons, Ltd.

Dyadic Business Relationships within a Business Network Context

In business-to-business settings, dyadic relationships between firms are of paramount interest. Recent developments in business practice strongly suggest that to understand these business relationships, greater attention must be directed to the embedded context within which dyadic business relationships take place. The authors provide a means for understanding the connectedness of these relationships. They then conduct a substantive validity assessment to furnish some empirical support that the constructs they propose are sufficiently well delineated and to generate some suggested measures for them. They conclude with a prospectus for research on business relationships within business networks.

Dyadic Business Relationships within a Business Network Context

In business-to-business settings, dyadic relationships between firms are of paramount interest. Recent developments in business practice strongly suggest that to understand these business relationships, greater attention must be directed to the embedded context within which dyadic business relationships take place. The authors provide a means for understanding the connectedness of these relationships. They then conduct a substantive validity assessment to furnish some empirical support that the constructs they propose are sufficiently well delineated and to generate some suggested measures for them. They conclude with a prospectus for research on business relationships within business networks.