Effects of social capital on processes in a regional strategic network

Understanding the role of social capital is vital for implementing cluster policies as regional strategic networks and cluster initiatives are influenced by the local socio-economic context and its social capital. Social capital can create value for companies by closure of the network structure (bonding), which maintains internal mutual trust but bonding can also over-embed companies in their social context, whereas sparse networks that provide links to other parts of relevant business networks (bridging) often provide greater innovation benefits. We provide a conceptual framework applied to a case study of a Swedish regional strategic network, and examples mostly of positive effects of bridging social capital and negative effects of the bonding form are identified. This is interpreted against the background of the regional dependence-oriented culture.     

Inter-organizational meets inter-personal: An exploratory study of social capital processes in relationships between Northern European and ethnic Chinese firms

This paper deals with social capital in a business network setting focusing on three aspects of social capital: social interaction, social bonds and trust. The paper argues that because of variations in underlying principles and inter-organizational business practices between different countries and culture, social capital processes will take different forms and place different levels of importance on relationships in different countries. The paper investigates how northern European managers perceive social interaction, social bonds and trust in conducting business with ethnic Chinese business partners. The explorative study builds on interviews with 28 Finnish and Swedish managers in Singapore, Malaysia and Thailand. The findings of the study indicate that when northern European and ethnic Chinese firms develop trading relationships, the resulting relationship is neither Nordic nor Chinese. Both parties deviate from their native behaviour and a new type of relationship evolves as the exchange partners interact.     

Transaction Cost, Social Capital and Firms' Synergy Creation in Chinese Business Networks: An Integrative Approach

Overseas Chinese business networks have been a powerful growth engine propelling local economies in Southeast Asia and the Greater China region. However, relatively little research has been conducted on the relationship between social capital and a firm's synergy creation in overseas Chinese business networks. To narrow this knowledge gap, this study adopts an integrative approach drawing on two complementary theories of transaction cost economics (TCE) and social capital to investigate how a firm creates synergy in overseas Chinese business networks. A multiple regression method was used to test hypotheses. The results indicate that repeat transactions and close ties with government offices and financial institutions contributed positively towards a firm's synergy creation while other variables such as trust, transaction uncertainty and information sharing did not show any significant relationship with synergy creation. Data from 108 Hong Kong-based Chinese manufacturing firms provide evidence that the integrative approach is rather effective in studying a firm's synergy creation in the context of interorganisational relationships.     

Social capital in the growth of science-and-technology-based SMEs

There is increasing evidence of the positive role social capital plays in accessing resources and capabilities from and with other actors, and in establishing and maintaining business relationships. Yet, surprisingly little is known about how an organization's social capital and its utilization evolve over time. Focusing on this gap, this paper explores the role of social capital and its structural, relational and cognitive dimensions in the growth of science-and-technology-based SMEs. On the basis of our studies on social capital, entrepreneurial networks and SME growth, we develop a conceptual framework to describe their development through four overlapping phases, each of which involves different managerial tasks: innovation assessment, offering development, commercialization and rapid growth. The results of our longitudinal multiple case studies show that; (i) different types of networks and relationships are important in the transitional periods between the growth phases; and (ii) the role of social capital and its different dimensions varies in developing, maintaining and utilizing these partnerships and network relationships. These findings offer several managerial implications.     

Relationship-specific investments,social capital,and performance: The case of Korean exporter/foreign buyer relations

Relationship-specific investments are addressed as crucial factors for the successful management of the exporter–foreign buyer relationships. It is hypothesized that relationship-specific investments have a positive impact on social capital components such as trust and commitment, which in turn contribute to the relationship and business performance satisfaction between partners. On the basis of our analysis of the relationships between Korean exporters and their foreign buyers, the validity of the roles of relationship-specific investments and social capital are clearly demonstrated. The results provide us with a meaningful implication to the successful management of inter-firm relationships.     

Different recipes for success in business relationships

Companies need to manage business relationships successfully in order to stay competitive. Drawing on configurational logic, this study shows that companies can improve their relationship performance through leveraging the structure of their business relationships. However, relationship structures must align with the company's business strategy. To date, research has focused on individual characteristics of business relationships, but little is known about relational configurations, namely the interplay between different business relationship characteristics on the one hand, and the firm's underlying business strategy on the other. We apply Hoffmann's (2007) strategy typology, namely shaping, adapting, and stabilization strategy types, to operationalize different business strategies. Drawing on a sample of 658 business service companies and employing fuzzy set qualitative comparative analysis (fsQCA), this study confirms the existence of different recipes for success, that is, multiple equifinal configurations leading to relationship performance. For each of the three business strategies, different combinations of relationship characteristics are successful, each encompassing a distinct configuration of core and periphery conditions. While firms following an adapting strategy should stress behavioral commitment above all other relationship characteristics, the two remaining business strategies instead rely predominantly on different factors such as trust and communication. This study contributes to business marketing theory and practice by highlighting different ways to develop business relationships successfully.     

企业创新、价值链扩张与制造业盈利能力——以中国医药制造企业为例

本文分析了企业创新与价值链扩张之间的互动关系对企业盈利的影响。利用1998—2010年中国医药类上市公司和相关调研数据,实证研究了中国医药制造企业的整体盈利能力及其沿价值链不同方向扩张对盈利能力的影响,并具体分析了价值链上各环节的主要因素对企业盈利能力的影响程度。研究结果表明,纯制造类医药企业净资产收益率和销售净利率的下降幅度远远大于纯制造—扩张类医药企业,医药制造企业通过创新实施价值链上的业务扩张可以改善其盈利能力;中国医药制造企业盈利能力与价值链扩张之间存在着非线性关系,沿价值链向研发环节与营销环节的扩张都能有效提高、改善企业的盈利能力。     

The Importance of Social Capital to the Management of Multinational Enterprises: Relational Networks Among Asian and Western Firms

Social capital is an important concept for multinational firms. Firms operating in global markets rarely have adequate resources to compete effectively in global markets; they access the needed resources through formal and informal relationships with other firms. The cultures in Asian countries have emphasized relationships much more strongly than Western firms. Thus, relational capital, based on guanxi (China), kankei (Japan) and inmak (Korea), provides the framework for business dealings in many Asian countries. As a result, the social capital of many Asian firms gives them a potential competitive advantage in global markets. Western firms must develop social capital and learn to manage relational networks to gain and sustain a competitive advantage in global markets. Western firms can learn how to develop and manage social capital from Asian firms. Alternatively, social capital has some disadvantages. Firms are limited by their networks and thus experience opportunity costs and path dependence. Additionally, while Asian firms often have strong network ties in their domestic markets, they have to develop many more ties globally to operate effectively in global markets. As a result, the development and management of social capital has become of critical importance for competitive advantage in global markets.     

Industrial internet of things business models in the machine-to-machine context

This study analyzes Industrial Internet of Things (IIoT) business models in the machine-to-machine (M2M) context. Thereby, it develops a conceptual framework to categorize different types of business model innovation for companies operating in the M2M business space. Business model innovations tend to cross multiple industries and drive ecosystems in which smart objects facilitate business models and service applications that are incrementally or radically novel in terms of their modularity or architecture. Our framework identifies four distinct types of IIoT business models: (I) Company-specific business models, (II) Systemic business models, (III) Value designs, and (IV) Systemic value designs. Moreover, it sheds light on different abstraction levels of business model building blocks and exposes the characteristics and differences in the value potential between the four business models. Finally, we advance the idea of ‘value design’ referring to business models of multiple actors coupled together, ultimately resulting in complex networks and ecosystems of diverse things, processes, and companies.     

关系契约与企业网络转型

关系契约是企业网络形成和运行的微观基础，它有两条形成途径：一是由专用性资产而形成的双方依赖．二是动用个体社会资本而锁定双方的关系。相应地，企业网络可分为契约型和关系型两大类。关系型企业网络是中国转型经济的特征，家族企业及其网络的发展和寻租性企业网络的大量出现是转型期的必然现象。关系型企业网络产生的根本原因是中国独特的家族文化。经济转型要求企业网络从关系型向契约型转变，实质就是从关系治理向契约治理的转变。为此，必须从产权和日常管理方面加强对家族企业和国有仓、止的管理。尤其要着力培育宏观社会资本．     

Performance impact of middle managers' adaptive strategy implementation: The role of social capital

This article reconciles mixed findings about the performance impact of middle managers' strategy involvement. We propose that the relationship between middle managers' adaptive strategy implementation—through upward and downward influence—and objective business performance can be curvilinear and contingent on formal and informal structures. Applying a multilevel perspective to social networks, we empirically show that reputational social capital enhances the performance impact of middle managers' upward influence while informational social capital elevates the performance impact of their downward influence. The size of a business unit or region has differential moderating effects. The curvilinear effects of middle managers' upward influence and reputational and informational social capital on business unit performance reflect paradoxes. We discuss the implications of these findings for strategy implementation research and practice. Copyright © 2013 John Wiley & Sons, Ltd.     

The impact of network configurations on value constellations in business markets — The case of an innovation network

A growing body of scholars are advocating a better understanding of how value is created in business networks, rather than merely in business relationships or at the level of single actors. Among such networks, innovation networks, i.e. the configurations of strategic entrepreneurial nets aimed at improving the effectiveness of innovation performance, have come under scrutiny in the business marketing literature. However, research that explicitly connects value considerations with innovation network configurations is still in its infancy, with empirical evidence being notably scarce. This study is aimed at identifying if and how network configurations affect value constellation aspects in business networks, in terms of value recipients and value outcomes. We interviewed key informants representing 46 high-technology entrepreneurial firms co-located in an innovation network (Daresbury Science and Technology Park — UK). Our study identifies that different network configurations can co-exist in the same overall network; these, nevertheless, are not alternative independent structures, but rather they interact with each other through actors spanning their boundaries. Our study thus provides an understanding of network configurations relating to specific value consequences, but also provides evidence relating to the interactions between different configurations. By doing this, we establish a bridge between a business marketing and a strategy perspective on value in networks. Important managerial implications and implications for policy makers also emerge from our study.     

Innovation in business networks: The role of leveraging resources

This study investigates how companies innovate in their business networks. We examine the role of leveraging resources in the context of retail brand paints within the do-it-yourself (DIY) paint industry, where the role of innovation is pertinent to achieve differentiation and create value. The study investigates innovation as a process of leveraging resources within business relationships. Research findings demonstrate that manufacturers and retailers jointly leverage resources to develop and launch innovative retail brands. Companies need to carefully address these resource-leveraging processes and assess their options in developing innovations that enable sustainable growth.     

Institutions and business networks: A comparative analysis of the Chinese, Russian, and West European markets

The paper analyses business networks originating from three markets: Chinese, Russian, and West European. So far, little attention has been given to the fact that business networks in particular markets may be dissimilar because of differences among institutions. The paper advances a model where institutions are assumed to influence five major characteristics of business; (1) the processual aspects of the network, (2) the structural aspects of the network, (3) the function of firms and relationships in the network, (4) the meaning of strategy and planning, and (5) social relationships in the context of inter-firm relationships. The analysis builds on three types of substances of institutions — cognitive, normative, and regulative, which in turn are specified according to different aspects. The cognitive substance of business networks is explored through the aspects of self, time, and causality. The normative substance is explored through the aspects of achieved versus ascribed status, inner versus outer direction, universalism versus particularism, and trust. The regulative substance is specified as an authority system and a sanction system. The analysis demonstrates that, as institutions differ in these three markets, the business among them also differs in terms of the five characteristics, and this variation calls for different strategies for firms operating in these markets.     

Use of social capital among Russian managers of a new generation

Dynamic changes in the Russian political economy during the 1990s led to a unique combination of low levels of social capital at the general (state) level and very high levels of social capital at the interpersonal level. This research uses the three dimensions of social capital as outlined by Nahapiet and Ghoshal [Nahapiet, J. and Ghoshal, S. (1998) Social capital, intellectual capital and the organizational advantage. Academy of Management Review, 23, 242-266.], to investigate the operation of business networks within Russia. Focusing on a generation of Russian business managers who had minimal exposure to the previous regime and who experienced western education/business practices, this study illustrates one snapshot of social capital in Russia in 2004. Results highlight how this generation of business managers operates and how they conduct their business networks. It is expected that there will be changes in Russian business networks, as formalized legal systems become stronger and the new generation of Russian managers, who have had little exposure to socialist systems and nomenklatura emerge.     

Risk management system in business relationships—Polish case studies

The article discusses the problem of risk management in business relationships. The authors' research (including a case study analysis of 5 different relations) enabled them to identify and characterize the risk management systems based on a combination of formal control and relational mechanisms. In the authors' research it has been assumed that relational risk has a negative influence on the cooperation results and therefore it should be a subject of management. The main objective is not to avoid taking risk in relationships, but to reduce it to the minimum possible level. Companies' cooperation, including partnerships with different entities and participation in business networks, is an immanent characteristic of contemporary business. Therefore managers should look for the most efficient methods of dealing with additional relational risk and opportunistic behavior of potential partners.In the paper the case study analysis of five relationships of companies operating on Polish market was presented. The main objective was to demonstrate the relation between the level of trust and the intensity of formal control (including contract and formal monitoring). The range of social control applied in analyzed relationships was also an important issue of consideration.The research presented in the paper indicated that companies located in Poland in order to reduce relational risk aimed at diversification of its partners or full integration. Managers often underlined their fear of being dependent on one particular partner. This phenomenon could comprehensively decrease the advantages of intensive and deepened inter-organizational cooperation in Poland. Furthermore, the research demonstrated the decisive role of relational mechanisms and limited significance of contract in business relationship risk management. However, relatively higher importance of contract was observed in unbalanced relations between partners representing diverse bargaining power. A positive relationship between application of relational tools and cooperation results was identified as well.The aim of the paper is to demonstrate the nature of the relationship risk management system and the role of particular mechanisms that enable to reduce risk and its negative influence on cooperation results.     

Tensions and ties in social media networks: Towards a model of understanding business relationship development and business performance enhancement through the use of LinkedIn

The era of social media networks has created significant opportunities for business relationship development yet there exists a paucity of research in this area. To address this, this paper identifies four key tensions within the current literature: relational versus transactional exchanges, emergent versus strategic social media network development, the pace of social media network formation versus the development of trust, and the notions of sharing and reciprocity versus competitive advantage. This study draws on the principles of netnography, incorporating data from 554 LinkedIn group interactions and 12 interviews with professionals in one global industry to provide insight into business relationship development stemming from one social media network. Significant contributions to theoretical and practical knowledge are made through the recognition of tensions in the literature, the application of the notion of Granovetter's ties to a contemporary context and the novel use of netnography. Furthermore, the resultant model conceptualises the use of social media networking in building networks and relationships which lead to new business and enhance business performance.     

创始股东控制权威与经理人职业操守——基于社会资本的“国美电器控制权争夺”研究

在家族型上市公司中,创始股东往往会利用控制权威剥夺中小股东的利益,从而造成公司价值的损减。这时,经理人是否会为了保持"公司价值最大化"的职业操守与创始股东争夺上市公司的控制权?本文基于社会资本分析视角,将创始股东控制权威视为对经理人的社会资本控制,将经理人保持职业操守赢得的收益归为从内外部社会关系网络中取得的社会资本支持。然后,根据上述两个概念构建了经理人决策模型,详细解读了国美电器治理实践中的"控制权冲突"事件。经研究得知:理性的经理人会综合权衡创始股东控制权威和保持职业操守对其社会资本的影响,并以此选择是否争夺创始股东的控制权。     

Perceptions of Change in Business Relationships and Networks

Our research deals with the role of actors in change in business relationships and networks. In this study, we explore how cognitive elaboration of experience of a relationship affects the relationship development. The link between behaviors and cognitive elaborations has been the object of recent research in marketing, but little attention has been given to the issue of cognition and behaviors when actors interact in business relationships. Given the role of relationships and their dynamics for the development of business networks, we believe that the issue deserves more attention. Also, compared to the interest in the space dimension of business networks, i.e., network pictures, perceptions of time have been under-investigated. We report findings from 84 bilateral interviews with managers involved as customers or suppliers in 21 relationships with ICT Security at two points in time. We collected their interpretations and reinterpretations of past developments, outcomes, and desired outcomes of the relationships in which they were involved. Our data suggest that the link between managers' cognitive elaborations and relationship dynamics is less direct than commonly assumed. We argue that evolution of a relationship cannot be explained by individual interpretations of the parties involved in the relationship; a preliminary finding is that actors' intentions appear more to shape the interpretations, rather than the contrary.     

Value added reseller or value at risk: The dark side of relationships with VARs

This paper examines the dark side of using reseller networks to provide after-sales services. A proposal made by previous research studies on the use of brand-reseller relationships for management of value to be delivered remotely through reseller networks was reviewed. Technical inability, with a focus on the sales of resellers of information technology (IT) and information technology-enabled services/products (ITES), was highlighted as one of the major challenges faced by brands. Unsuccessful delivery and failure of VARs to provide after-sales services puts brand performance at risk and, as a consequence, negatively influences perceptions of other resellers concerning the brand. Thus a VAR's inability to support customers can discourage resellers from offering the brand to their customers. This dark side of network interdependence negatively affects the shared brand-reseller goal of value co-creation. Applying data collected from 334 resellers of technology brands in India, this research focuses on the current periphery of international branding literature by focusing on the dark side of manufacturer brand-reseller relationships. From the relationship management perspective, we contribute to the recognition of value-at-risk as the dark side of the brand-reseller relationship. Based on empirical findings, we propose a business model that will enable manufacturer brands to control the brand value perceived by their resellers, by monitoring the actions of their VARs.