A relationship value perspective of social capital in networks of software SMEs

Utilizing theories on social capital, business networks, social networks and relationship value, we explore the aspects that provide specific value in relationships with different actors in the software industry. The motive for the study is the assumption that some relationships are regarded as more important than others, and companies strive to focus on fewer relationships with greater outcomes. The study is guided by the premise that social capital is a foundation for relationship value, and its identified elements differ among relationships. We take the perspective of software companies and classify their relationships with business partners into three distinctive types according to their function in the value creation process. The findings of our empirical analysis, based on a qualitative case study of eight software SMEs indicate that the aspects of social capital, like the sources of relationship value, vary systematically by the types of relationships. Thus, we are able to provide some theoretical and managerial implications on the management of small- and medium-sized 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．     

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.     

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.     

Managing in complex business networks

For many years, research and management thinking has focused on understanding business relationships and networks. Now, the focus is shifting to managing business relationships and networks. This new approach focus poses two questions. Since networks are loosely coupled systems, to what extent are business networks manageable? Furthermore, how can a firm's ability to manage a network be characterized and measured? This paper addresses these two questions by synthesizing the current state of knowledge on management issues in networks and the contribution to managerial abilities in complex relationships. The discussion leads to a set of propositions describing the abilities firms will need to successfully manage complex business networks.     

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.     

Rise of strategic nets — New modes of value creation

This paper focuses on the type and management of intentionally created business networks called nets. Nets are extensively being used to achieve a variety of benefits over those of a single firm or market transaction. We propose that the effective management of different types of business net is dependent on their underlying value creation logic. Based on this notion a value creation framework of three generic net types - ‘current business nets’, ‘business renewal nets’, and ‘emerging new business nets’ - is suggested. We argue that they pose widely different conditions and requirements for net management. The management mechanisms of these basic net types are then identified and discussed. We contend that the proposed contingency framework captures the complexity and variety of the expanding strategic business nets in a more valid way than the extant classifications of network organizations. The paper contributes to the emerging theory of network management.     

Types of synergy and economic value: The impact of acquisitions on merging and rival firms

Acquisitions, in general, have been demonstrated to create economic value. The intuitive reason underlying this value creation stems either from an ability to reduce costs of the combined entity, an ability to charge higher prices, or both. Current research in the area attributes these abilities to an opportunity to utilize a specialized resource. Our focus in this study is to compare three broad classes of resources that contribute to the creation of value. Following the conventional wisdom, these resources are classified as cost of capital related (resulting in financial synergy), cost of production related (resulting in operational synergy), and price related (resulting in collusive synergy). Given the limitations of our sample and research design, we find that collusive synergy is, on average, associated with the highest value. Further, the resources behind financial synergy tend to create more value than the resources behind operational synergy.     

Building social capital in networks

This paper explores the re-emerging concept of social capital in business networks. Spanning a multitude of disciplines and different contexts, the construct remains ill defined and its measurement imprecise, yet researchers in both the developed and transitional economies are increasingly finding it necessary to draw upon social capital as a means of explaining behavior within embedded social networks. We encourage and indeed implore researchers to continue to explore the construct and its impact on the performance of business networks.     

Social Capital and Union Revitalization: A Study of Worker Networks in the UK Audio‐Visual Industries

This article examines Jarley's contention that trade union revitalization is conditional upon the generation of social capital through the systematic creation of networks. It draws on a qualitative study of freelance workers in the UK audio‐visual industry to consider two propositions. The first, that ‘social capital within networks is forged on “bonds” that are conducive to trade union identity’ was not sustained by the data, which instead suggested that social capital is more likely to be generated by networks outside trade union structures. However, the data did support the second proposition that ‘trade unions can harness social capital in order to achieve concrete industrial relations outcomes’ by linking networks to reservoirs of expertise and influence.     

The network perspective and the internationalization of small and medium sized software firms from Syria

This study has employed a case-based approach to explore the relevance of relational factors in explaining the internationalization of six software B2B SMEs from Syria. It contributes by providing rare empirical insights on the internationalization behavior of Middle Eastern SMEs and redressing, albeit slightly, the apparent research gap in the internationalization of knowledge-based SMEs from developing countries. Analysis results suggest the importance of the relational perspective in explaining the initial internationalization, market selection and internationalization speed of the investigated software firms. It emerged that the case firms either reacted to the cross-border opportunities offered by their relational contacts or proactively pursued overseas opportunities through existing and newly developed relationships. Their market entry decisions and internationalization pace also appear to have been influenced by these relationships. Both social and business networks were found to be important, but social ties seemed more influential at initial stages, with business networks becoming more dominant subsequently. The article concludes with appropriate recommendations for managerial decision making and future research.     

Promoting innovation through the accumulation of intellectual capital, social capital, and entrepreneurial orientation

This study attempts to explore how a firm's operational mode can reinforce the advantages of intellectual capital on innovation. Specifically, the main purpose of this study is to develop a comprehensive research model to integrate the interrelationships among social capital, entrepreneurial orientation, intellectual capital, and innovation. In addition to identifying the influences of intellectual capital on innovation, this study focuses in particular on the mediating effect of intellectual capital and the moderating effects of social capital and entrepreneurial orientation on innovation, which have largely been neglected in previous literature. The results support the mediating role of intellectual capital and the moderating roles of entrepreneurial orientation and social capital on innovation. Specifically, firms that have higher levels of social capital and entrepreneurial orientation tend to amplify the effects of intellectual capital on innovation.     

Market-driving versus market-driven: Divergent roles of market orientation in business relationships

This study focuses on market orientation (MO) and customer intimacy (CI) in business-to-business marketing. These are generally regarded as key success factors in marketing. The authors argue, however, that the relationship between MO and customer relationship has not been properly examined, nor has its dependence on a firm's strategic market posture been understood. A contingency framework is proposed to test the postulated relationships between the key constructs. Our results indicate a strong positive association between MO and CI. Furthermore, this linkage is clearly influenced by the market focus and business logic adopted. In managerial terms, business executives must carefully match the strategic posture of the firm, its MO, and customer relationship management (CRM). Our findings strongly support a contingency modeling approach in studying the factors underlying marketing performance in business markets.     

内部资本市场、关联交易与公司价值研究——基于我国上市公司的实证分析

本文认为探究我国内部资本市场(ICM)有效性时应综合考虑关联交易(RPT)问题。因此文章在对内部资本市场和关联交易理论分析的基础上,着重探究内部资本市场中的关联交易对我国公司价值的影响。实证研究发现:总体上我国内部资本市场成员间的关联交易表现为促进公司价值提升,这种促进作用主要来自公允的内部资本市场关联交易,尤其表现为内部资本市场关联流入;我国内部资本市场配置低效的结论主要与非公允的关联交易相关;外部资本市场的金融抑制状态,使得国内企业通过内部资本市场中的关联交易实现降低交易成本和市场风险、放松融资约束、提升公司价值的目的。     

地方保护能提升公司绩效吗——来自上市公司的经验证据

本文以我国上市公司为研究样本,考察地方保护和要素市场分割对微观组织经济效率的影响。研究发现,地方保护虽提高了公司收入,但降低了要素资本(包括劳动力和原料)流动,导致微观组织经济效率降低。地方保护程度越严重,该地区企业劳动工资率越高,冗员越严重,企业主营成本越高,最终导致经济绩效越差。本文结论表明,从长远看,建立全国统一市场、打破地方保护主义和市场分割,无论对整个社会资源的优化配置,还是本地区企业的长远发展都具有重要意义。     

The impact of network relationships on internationalization process: An empirical study of Chinese private enterprises

Chinese private enterprises have been internationalizing rapidly during the last two decades. This study adopts a network approach to examine what factors affect the internationalization process of Chinese private enterprises. Our survey of 108 private Chinese enterprises in the manufacturing sector in Zhejiang province in southeastern China revealed that business networks and personal networks affect the internationalization activities of Chinese private enterprises. Specifically, business networks have a positive impact on the timing of the first foreign market entry, the internationalization pace, and resource commitments, whereas personal networks have a positive impact on the internationalization pace and resource commitments, but not on the timing of the first foreign market entry. In this paper, we report our findings of our survey, discuss the contribution that this study makes to the existing internationalization literature, and suggest future research directions. Policy implications on how to facilitate the internationalization process are also discussed.     

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.     

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.     

Value synergy and value asymmetry in relationship marketing programs

Prior research advocates a positive, linear association between relationship investments and relationship performance. Our study challenges this conventional wisdom and advances the extant literature by investigating the potential curvilinear effects of suppliers' different relationship marketing programs (i.e., social, financial, and structural) on dyadic perceptions of relationship value. From an analysis of 113 buyer-supplier dyads, we found that social programs enhance relationship value synergy, but their effect on relationship value asymmetry between suppliers and buyers follows a U-shaped curve. On the other hand, we observe a positive and increasing returns-to-scale effect of financial programs on relationship value synergy and its inverted U-shaped association with supplier's relationship value asymmetry. Interestingly, structural programs increase relationship value synergy and have a stronger effect on increasing relationship value for the supplier than for the buyer. In addition, we find that structural programs are more effective in creating value in long-term relationships than in short-term relationships; therefore, as the relationship with a buying firm ages, managers should consider investing more in structural programs to develop their relationship. However, in long-term relationships, managers should avoid investing too much in financial programs because financial programs are less effective in increasing creation of relationship value as a relationship ages.     

Multidimensional social capital as a boost or a bar to innovativeness

Innovation does not only demand new ideas, financial resources and knowledge of supplier and user systems, but is also influenced by social capital which has an impact on the innovativeness in business networks. However, social capital is often vague, at times described as a “catch-all notion”. In this paper definitions of social capital are suggested to support the management of innovation in networks. Three dimensions of social capital are applied in a case study of a regional strategic network – the socio-economic, the structural and the actor-oriented dimensions – while focusing on the last one. Data were collected at two points in time, at the start of the regional strategic network in 2004 and at the end of the project in 2010. The application of the concepts and the comparison between these two points in time highlight the influence of social capital and how it can hinder or be used to promote innovation processes.