Research On Corporate Strategic Network Role And Network Strategy

The ways of creating economic value have been fundamentally changing and the progress of the change has been quickened by the complexity of knowledge and technology, intensified global competition and swift development of the digital information technology. Along with more and more detailed division of labor in production and service trades, an individual company, even a major multinational can not internally master all the relevant activities of the value chain from product innovation to customer care based on only its own ability, moreover it is not economically sensible for them to try. In consequence, it has become a reasonable choice to cooperate between firms and other social actors, provide the resources and capabilities that the other party needs, and gradually create the increasingly strategic network in which various economic benefits linked closely. The strategic networks of firms are thought of a better adaptability to the present knowledge-rich age and environment because of they have an information-processing capacity superior to the market and hierarchical organizations, and more flexible supervisory mechanism, furthermore, the networks have taken a leading position in the economic and social innovation. In recent years increasingly high collaborative frequency among the firms including company alliance has made the firms to be internally embedded with the members of other relevant organizations within one of social, professional, and exchanging networks.It is universally recognized that a firm, as an autonomous entity, possesses a competitive advantage due to its external and internal industrial resources and capabilities. However, the viewpoint that a firm is only regarded as an isolated participant in a strategic network is unilateral and inadequate. Many scholars consider that every net structure has an important influence on the strategic activities of the firms imbedded in it and further on their achievements. The earliest theory of corporate network started from social network study, which researched the influence of net structure hollow and net density on participants in the net. The following studies of strategic network continue to use the same thinking framework, but put their stress on the functions of characteristics of the network itself to the activities and achievements of the embedded firms and, however, it seems not enough that the study on the network position of the embedded firms influence the firms, and it also lacks the support of substantial evidence. According to different positions of the embedded firms in strategic network, this paper divides them into different roles and expounds the effects of these roles to the behaviors and achievements of embedded firms, then put forward the embedded firms'patterns in locating roles, and further analyzes and demonstrates the strategic network formed in the course of selling stocks by underwriting syndicates for acting as sales which consists of investment banks in China.This paper is composed of the following parts:Chaper1 first describes the formation and development of strategic network. The view that taking firms as atomistic actors competing for profits against each other in an impersonal marketplace is increasingly inadequate. Firms are embedded in networks of social, professional, and exchange relationships with other organizational actors. Strategic network has very important effect on embedded firms. The purpose of this paper is to find out how network location influence corporate behavior and performance. Last, the significance and methods are presented.Chaper2 present the basic theory of strategic networks. The base of strategic network is corporate cooperation. There are four fundamental views about corporate cooperation: transaction cost theory, resource-based view, organization learning theory and social network theory. These four theories try to explain the formation mechanism of strategic network from different point of views and supported partly by demonstration.Charper3 summarizes studies on strategic network,corporate resource, capability, learning and reputation has connection with strategic network and their interconnects are main topics in strategic network study. Different basic theories analyze the interconnection between strategic network and firm behavior and performance.Chapter4 introduces the location parameters of the network. Nodes in network have three centrality parameters: degree, closeness and betweenness. Each parameter has its own meaning and math formula. Then the paper discusses the interconnection between centrality and other net parameters and structural holes in social network and centrality influence on firm performance is discussed. Then eight roles are defined according to firm location in network. Five of them are named as dominant, edge person, embedded person, searcher and broker. A different role an actor plays affects his behavior and performance. Macro strategic network model is built and relation between network density and macro strategic network is analyzed.Chapter5 first introduces industry cluster and then introduces two different cooperation strategies. A micro network role model is presented. A matrix model is made to show relationship between micro network and corporate resource and capability.Chaper6 presents a pattern to form a network strategy. Firstly industry and firm are analyzed, then the goal for network strategy is determined. Last the strategy network governance is analyzed.Chaper7 analyzes an example in IPO underwriting syndicates. In IPO investment banks always build underwriting syndicates to make market and distribute shares and an underwriting network is formed in a long period. Investment banks are positioned in different location in underwriting network.Chaper8 summarizes the basic theory and innovation points in this paper and points out the future orientation in strategic network study.