Inter-firm Networks Research Articles

A Practice Perspective on Technology-Mediated Network Relations: The Use of Internet-Based Self-Serve Technologies

Embedded relationships with customers have been key in generating repeat business and economic advantage, especially in business-to-business settings. Such relationships are typically maintained through interpersonal interactions between customers and their providers. Lately, however, firms have been seeking to make their service operations more scalable by offering customers access to Internet-based, self-serve technology. This raises questions about the implications of inserting self-serve technology into embedded relationships. Recent research on the role of information technology (IT) within interfirm network relations suggests that relationships and the use of IT are complementary. However, most of this research focuses on the organizational level and fails to consider the instantiation of these interfirm relations by the actions and interactions of individual actors (e.g., customers and salespeople) representing their respective firms. In this paper, we explore the implications of using IT within interfirm relations through an analysis of customers’ and sales representatives’ (reps) work activities and interpersonal relationships. We apply a practice perspective that highlights how macrolevel phenomena such as interfirm relations are created and recreated through the microlevel actions taken by firm members. This analysis reveals that managing the complementarity between relationships and IT in practice is fraught with considerable tension. This study of WebGA, a bricks-and-clicks dotcom, highlights how the use of the self-serve technology made it more difficult for sales reps to build and maintain embedded relationships with their customers. The use of IT altered the nature and quality of information shared by the participants, undermined the ability of sales reps to provide consulting services to customers, reduced the frequency of their interaction, and prompted sales reps to expend social capital to promote customers’ technology adoption. These changes produced intended and unintended shifts in the network relations enacted by WebGA and its customers, and raised serious challenges to the viability of WebGA’s business model.

Understanding inter-firm network: a theoretical review

In business strategy research, firms are typically studied and analysed as autonomous entities. Researchers make enormous effort in investigating how to assist businesses to strategically utilise their external industry resources, internal resources and capabilities to achieve competitive advantages. Beginning in the early 1990s, this trend is continually being updated by an increasing concern when studying firms that are embedded in organisational networks. Corresponding to this, there has been a significant accumulation of studies focusing on inter-firm relations and networks. However, rather than consolidating any conceptual framework, these studies contribute to a rather complicated and patchy situation marked by a diversity of concepts, theories, and research results. The study provides researchers and practitioners a taxonomic overview of key perspectives dealing with inter-firm networks. The paper primarily describes the inter-firm network from a variety of theoretical perspectives. Key arguments of different theoretical perspectives are presented and critiques from some schools of thought are discussed. It is anticipated that this study will broaden the current understanding of the network concept and raise a wider awareness of different perspectives in interpreting this strategic entity.

THE ECOLOGY OF INTERORGANIZATIONAL INFORMATION SHARING

Increasingly, companies use interorganizational information systems to support business process partnerships, such as automatic replenishment systems and other supply chain initiatives, invoicing and payments, and insurance claims processing. Inter-firm networking in turn can increase the visibility of information generated and used by business partners. These business partners may experience intended and unintended impacts from the changes in the partnering relationship, in effect altering the ecology of the organization. Yet IT researchers rarely study an organization’s ecology, focusing instead on impacts upon internal processes. Our goal in this paper is to propose a definition of interorganizational information ecology, to provide IT researchers with a lens through which interorganizational information sharing should be studied. We begin by reviewing principles of ecology from the natural and social sciences and then discuss the emergence of principles of organizational ecology and information ecology within the management literature. We then argue that advances in information technology have been a primary enabler for companies’ focus on interorganizational business processes and that field research on IT-enabled business partnerships must include the impacts upon each partner and the information shared among them. An example from health care demonstrates the usefulness of the concept, and we conclude with suggestions for field-based research on the ecology of interorganizational information sharing.

Technological Innovations and Geographic Proximity in Interfirm Networks

This paper explores how and to what extent geographic proximity matters in collaboration in technological innovations of small and medium-sized enterprises (SMEs) in Osaka Prefecture.Interfirm collaborations in technological innovations are identified using patent data for which sample SMEs co-applied with other firms or organizations. The author measures geographic distances between sample SMEs and their co-inventors and examines the relationships between the distances and their characteristics (e. g., firm size, industrial sector). The results are summarized as follows. First, 40% of sample patents had co-patentees located within Osaka Prefecture, while the share of patents with patentees in Osaka of total patents published by the Japan Patent Office was only 17%. It is thus reasonable to assume that geographic proximity between patentees matters to some extent. Second, smaller and younger firms showed a weak tendency to depend on technological collaborations with more geographically proximate partners, although this does not necessarily mean that the size of a firm determines the distance from its partner. Third, mean distances from co-inventor firms differed by industrial sector. Three groups were identified: intraregional networks among SMEs; intraregional networks between SMEs and large hub companies; and interregional networks between SMEs in Osaka and large companies outside Osaka. The result indicates that there are various types of networks in terms of spatial scale and firm size in Osaka prefecture and that their differences can be partially affected by characteristics of industrial sectors.

Structure of interfirm alliance networks: understanding the influence of industry characteristics

A clear understanding of where interfirm cooperation thrives, and where it does not, has theoretical and practical implications. In this paper, using a US economy-wide alliance dataset, I distinguish the conditions under which the phenomenon becomes prevalent. Just as there are industries that are traditionally R&D intensive (e.g. pharmaceuticals, computers and biotechnology), manufacturing intensive (e.g. paper, aluminium and chemical), and advertising intensive (pharmaceuticals, food and cigarettes), are there industries that are alliance-intensive? Can we distinguish those industries based on other characteristics that we already know? We ask such questions in this paper. Results show that, controlling for size, in both large and small industries in the USA, R&D intensity is the only major statistically significant predictor of formation of interfirm alliances. The comprehensiveness of the data provides extraordinary validity to the above and the related findings reported.

Структуры управления сетевыми сообществами малых предприятий и роль доверия: германо-российское сопоставление

The paper discloses the impact of trust on management structures of the inter-firm relations in the sector of small business in the country with the developed market relations (Germany) and transition economy (Russia). The authors put into focus the impact of the trust types on the management of the inter-firm network relations of the German and Russian small enterprises. The empirical basis of the study is the standard poll of 197 German and 400 Russian small enterprises as well as the materials of the in-depth interviews, conducted within the international project in 2001-2003.

Modelling firm innovation using panel probit estimators

Firm-level innovation is investigated using three probit panel estimators, which control for unobserved heterogeneity, and a standard probit estimator. Results indicate the standard probit model is misspecified and that inter-firm networks are important for innovation.

Where do small worlds come from?

Interfirm networks often take on characteristics consistent with the notion of a small world--they are locally clustered into dense sub-networks or cliques that are sparsely connected by a small number of ties that cut across the cliques, linking network members through a relatively small number of intermediaries. Are these characteristics an emergent property of interfirm networks that result from chance connections among firms, or more strategic partnering by firms to improve or protect their network positions? After outlining a behavioral account for this frequently observed network topology, we show that the evolving investment bank syndicate network in Canada exhibited small world properties from 1952 to 1990. We then identify the investment bank cliques comprising the network and the 'spanning' ties that cut across them, and test three distinct scenarios that may explain the formation of these ties, which are responsible for the small worldliness of the networkc (i) chance partnering of firms in different cliquess (ii) insurgent partnering by peripheral firms to destabilize the network and improve their network positionss and (iii) control partnering by core firms to maintain the network status quo and their positions within it. All three scenarios played a role in explaining the formation of clique-spanning tiess however, chance and insurgent partnering played a greater role in our empirical setting. Our analysis of how small world structures emerge and evolve over time offers new insight into the origins of a prevalent interfirm network topology, and a baseline for constructing future models of interfirm network evolution and dynamics. Copyright 2003, Oxford University Press.

The Cross-National Diversity of Corporate Governance: Dimensions and Determinants

In this article, we develop a theoretical model to identify and explain the diversity of corporate governance across advanced capitalist economies. Our sociological approach is inspired by actor-centered institutionalism in stressing the interplay of institutions and firm-level actors. This model bridges the gap between undersocialized agency theory approaches and oversocialized views of institutional theory. In particular, we examine: (1) how a country's property rights, financial system, and inter-firm networks will shape the role of capital; (2) how a country's representation rights, union organization, and skill formation will influence the role of labor; and (3) how a country's management ideology and career patterns will affect the role of management. In the discussion, we explore how different configurations of institutions support different sorts of interactions among capital, labor and management in corporate governance. We illustrate the different patterns of conflict and coalitions among stakeholders around three axes: class conflicts, insider-outsider conflicts, and accountability conflicts. This approach has strong implications for studying issues of internationalization and the potential convergence of corporate governance in light of the interdependencies, complementarities and tensions between institutions within various national settings.

New Product Development and Product Supply within a Network Setting: The Chilled Ready-meal Industry in the UK

This paper analyses inter-organizational networks that link together firms operating in the food processing and distribution industry in the UK. In doing so, the paper draws on insights recently developed by Mark Casson that treat inter-firm networks as an institutional response to the changing costs and opportunities of information management. Detailed analysis of product innovation and supply-chain management issues within the industry, exemplified by the growth of chilled ready-meals, leads to the identification of two distinct but complementary inter-firm networks: a network of control and a network of innovation. In each case, the study finds that the critical information is derived from the retailers' interface with consumers and thus that these information-based networks are effectively controlled by the leading supermarket chains. The study's conclusions are considered in relation to the recent findings of the UK Competition Commission following its investigation into grocery retailing in Britain.

Inter-Firm Networks and Entrepreneurial Behavior: A Structural Embeddedness Perspective

We develop a theory of the effects of inter-organizational networks on both radical and incremental forms of firm-level entrepreneurial behavior (EB). The central argument is that structural embeddedness, with its focus on the network as a whole, and its two consequences, relational and cognitive embeddedness, individually and collectively influence incremental and radical forms of EB. Relationships in our model are driven by reciprocal interactions between intra- and inter-organizational sensemaking. This reasoning leads us to a dynamic, co-evolutionary model of EB.

Inter-Firm Networks and Entrepreneurial Behavior: A Structural Embeddedness Perspective

We develop a theory of the effects of inter-organizational networks on both radical and incremental forms of firm-level entrepreneurial behavior (EB). The central argument is that structural embeddedness, with its focus on the network as a whole, and its two consequences, relational and cognitive embeddedness, individually and collectively influence incremental and radical forms of EB. Relationships in our model are driven by reciprocal interactions between intra- and inter-organizational sensemaking. This reasoning leads us to a dynamic, co-evolutionary model of EB.

Organizational Hiring Patterns, Interfirm Network Ties, and Interorganizational Imitation

This study introduces the principles of social contagion and institutional theory to human resource management by examining the top management team (TMT) hiring patterns of Fortune 500 firms. Results provide some initial but promising evidence that social environmental factors should be incorporated into human resource management theory. Specifically, results indicate that firms hired TMT members from sources with which they shared interfirm network ties and that TMT hiring patterns were shaped by mimetic isomorphism.

ORGANIZATIONAL HIRING PATTERNS, INTERFIRM NETWORK TIES, AND INTERORGANIZATIONAL IMITATION.

This study introduces the principles of social contagion and institutional theory to human resource management by examining the top management team (TMT) hiring patterns of Fortune 500 firms. Results provide some initial but promising evidence that social environmental factors should be incorporated into human resource management theory. Specifically, results indicate that firms hired TMT members from sources with which they shared interfirm network ties and that TMT hiring patterns were shaped by mimetic isomorphism.

Getting Off to a Good Start: The Effects of Upper Echelon Affiliations on Underwriter Prestige

The initial public offering (IPO) is one of the most critical events in the lifetime of a young firm. Prior research has shown that firms tend to have successful IPOs if they go public with the endorsement of a prestigious lead underwriter. This paper examines the antecedents to receiving endorsement by a prestigious underwriter and links this to the experience base of a firm's upper echelon. We theorize that the amount and type of upper echelon experience serve as important symbols of a young firm's legitimacy to critical outsiders. We introduce a typology of upper echelon experience that distinguishes between upper echelon upstream, horizontal, and downstream employment-based affiliations and suggest that these different types of upper echelon affiliations allay different types of endorser concerns regarding firm legitimacy, affecting the endorsement process. Further, we theorize that the relationships between upper echelon experience and investment bank prestige will be moderated by technological uncertainty. We test our assertions on a comprehensive sample of public and private biotechnology firms that were founded between 1961 and 1994 and that went public between 1979 and 1996. Analyses of the five-year career histories of the over 3,200 executives and directors that make up the upper echelons of these firms show that firms with upper echelons with affiliations with prominent downstream organizations (i.e., pharmaceutical and/or healthcare companies) and with prominent horizontal organizations (i.e., biotechnology companies) are more likely to attract the endorsement of a prestigious investment bank. We also find that the greater the range of upper echelon affiliations across the categories of upstream, horizontal, and downstream affiliations, the more prestigious the firm's lead underwriter. We also find that these latter results are moderated by technological uncertainty. The present research has implications for the study of organizational legitimacy, interorganizational endorsements, and entrepreneurship.

ASEAN–China Free Trade Area: Advantages, Challenges, and Implications for the Newer ASEAN Member Countries

China's accession to the World Trade Organization and the proposed ASEAN-China Free Trade Agreement will provide greater market access in resource- and agro-based products and some manufactured goods for the countries (Cambodia, Laos, Myanmar, and Vietnam). At the same time, there will be much greater competition from China in both ASEAN-4's home and third-country markets, especially in a wide range of labour- and technology-intensive manufactures. Special and differential (S&D) treatment and flexibility for the will be necessary to enable a more effective participation by the newer members in the proposed ASEAN-China FTA. In this connection, two proposals are made for enhancing domestic entrepreneurship and inter-firm networking, and for monitoring and benchmarking supply capabilities and competitiveness at the enterprise level within ASEAN and China. most important trip you may take in life is meeting people halfway Henry Boye Judge a tree from its fruit, and not from its leaves. Euripedes I. Introduction Globalization has provided a dynamic platform on which to sustain high and durable rates of economic growth, structural transformation, and social development for many developing countries. In particular, it has opened up unlimited opportunities for gainful co-operation and integration in trade, investment, and services among countries and communities, including China and most ASEAN members. In this context, the leaders of ASEAN and China decided in Singapore during November 2000 to explore measures to widen and deepen the process of mutual economic co-operation and integration. A year later in Brunei, they endorsed a proposal to set up an ASEAN-China Free Trade Area (FTA) within ten years, and negotiations on trade liberalization for products under the early harvest programme were then initiated. Subsequently, a Framework Agreement on Comprehensive Economic Co-operation (FACEC) between ASEAN and China was signed in Cambodia, in November 2002. The agreement provides for, among other things, the completion of negotiations on trade in goods by mid-2004. It also envisages the operation of a FTA between China and the six older member countries (or ASEAN-6) from 2010. FTA arrangements between China and the ASEAN-4 (Cambodia, Laos, Myanmar, and Vietnam) will be in force from 2015. The Framework Agreement is likely to become another milestone in the unfolding process of multi-faceted growth and integration in trade in goods and services and investment among the developing economies of East and Southeast Asia. Section II of this article discusses the current patterns of trade and investment relationships between China and the countries. Section III then considers the potential and opportunities on the demand side, including additional market access in China for resourcebased products and intra-industry activities, which can be expected from the proposed ASEAN-China FTA. Section IV examines the supply-side impact on the ASEAN-4, as a result of China's proven competitive strength, recent World Trade Organization (WTO) membership, and proposed free trade arrangements with ASEAN. Due emphasis is given to the additional competition to be managed by the ASEAN-4, in both home and third-country markets, particularly on a wide range of labour- and technology-intensive manufactures. The nature and justification for special and differential (S&D) treatment and flexibility for the low-income and least developed countries of ASEAN are dealt with in Section V, with special reference to the non-WTO members within the ASEAN-4, in the context of the proposed ASEAN-China FTA. The promotion of small and medium-sized enterprises' (SME) competitiveness and capacity-building are among the focal areas of economic co-operation within the Framework Agreement. In this context, Section VI contains two actionable proposals for capacity-building in entrepreneurship development and inter-firm networking within and across borders, and for monitoring and benchmarking enterprise capabilities and competitiveness in ASEAN and China. …

Upgrading, uneven development, and jobs in the North American apparel industry

AbstractIn this article we examine the developmental consequences of globalization at multiple scales, using a commodity chains framework to investigate the case of the North American apparel industry. In the first section we outline the apparel commodity chain and offer a brief typology of its lead firms. In the second section we discuss the concept of industrial upgrading and describe several main export roles in the global apparel industry. In the third section we focus on the regional dynamics resulting from the North American Free Trade Agreement (NAFTA). We contrast the Mexican experience with that of countries in the Caribbean Basin to show the impact of distinct trade policies on export‐oriented development. We argue that NAFTA is creating upgrading opportunities for some Mexican firms to move from the low value‐added export‐oriented assembly (or maquila) model to full‐package production. In the fourth section we explore the unevenness of upgrading dynamics through a comparison of two blue jeans manufacturing clusters in the United States and Mexico: El Paso and Torreon. Our conclusions about upgrading and uneven development in the North American apparel industry emphasize the importance of local, national and regional institutional contexts in shaping inter‐firm networks and their development impact.

Contesting the State: Discourses of the Asian Economic Crisis and Mediating Strategies of Electronics Firms in Singapore

In the last decade or so, human geographers have paid greater attention to the significance of discourses. We acknowledge the importance of discursive constructions and metaphorical representations of economic space, and extend the argument by examining the practices that may follow from such discourses. With use of empirical data from a firm-level survey and interviews with representatives of electronics firms in Singapore, we focus on contested interpretations of the Asian economic crisis at the firm level: how they might differ from state-driven discourses, and the extent to which state discourses (embodied in ministerial speeches and policy initiatives) were accepted, contested, and negotiated through firm-specific practices. The different counterdiscourses and responses of local and foreign firms are also compared. Results show that discourses at the national (state) scale were challenged and contested by firms within the same national space economy because of such material conditions as firm-specific circumstances, spatial extensiveness of their intrafirm and interfirm networks, and their access to various formal and informal information channels. The sampled firms offerered their own readings of the crisis that often contradicted the effectiveness and usefulness of certain policy responses orchestrated at the national scale. Their abilities to weather the crisis were also differentiated significantly between local and foreign firms. The study therefore highlights the importance of understanding the complex interrelationships between discourses and practices at different spatial scales and their capacity to produce (un)intended geographical outcomes.

Firm networks: external relationships as sources for the growth and competitiveness of entrepreneurial firms

Inter-firm networks, as an inter-organizational form, are increasingly perceived as a model for entrepreneurial firm growth. We study egocentric networks of high-growth entrepreneurial firms in the IT industry and explore how these firms grow through the use of external relations and become competitive. Based on case study research, we identify that firms are using relations for a variety of purposes and that every firm has an individual relational mix. This relational mix changes with the development of the firms. While the relative importance of social and reputational networks decrease with the firms' development, co-opetition networks increase over time. Knowledge and innovation networks are a function of reputation and management capacity while the development of marketing networks depends on the firm's culture and management style. Both weak ties and strong ties are important for the growth of the firm since they fulfil different functions. Firm growth is determined by path-dependent relational capability that eventually reaches its limits and leads to the reconfiguration of a rather stable network. Additionally, firm growth depends not only on the building of egocentric networks but also on the existence and development of healthy sociocentric networks.

Social Networks and Interorganizational Trust

Much attention is drawn to an argument that social networks may influence development and performance of transactions and cooperation among firms, as many interfirm networks such as network organizations and strategic alliances recently show higher performance in market competition. Many scholars in economics, organizational theory and sociology argue that interorganizational trust is one of the critical conditions that can socially constrain opportunism in interfirm relations. The embeddedness approach from the new economic sociology reveals that social networks among organizations may facilitate the development of interorganizational trust with special relational and structural conditions such as high reciprocity and distributions of reputation. The aim of this paper is to review how the embeddedness approach explains the mechanism in which the special properties of social networks facilitate the development and the decline of interorganizational trust, by using the common concepts from the social exchange theory in, and to show that special relational and structural properties of social networks may facilitate its development.The embeddedness approach focuses on the structural effects of social networks among organizations on interorganizational trust in relational and structural dimensions, which are also known as “relational” and “structural embeddedness.” First, if social networks among organizations exhibit strong cohesion, they also have high reciprocity which is likely to facilitate firms to make a long-term commitment to their cooperation and “relational trust.” Second, if social networks have high density or many third-party mediations, they enjoy a great distribution of reputation that may encourage firms to share similar expectations for other companies, thus developing a “system-level trust.” Therefore, the embeddedness approach can explain how social networks affect the governance of economic exchange among firms through the development and the decline of interorganizational trust.