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Resource idiosyncrasy, performance, and inter-firm small-world networks

Jarle Aarstad (Faculty of Engineering, Bergen University College, Bergen, Norway)

Journal of Strategy and Management

ISSN: 1755-425X

Article publication date: 11 February 2014

468

Abstract

Purpose

Many networks take a small-world structure, with a high degree of clustering and shortcut ties that reduce the path-length between the clusters. It can be argued that small-world networks have benefits that are simultaneously related to network closures and the spanning of structural holes, but research on the network members’ performance is nonetheless inconclusive. The purpose of this paper is to argue that the concept of resource idiosyncrasy can explain the mixed findings. Firm idiosyncratic resources are not easily generalizable across enterprises.

Design/methodology/approach

Industries may vary in terms of resource idiosyncrasy, and the paper elaborates how this can moderate shortcut ties’ effect on performance in an inter-firm network.

Findings

If resource idiosyncrasy predominates in an industry, the paper proposes that inter-firm shortcut ties may increase performance, whereas shortcut ties may decrease performance if non-idiosyncratic resources predominate.

Originality/value

Applying the concept of resource idiosyncrasy as a moderating variable, the paper aims to explain shortcut ties’ effect on performance in an inter-firm network. The theory advanced here can have practical implications and also motivate future empirical studies to gain further knowledge about small-world networks’ effect on performance.

Keywords

Citation

Aarstad, J. (2014), "Resource idiosyncrasy, performance, and inter-firm small-world networks", Journal of Strategy and Management, Vol. 7 No. 1, pp. 19-29. https://doi.org/10.1108/JSMA-03-2013-0018

Publisher

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Emerald Group Publishing Limited

Copyright © 2014, Emerald Group Publishing Limited

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