Paper info: Captive in Business Networks
Title
Captive in Business Networks
Authors
Jan Ostendorf, Ronika Chakrabarti and
Stefanos Mouzas
Stefanos Mouzas
Lancaster University
United Kingdom
Place of Publication
The paper was published at the 27th IMP-conference in Glasgow, Scotland in 2011.
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Abstract
Abstract
Researchers often fail to take seriously the relevance of network constraints and tend to conceptualize companies’ choices as business actions that work and produce outcomes. This implies companies are free to choose their programmes of actions. The efficacy of companies’ choices can however be severely restricted by pre-existing embedded networks of business relationships. Companies may find themselves captive to business networks and, hence, being forced to act in a certain direction in order to establish or continue business. Consider for example, cost and price restrictions, specifications regarding retailer brands or manufacturer brands, limited number of irreplaceable raw material suppliers as well as the limited number of major customers. Extant research acknowledges the general need to take into account the contextual conditioning of companies. Nonetheless, there is a lack of empirical investigations that shed light on the impact of network constraints on today’s companies. This paper addresses this research gap. Based on an empirical investigation of manufacturer-retailer networks, this study attempts to map the multiplicity of network constraints and analyses how companies cope with these over time. The findings illustrate that although companies are captive in business networks they can find ways to deal with this captivity and pursue their own interests.
Researchers often fail to take seriously the relevance of network constraints and tend to conceptualize companies’ choices as business actions that work and produce outcomes. This implies companies are free to choose their programmes of actions. The efficacy of companies’ choices can however be severely restricted by pre-existing embedded networks of business relationships. Companies may find themselves captive to business networks and, hence, being forced to act in a certain direction in order to establish or continue business. Consider for example, cost and price restrictions, specifications regarding retailer brands or manufacturer brands, limited number of irreplaceable raw material suppliers as well as the limited number of major customers. Extant research acknowledges the general need to take into account the contextual conditioning of companies. Nonetheless, there is a lack of empirical investigations that shed light on the impact of network constraints on today’s companies. This paper addresses this research gap. Based on an empirical investigation of manufacturer-retailer networks, this study attempts to map the multiplicity of network constraints and analyses how companies cope with these over time. The findings illustrate that although companies are captive in business networks they can find ways to deal with this captivity and pursue their own interests.