Intra-group networks: A source of capabilities of business group affiliates in taiwan
Mahmood, I. Zhu, H.
Zhu, H.
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Abstract
This study fills a theoretical gap between capability literature and network literature by examining how the capabilities of a firm are shaped by its embeddedness in network ties. By using business groups in emerging economies as the organizational lens and adopting stochastic frontier estimation to measure firm capabilities, we argue that the effect of intra-group networks on the development of the focal affiliate's capabilities is contingent upon types of network ties as well as the structure of intra-group networks in which it is embedded. We find that in loosely connected networks of operating ties and investment ties, affiliates in the central of the network are well-positioned to access new ideas, information, and resources both within and outside the group. Meanwhile, central affiliates in a loose network of director ties and peripheral affiliates in a dense network of director ties may benefit from efficient resource-sharing and internal coordination.
Keywords
Business group, Capability building, Intra-group network
Source Title
Academy of Management 2006 Annual Meeting: Knowledge, Action and the Public Concern, AOM 2006
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Date
2006
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Type
Conference Paper