Business group affiliation and SMEs’ international sales intensity and diversification: A multi-country study

This study examines the impact of business group (BG) affiliation on international sales intensity and diversification in small and medium-sized enterprises (SMEs) by using a multi-country sample of over 13,000 SMEs from 34 European countries. Drawing on the revised Uppsala internationalization model and network theory, this paper suggests that the effects of BG affiliation on international sales intensity and diversification depend on the geographical dispersion of the BG network ties, the size and the age of the firm, and the institutional support in the home country. Thus, we find that interfirm networks in the form of BGs are a double-edged sword that can have both favorable and unfavorable consequences for international sales, depending on the geographical dispersion of the BG’s ties. In addition, the results reveal that BG affiliation is more beneficial for smaller SMEs and SMEs in countries with lower institutional support that are more dependent on the network resources embedded within BG networks.     

What drives the export performance of small and medium-sized subcontracting firms? A study of Korean manufacturers

Building on the resource-based view and network theory, we propose and test a framework of export antecedents of subcontracting small and medium-sized enterprises (SMEs). Whereas the internationalization of firms has been extensively studied in general, little is known about what drives the exports of subcontracting SMEs which play a very important role in the manufacturing sectors of East Asian economies. These subcontracting firms operate under very different conditions from other companies, resulting in specific ways they leverage their resources, capabilities and customer networks. An analysis of survey data from 1733 subcontracting SMEs in three South Korean manufacturing industries reveals that the firms’ export orientation and export intensity are related not only to their technological resources and their executives’ managerial capabilities, but also to features of their subcontracting network ties. Our study suggests that due to the specific nature of their business, subcontracting firms’ internationalization antecedents need to be analyzed in the context of their business environment which is strongly shaped by their customer relationships.     

Outsidership,network positions and cooperation among internationalizing SMEs: An industry evolutionary perspective

Immigrant entrepreneurship, like other market entries, continues to be examined in most studies as an event, and not as a process of ongoing interactions and exchanges that would adequately address the influence on such a transition of collaborative engagements and of industry evolution in the host market. Adopting an industry evolutionary perspective, we examine the facilitating role played by cooperative strategies among immigrant-run SMEs. Using a small number of valued customer and competitor relationships, we draw from case studies to show how both immigrant and native run SMEs gain knowledge and resources through collaborative engagements to extend into new customer segments. These relationships enable them to mitigate their outsidership by adopting positions on the edges of networks that allow them to avoid competing directly against other internationalizing SMEs abroad or in their home markets. Using context to build an industry evolutionary perspective, we observe their entry into collaborative engagements with intermediaries in other business networks to build additional industry segments in the less understood maturing industry phase. This study shows how native-run Italian internationalizing SMEs accessed the resources of immigrant Chinese business networks and developed capabilities for mutual benefit.     

What drives the internationalization of Chinese SMEs? The joint effects of international entrepreneurship characteristics,network ties,and firm ownership

The paper first investigates how Chinese small-to-medium enterprises’ (SMEs) network ties at home moderate the relationships between different international entrepreneurship (IE) characteristics and the degree of internationalization of the firm. The paper further explores how the Chinese SMEs’ ownership arrangement might explain the boundary conditions of the proposed moderating effects of network ties on the relationship between IE characteristics and internationalization. Findings of our empirical study generally support the hypotheses derived from our theoretical framework. The paper offers new insights into the internationalization of Chinese SMEs by ascertaining the differential contingent value of business versus political ties in the relationship between IE characteristics and internationalization and explores the bounds of our findings in terms of the ownership arrangement unique to the Chinese context.     

The Potential and Challenge of the Network Realization Capability for SMEs in Ireland and Finland

In recognizing that the term ‘network’ can be interpreted in a multitude of ways and from a number of varying perspectives, the purpose of this article is to report the findings of a study designed to determine whether SME owner/manager see networks as an industrial relationship phenomenon. This gap, termed ‘realization capability’ refers to the SMEs’ ability to visualize the inter-organizational embedded systems that they are a part of that could enhance their marketing efforts. Bonds tie network members together and provide the context for relationships. Therefore, in measuring the level of SME realization capability the authors conceptualized the concept into social and structural bonds to ascertain the network perspective of the SME participants. To determine the level of realization of SME actors, a participatory action research method was employed in an Irish setting and compared to a control group in Finland. Findings suggest that from an Irish perspective, realization was low, highlighting that misconceptions existed amongst the SMEs regarding the nature and dynamics of networks whereby they were viewed as a predominantly personal contact structure. Conversely, the Finnish participants viewed networks as interconnected business relationships, continually operating in close collaboration with other stakeholders within their business. The findings are discussed in detail as they raise the barrier for many SMEs to participate in networks which by definition are proposed as cost effective solutions which can address many of the gaps to implementing marketing approaches by SMEs.     

Managing Network Resource and Organizational Capabilities to Create Competitive Advantage for SMEs in a Volatile Environment

By considering embedded opportunities and threats in today's dynamic business environment, this study proposes that small‐ and medium‐sized enterprises (SMEs) can exploit the ties of interfirm networks to access external resources and information, thus enhancing their organizational agility and absorptive capacity in a variable business environment and enabling superior organizational performance. This study enables SMEs to combine the external resources embedded in strategic networks with internal organizational capabilities including organizational agility and absorptive capacity to create an idiosyncratic competitive advantage in a chaotic business environment.     

How does entrepreneurs' social capital hinder new business development? A relational embeddedness perspective

While most studies argue that, relational embeddedness, one facet of social capital, facilitates the obtaining process of scarce resources, our study cautions that it may exert negative impacts. This study examines the underlying process about how shared cognition influences new business development. Results from a survey on entrepreneur social network in China demonstrate that strong ties bring decision-making constraints for entrepreneurs to bear, while trust helps to lessen such restriction. Additionally, shared cognition should not become a preferred standard for entrepreneurs in choosing their network members, because simply relying on the intermediate role of tie strength engenders dark sides. Implications for research as well as for practice are discussed.     

The Moderating Effect of Perceived Effectiveness of SMEs' Marketing Function on the Network Ties—Strategic Adaptiveness Relationship

This study examines the critical role of perceived effectiveness of the Marketing function (MF) in small and medium‐sized enterprises (SMEs) in leveraging entrepreneurial network ties to improve strategic adaptiveness (SA). The study tests whether a MF perceived as effective by SMEs’ managers/owners moderates the relationship between SMEs network ties and SA required for improved performance. Findings of a moderated regression analysis on a sample of 263 Croatian SMEs indicate that network ties contribute significantly to their SA, and that a MF perceived as effective only moderates the impact of customer and competitor ties on SMEs’ SA. Research and practical implications are discussed.     

Returnee entrepreneurs and firm performance in Chinese high-technology industries

Building on the knowledge-based view and network perspectives, this paper explores the relationships between knowledge, networks and firm performance. Using a unique, hand-collected dataset of 353 small and medium enterprises (SMEs) of returning entrepreneurs and 358 local entrepreneur-owned SMEs from Zhongguancun Science Park in China, we find that the SMEs of returning entrepreneurs perform better than those owned by local entrepreneurs due to their technological and commercial knowledge as well as their international entrepreneurial orientation. Our results show that international networks positively affect firm performance in high-tech industries. Our findings indicate that returnee entrepreneurs gain competitive advantages through utilising their intangible assets to exploit business opportunities and development in an emerging economy.     

Transformation of Islamic Work Ethic and Social Networks: The Role of Religious Social Embeddedness in Organizational Networks

The aim of this study is to explore the influence of religious beliefs on social or work-related ties of managers who are member of organizational networks representing two different ideologies (religious and secular) in Turkey. In this research, the emergence of secular and devout entrepreneurs is considered as a phenomenon, and special attention is paid to religious transformation and secularism in Turkey. Social network analysis method is used to define the nature of communication links among 80 chairmen who are the members of two conflicting and dominant groups in Turkish business system. The findings show that Protestant work ethic suggested by Weber with regard to Christianity have attained a similar place over the past decade in Islamic organizational networks. The concern of political power in religion leads to organizational networks being nourished by religious norms and creeds in many developing countries. Especially in societies like Turkey where the state is dominant in the business life, organizations and managers prefer to be included in religious networks to make close contacts with the state. Another significant finding is that efforts of the members of religious networks—in spite of their relatively closed characteristics—in terms of being at the center of a network and taking the brokerage role, are highly developed on the contrary to the literature.     

Network ties and export propensity of Vietnamese small and medium enterprises

This paper investigates the impacts of different network ties on export propensity of Vietnamese small and medium enterprises (SMEs) in the manufacturing sector. Using data from a survey of over 2,600 manufacturing SMEs in 2015, we found that social networks contribute positively to the export propensity of SMEs, while the size of business networks negatively associates with the likelihood of export. However, bank networks and political networks are not significant for the propensity to export of Vietnamese SMEs. We discuss the results in detail and offer recommendations for SME owners, managers and policy makers.     

Competing on the edge: Implications of network position for internationalizing small- and medium-sized enterprises

Three generic competitive strategies attributed to internationalizing SMEs of targeting niches, differentiating products and leveraging networks fail to adequately explain how SMEs win customers in other countries against both large and small competitors. This study distinguishes competitive strategy (how firms compete) from competitive advantage, and from competitive engagements where firms deploy their competitive advantages to win customers within business network relationships. By abductively reasoning from the competitive engagements entered into by the internationalizing SMEs from the Fleet Management Systems industry segment in New Zealand, we show that these firms often compete with foreign rivals by using their position on the edge of a business network to leverage information asymmetries across structural holes. We contribute by integrating this conception of internationalizing SME competitive strategy with the business network foundations of the Uppsala internationalization process model.     

供应链金融中网络连接对中小企业融资质量的影响研究

近年来,基于供应链网络开展的供应链金融成为中小企业解决融资难的有效途径。文章基于网络视角,构建了中小企业在供应链网络中的强连接与桥连接通过信息分享影响其融资质量的理论模型,通过对255个调研数据进行统计分析发现：中小企业在供应链网络中的强连接和桥连接均对其供应链融资质量具有正向影响;信息分享是中小企业供应链网络连接影响其融资质量的重要内在机制;环境竞争性对中小企业信息分享与其供应链融资质量之间的关系具有正向的调节作用。     

How Entrepreneurs' Knowledge and Network Ties Relate to the Number of Employees in New SMEs

Knowledge is central to entrepreneurship when explaining successful venturing. However, little is known about how a founder's knowledge and their network ties relate to the number of workers in early‐stage small and medium‐sized enterprises (SMEs). This study draws on the knowledge‐based view and social network theory to examine 174 new SME founders. Findings suggest a positive relationship between the comprehensiveness of an entrepreneur's knowledge set and the number of workers. In addition, the number of network ties positively moderates the relationship between the entrepreneur's knowledge set and the number of employees. Network tie knowledge heterogeneity was not significantly related to the number of employees in new SMEs.     

Going Beyond Customers – A Business Segmentation Approach Using Network Pictures to Identify Network Segments

Existing approaches to segmentation, in particular business segmentation, are often conceptualized and applied in a limiting way, providing a narrow interpretation of the surrounding business network. This could be attributed to a rather myopic view of the multiple complexities and indirect links inherent in networks of business exchange relationships. The task for companies developing innovative segmentation approaches is to simultaneously enhance the company’s understanding of downstream as well as upstream preferences and resources, while going beyond immediate interaction partners to include relevant indirect business partners. The challenge is therefore not to identify attractive customer segments, but attractive network segments. As such, the managerial challenge becomes one of creating a business network segmentation from the perspective of a focal company within this network, taking a far wider interpretation of the concept of segmentation. Using the concept of network pictures, we outline the different dimensions that are important within a business network segmentation, and exemplify their use through a case study of an entrepreneurial company. Our study contributes to the literature by providing a detailed example of a practical application of abstract concepts, in this case the translation of the network picture concept into a way to apply a business network segmentation to an entrepreneurial context.

Asymmetric roles of business ties and political ties in product innovation

This study investigates the asymmetric roles of business ties and political ties in innovation processes. The study posits that business ties strengthen organizational competence and enhance the environmental fit. In contrast, political ties increase the environmental fit but ossify organizational internal routines. The study uses an extensive survey on 766 Chinese firms across multiple sectors to test hypotheses. The empirical results provide strong supports for hypotheses by showing that: (1) business ties have a positive impact on product innovation, indicating that despite different types of business ties, they share common features in enhancing product innovation; (2) political ties have an inverted U-shaped relationship with product innovation, indicating that the positive effect of political ties on product innovation would diminish as the costs of political ties outweigh the benefits.     

Network Characteristics and Firm Performance: An Examination of the Relationships in the Context of a Cluster

The study examined the impact of spatial relationships on firm performance. It also assessed the impacts of network structural and relational characteristics on performance, as well as the moderating effects of these variables on the spatial relationship to performance linkages. The sample comprised 252 firms located in a mold industry cluster in the Zhejiang province of China. Both in‐cluster ties and extra‐cluster ties positively impacted performance. However, the effects of distant ties were more pronounced. Tie stability had a positive effect whereas tie quality had a negative effect on performance. Network centrality, tie strength, and tie stability strengthened the relationship between in‐cluster ties and performance. By contrast, all network tie characteristics weakened and changed the form of the relationship between extra‐cluster ties and performance. The findings suggest the need for cluster firms to consciously cultivate distant linkages in their network ties in order to neutralize the tendencies for lock‐in and to arrest entropic deterioration in their respective clusters.     

Social support abroad: How do self-initiated expatriates gain support through their social networks?

On arrival, expatriates need to establish new social ties in order to succeed in the host country. In this study, we are investigating the social networks of self-initiated expatriates, focusing on the process of how they source social support. Building on information seeking theory, we have created a model connecting specific characteristics of network members (host country knowledge, employment status and host country origin) with the frequency of contact and support they provide. The model was tested through multilevel mediation analysis on 165 expatriates and their 575 network members. We contribute to the existing knowledge on expatriate networks by a theoretically driven categorization of network members and a detailed empirical analysis on the level of a relationship/tie. Our results show that expatriates rely on different network members for different types of support. Practical implications include the use of mentors to facilitate expatriate access to higher status individuals who can offer important support.     

A complementary perspective on business ethics in South Korea: Civil religion,common misconceptions,and overlooked social structures

Following the recent call for advancement in knowledge about business ethics in East Asia, this study proposes a complementary perspective on business ethics in South Korea. We challenge the conventional view that South Korea is a strictly collectivist country, where group norms and low trust determine the norms and values of behavior. Using the concept of civil religion, we suggest that the center of the South Korean civil religion can be seen in the affective ties and networks pervading the economic, political, and social institutions, embedded in and guided by Confucian ideals. We argue that South Korea should be seen not as a collectivist low‐trust society, but rather as an affective‐relational society, in which the relational context determines whether collectivism or individualism prevails. Further, we assert that trust, the cohesive factor of affective ties and networks, has until now been inadequately captured by conventional surveys. Our proposed perspective contributes to a more holistic picture and a more firmly grounded understanding of business ethics in South Korea.