The economics of formal business networks

This paper analyzes the under-researched issue of formal business networks comprising voluntary groupings of entrepreneurs who share knowledge and experiences between themselves. Economic analysis is used to show how formal business networks which enable entrepreneurs to share good and bad practice can improve efficiency and social welfare. The paper also derives conditions for the existence and equilibrium size of formal business networks. Two principles of network design are proposed to promote their stability and to avoid their collapse.     

Political actions in business networks a Swedish case

In international business studies, as well as in political science, the influence of political rules on business firms is assumed to be homogeneous and unidirectional. However, if the relationship between the political and the business actors is seen as an interaction, a different conclusion will be reached. We would like to add more knowledge to international business studies by analysing the interaction between governmental bodies and business units using a network model. In this paper, we study a ‘political case’ — the Bofors-India case — and analyse how this affair influenced other Swedish companies and their way of doing business in India. The question addressed is how the interaction between some parts of the government and a company — the development of one business relationship — is interwoven with other relationships. One conclusion reached is that a political act toward one MNC will affect other companies, although not in the same way. The degree to which and the way in which the other companies will be influenced depends on where they are positioned within the networks in relation to the problematic relationship.     

Culture and business networks: International business negotiations with Arab managers

The Arab world is an important economic region due to its natural resources, geographic location and political influence. However, limited attention has been paid to researching and understanding the way business is conducted in this region. We address this gap by exploring the key socio-economic, cultural and political factors that influence the negotiation process between Arab and non-Arab managers. Semi-structured interviews were conducted with 30 Arab managers in Lebanon with experience in international business. The findings of the study show that: Arab negotiators place emphasis on building relationships and use referent power (wasta); the political uncertainty influences the bargaining power of the Arab negotiators and political volatility in the country influences the Arab managers’ use of time during negotiations.     

Cultural identities of Chinese business: networks of the shark-fin business in Hong Kong

From a global standard, shark-fin consumption certainly violates international norms on bio-diversity and endangers the existence of the shark species. Furthermore, the commercial shark-fin industry generates additional adverse environmental impacts. Nevertheless, shark-fin consumption has served an important role in the cultural aspect of Chinese ‘foodway’. More importantly, the business relations and networks behind this industry have never been comprehensively studied. In so doing, this paper employs first hand interviews with the traders and processors, as well as official statistics from the government of Hong Kong, to come up with one of the most comprehensive and in-depth pieces of research on the business relations and the cultural aspects of shark-fin business in Hong Kong. In addition, we will explore the theoretical as well as the cultural dimensions of shark-fin business in trying to question the meaning of Chinese business networks. One of the key findings of this piece of research is that the collective activities of shark-fin consumption, business relations and networks are embedded along the historically, socially and culturally constructed Chinese identity. The implication is that such orchestration between culture and business can have far-reaching consequences to other Chinese businesses.     

Reward strategy spillover effects on observer cooperation in business networks

Marketing Letters - Drawing on social comparison and equity theory, this study examines the influence of reward strategies a manufacturer in a focal dyad employs on the cooperative behaviors of...     

基于Groupon的中国网络团购运营模式及发展对策研究

中国的网络团购模仿美国Groupon团购模式发展迅速,随之而来也出现很多问题。本文通过对美国Groupon的运营模式和中国网络团购的运营模式比较分析,对目前中国网络团购中存在的主要问题进行分析,并且作出相应的对策研究     

Managing conflict to improve the effectiveness of retail networks

Retailers are becoming involved with networks consisting of multiple firms in order to more effectively perform business activities such as supply chain management. This research develops and tests a framework outlining the effects of conflict in networks and how conflict management can mitigate and exacerbate these effects. A study of 81 simulated networks finds that inter-personal and task conflict have a negative effect on network member satisfaction and desire to be a member of the network. The use of a collaborative conflict management style has a positive effect on satisfaction and desire for continuity, but the effects of accommodative and confrontational styles depend on the level of inter-personal and task conflict present in the network.     

Economic criteria versus ethical criteria toward resolving a basic dilemma in business

Today's headlines suggest that economic criteria alone is the basis for business decision-making. This paper argues that while profitability is a legitimate end of business, it must be moderated by ethical considerations. But can business be both successfuland ethical? Practical examples highlight individuals who chose profitability over ethical responsibility and those who chose and continue to choose both. The authors propose that there is an ethical person profile. Corporate managers can resolve the profits vs ethics dilemma by modeling ethical behavior.     

Justice versus fairness in the family business workplace: A socioemotional wealth approach

The organizational justice literature and the family business literature have developed independently, which limits our understanding of fairness and justice in the family business workplace. So far, the concepts of justice and fairness have been used interchangeably in the family business literature, as if objective measures that aim to increase justice in the workplace will automatically translate into fairness perceptions among family business employees. By integrating the organizational justice literature and the family business literature, we first differentiate between the two concepts of justice and fairness and argue that a utilitarian conceptualization of justice may come into direct conflict with fairness perceptions in the family business workplace. Second, we shed light on the importance of incorporating socioemotional goals, particularly those that reveal a bright side of socioemotional wealth, into rules and regulations designed to increase justice in the workplace, which, we argue, contributes to increasing fairness perceptions among employees and to building and maintaining an ethical family business workplace. Theoretical and practical contributions are discussed at the end of the paper.     

Experiential knowledge antecedents of the SME network node configuration in emerging market business networks

This paper aims to determine experiential knowledge antecedents of the network node configuration (i.e., dyad or triad) of SMEs entering emerging market business networks. Three kinds of knowledge of different degrees of specificity are assessed, namely, general internationalization, market-specific, and customer-specific knowledge. The sample consists of 203 SMEs in southern Sweden with experience of entering the Baltic State, Polish, Russian, or Chinese markets. The theoretical framework integrates network theory and internationalization process theory in order to understand and explain the internationalization of smaller firms. The hypotheses formulated are tested using logistic regression, which indicates that market- and customer-specific types of knowledge favor a dyadic network node configuration into the emerging market business network, while general internationalization knowledge has no significant effect. In addition, interaction effects were seen to moderate relationships between knowledge antecedents and the network node configuration of the sampled SMEs.     

The trade-creating effects of business and social networks: evidence from France

Using theory-grounded estimations of trade flow equations, this paper investigates the role that business and social networks play in shaping trade between French regions. The bilateral intensity of networks is quantified using the financial structure and location of French firms and bilateral stocks of migrants. Compared to a situation without networks, migrants are shown to double bilateral trade flows, while networks of firms multiply trade flows by as much as four in some specifications. Finally, taking network effects into account divides the estimation of the impact of transport costs and of the effect of administrative borders by around three.     

Assessing the employment effectiveness of small business financing schemes: Some evidence from Israel

This paper presents an empirical assessment of the employment effects of two assistance schemes aimed at improving the accessibility of small businesses to capital. The first scheme is a revolving loan fund operating in two small towns. The second is a capital grant scheme aimed at promoting industrial activity in rural areas. Empirical data relating to the period 1986–89 is analysed for both schemes.The employment effectiveness of the loan fund is analysed via the estimation of cost-per-job indices and the estimation of the deadweight effect, i.e., employment that would have been created even in the absence of the financing scheme. For the grant scheme, the methodology implemented involves the use of regression techniques in order to isolate the effect of the financial assistance on employment generation. The results point to the cost-effectiveness of this form of assistance. From a public policy point of view, the need for targeting these type of schemes (both spatially and sectorally), is stressed.     

New business models in online hotel distribution: emerging private sales versus leading IDS

This article deals with online hotel distribution. Its purpose is to investigate the private sales formula, which has recently emerged as a new business model. Two case studies are presented: Expedia, a leading internet distribution system (IDS), and Voyage Privé, a private sales Website. The study highlights the main features of the private sales formula by means of a cross-case comparison between the two travel Websites. The article ends with some final remarks on the main strengths and weaknesses of the formula as compared to the leading IDS in the online travel market.     

Teams developing business ideas: how member characteristics and conflict affect member-rated team effectiveness

Team researchers have found that the diversity to effectiveness ratings are mediated by team conflict. Using a sample of 73 teams developing their business ideas, I found direct effects of diversity and conflict on member-rated team effectiveness. Here, I explain how the circumstances under which these teams operate can lead to these findings. For these teams, task conflict was found to relate negatively to member-rated team effectiveness. This finding contrasts with research on organizational teams, where task conflict usually relates positively to team effectiveness ratings. I also found that both diversity and average member experience influence member-rated effectiveness. These findings imply that diversity, conflict, and ratings of team effectiveness may differ for teams developing business ideas as compared to organizational teams. Thus, findings from organizational team research should be applied with caution to teams developing business ideas and possibly to new venture teams in general.     

Product liability and safety: Perspectives from business versus public policy makers

Product liability and the improvement of product safety are major concerns confronting business executives and public policy makers. This article reports the results of a mail survey that explored some of the major issues surrounding product liability and safety. The survey solicited the opinions of manufacturing executives, insurance executives, and state insurance commissions. Analysis of the data involved comparison of the opinions of the three groups of respondents. In general, the respondents agreed that (1) the increased emphasis on safety has caused prices to rise, but products are safer; (2) the salesforce should be used more as a source of information on the safe use of products; (3) a good safety record is a competitive edge for a manufacturing firm; (4) small businesses should not be treated more leniently than large ones in product liability cases; and (5) the CPSC's activities have generally been favorable. In contrast, manufacturing and insurance executives were more negative regarding the application and enforcement of strict liability than were insurance commission respondents.     

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

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

As time goes by: Examining the paradox of stability and change in business networks

Stability and change may seem contradictory features but in business networks, they coexist [Hakansson H, Snehota, I. Developing Relationships in Business Networks. London, Routledge; 1995]. This article explores the paradox of the coexistence of stability and change in an Australian context. Previous research illustrated that stability over time can exist in specific business relationships [Sutton-Brady C, Donnan, M. Nexus nonsense or is it? Conference Proceedings, 19th Annual IMP Conference, Lugano, Switzerland September 2003; 2003]. This research study further investigates time as a proxy variable of stability [Halinen A, Tornroos, J-A. The meaning of time in the study of industrial buyer–seller relationships. In: Moller K, Wilson DT, editors. Business Marketing: An Interaction Approach. Norwell, Mass: Kluwer Academic Publishers; 1995.] and attempts to uncover other variables, which may influence the stability of the relationship. Given the exploratory nature of the research a case study approach was utilized to gain an in-depth understanding of the variables, which may contribute to the stability. This article further advances the concept of time as a proxy variable for stability while investigating what other variables may be crucial in understanding this concept. From analysis of the case studies, the findings show that other variables do play a role in determining the stability and change in the relationships and networks, these included location, product/service quality, technology, cooperativeness, adaptations and cost. The major contribution of this article is the reopening of discussions on time as a proxy variable for stability and attempts to broaden this to include other variables.