What is a networked business?

Due to increasing competitive pressure in their market, many enterprises are implementing changes to the way they conduct business. These changes range from implementing new IT, to redesigning the structure of the organization and entering into all kinds of cooperations with other enterprises, forming what we call a ‘networked business’. In this paper, we try to explain the origin of the networked business from three different, but related, perspectives: resource dependence, transaction cost and IT impact. We also explore some terms that are used to describe interorganizational structures to find their principal components in an attempt to determine relationships between them and find a broad and precise, new definition of the term ‘networked business’

Towards technological rules for designing innovation networks: a dynamic capabilities view.

Inter-organizational innovation networks provide opportunities to exploit complementary resources that reside beyond the boundary of the firm. The shifting locus of innovation and value creation away from the “sole firm as innovator” poses important questions about the nature of these resources and the capabilities needed to leverage them for competitive advantage. The purpose of this paper is to describe research into producing design-oriented knowledge, for configuring inter-organizational networks as a means of accessing such resources for innovation

Boundaryless Management - Creating, transforming and using knowledge in inter-organizational collaboration. A literature review

Current literature on organizations often argues that firms are becoming increasingly dependent on knowledge residing outside their own boundaries requiring organizations to increase their entrepreneurial abilities and make their boundaries more flexible and permeable. This paper reviews the literature on what might be called interorganizational knowledge work. Implied in this focus is an assumption of clear organizaitonal boundaries. Rather than taking these boundaries and their importance for granted, the current review, however, aims at relativizing these boundaries. By focusing the empirical phenomenon of collaboration between individuals in different organizations, four different streams of literature with different constructions of the organizational boundary and its importance were identified: the literature on learning in alliances and joint ventures, the literature on collaboration in industrial networks, the literature on social networks and communities of practice and finally the literature on geographical clusters and innovation systems. The above four streams of the literature are reviewed with a special focus on the following three questions: 1. What is the role of (organizational) boundaries in interorganizational knowledge work? 2. What do we know about how these boundaries can be overcome? 3. What are the implications for managing interorganizational knowledge work spelled out in the literature?Interorganizational collaboration; Knowledge Management; Literature review

Assessing partnership alternatives in an IT network employing analytical methods

One of the main critical success factors for the companies is their ability to build and maintain an effective collaborative network. This is more critical in the IT industry where the development of sustainable competitive advantage requires an integration of various resources, platforms, and capabilities provided by various actors. Employing such a collaborative network will dramatically change the operations management and promote flexibility and agility. Despite its importance, there is a lack of an analytical tool on collaborative network building process. In this paper, we propose an optimization model employing AHP and multiobjective programming for collaborative network building process based on two interorganizational relationships’ theories, namely, (i) transaction cost theory and (ii) resource-based view, which are representative of short-term and long-term considerations. The five different methods were employed to solve the formulation and their performances were compared. The model is implemented in an IT company who was in process of developing a large-scale enterprise resource planning (ERP) system. The results show that the collaborative network formed through this selection process was more efficient in terms of cost, time, and development speed. The framework offers novel theoretical underpinning and analytical solutions and can be used as an effective tool in selecting network alternatives

Value Creation and Value Claiming in Make-Or-Buy Decisions

Transaction value analysis (TVA) integrates the concepts of resourceheterogeneity and transaction cost economics into a single framework,which emphasizes both value creation and value claiming in firms'vertical integration decisions. Using a TVA perspective, we develophypotheses to explain the firm's intent to outsource applicationservices. A sample of 178 firms in the publishing and printingindustry in The Netherlands is used to test the hypotheses. This paperfinds that firms take both value-creation and value-claimingmotivations into consideration, with value creation having on averagea dominating impact, thus substantiating the TVA framework. However,we also find that if the risks of opportunism in outsourcingcontracting are high, value creation becomes the less important factorin make-or-buy decisions. Furthermore, the paper shows that the needfor flexibility is a major driver of governance choice forvalue-creation as well as for value-claiming motivations. Implicationsand future research directions are discussed.information technology;interorganizational strategy;make-or-buy decisions;outsourcing relationships;transaction value analysis

Knowledge flow across inter-firm networks: the influence of network resources, spatial proximity, and firm size

The objective of this paper is to analyze the characteristics and nature of the networks firms utilize to access knowledge and facilitate innovation. The paper draws on the notion of network resources, distinguishing two types: social capital – consisting of the social relations and networks held by individuals; and network capital – consisting of the strategic and calculative relations and networks held by firms. The methodological approach consists of a quantitative analysis of data from a survey of firms operating in knowledge-intensive sectors of activity. The key findings include: social capital investment is more prevalent among firms frequently interacting with actors from within their own region; social capital investment is related to the size of firms; firm size plays a role in knowledge network patterns; and network dynamism is an important source of innovation. Overall, firms investing more in the development of their inter-firm and other external knowledge networks enjoy higher levels of innovation. It is suggested that an over-reliance on social capital forms of network resource investment may hinder the capability of firms to manage their knowledge networks. It is concluded that the link between a dynamic inter-firm network environment and innovation provides an alternative thesis to that advocating the advantage of network stability

Trust, Organizational Controls, Knowledge Acquisition from the Foreign Parents, and Performance in Vietnamese International Joint Ventures

Successful adaptation in strategic alliances "calls for a delicate balance between the twin virtues of reliability and flexibility" [Parkhe 1998]. On one hand, the joint venture must be flexible enough to respond to the uncertainties of competitive business environments because it is not feasible to plan for every possible contingency. Yet, on the other hand, unfettered flexibility invites dysfunctional behavior, such as opportunism and complacency. This delicate balance accompanies a parallel balance between trust and control of the joint venture. The primary goal of this study is to empirically examine this relationship in the context of Vietnamese international joint ventures (IJVs) by building on the model of knowledge acquisition and performance in IJVs established by Lyles and Salk [1996]. This study makes three major contributions to the literature. First it confirms several findings of the original Lyles and Salk study [1996]. Second, we strengthen Lyles and Salk's original model by incorporating multiple measures of both interorganizational trust and control as independent variables. Finally, this study represents one of the first in-depth examinations of business in the emerging Vietnamese economy.http://deepblue.lib.umich.edu/bitstream/2027.42/39713/3/wp329.pd

Transparency dilemmas, information technology and alliances in agriculture and food industry

alliance, agriculture, food industry

Required IT-Related Capabilities For The Utilization of New Opportunities in Creating Interorganizational Competitive Advantage

Developments in information technology (IT) are perceived to promote interorganizational cooperation within and across industry boundaries. IT-enabled cooperation has challenged the creation of interorganizational competitive advantages, as conceptualized in the Relational View (e.g., Dyer and Singh, 1998). The relationship between IT and the conversion of inter-firm value-creating opportunities into interorganizational competitive advantage is still unclear. In this paper, we have developed a conceptual framework regarding the relationship between IT and interorganizational resource complementarity, which is an important determinant of interorganizational competitive advantage. Our analysis suggests that cooperating organizations need to develop three distinctive but interrelated capabilities in order to effectuate interorganizational resource complementarity with regard to IT. We propose that these capabilities form a pre-condition for achieving interorganizational competitive advantage by means of IT-enabled interorganizational relationships. Preliminary support for our framework and proposition is provided by a case study of an interorganizational relationship between a large European financial services firm and a major European telecommunication firm